Two of Asia’s leading entrepreneurs gave real estate investors a glimpse into the worlds of Web 3.0 and deep tech at the ULI Asia Pacific Summit.
The Summit, held in Hong Kong, featured conversations with two leading tech entrepreneurs: Jennifer Zhu Scott, executive chairman of The Commons Project, a tech nonprofit organization working to empower people to access, manage and share their data and Yat Siu, co-founder and executive chairman of Animoca Brands, a Hong Kong-based game software and venture capital company.
Despite the ongoing COVID upheaval in China and Hong Kong, Zhu Scott, who also built AI and deep tech-focused investment firm Radian Partners, said now was a good time for investors focused on the long-term to investing in tech firms in China and Hong Kong.
“I actually think we perhaps in the one of the best times in terms of positioning and plotting your portfolio right now. The evolution of technology has reached a tipping point and whenever there’s a tipping point that creates an incredible opportunity for wealth creation,” she said.
She made the distinction between businesses which use data to make marginal but scalable profits—such as food delivery apps – and deep tech companies in sectors such as AI, quantum computing, life sciences and new energy which are creating solutions and intellectual property. China has recently cracked down on what it considers the excesses of the former type of business but seeks to encourage the latter.
Zhu Scott compared the approach to Germany, famous for its Mittelstand of successful mid-sized firms, rather than the U.S. tech scene, which is dominated by a handful of colossal companies. She said there were numerous low-profile China firms making progress in a number of fields.
She was also optimistic about the prospects for Hong Kong as a tech location, once it has loosened its covid restrictions. “We have a lot of talent in Hong Kong and great universities, which are making world class breakthroughs in terms of research.”
However, she said the city’s two biggest industries, real estate and finance, were very disconnected with academia, which was both a negative and an opportunity for those who tried to bridge the gap.
She said: “Right now everybody is very pessimistic. But perhaps, by the time everybody turns optimistic, it will be too late [to invest].”
Zhu Scott’s involvement with The Commons Project stems from her interest in making sure consumers have control of their data. Yat Siu believes blockchain and Web 3.0 will be a part of consumers gaining control of their own data.
Siu gave the audience and introduction to the metaverse and the growth of Web 3.0, which he described by saying: “Web 1.0 was read, Web 2.0 was read and write, Web 3.0 will be read, write, own.” He compared gaining ownership of data to the introduction of property rights, which decentralized power and allowed capitalism to thrive.
He also spoke about virtual land and how it could be considered to have value due to the network effect, which he also argued was the basis of the valuation of physical land. Land in Hong Kong is more valuable than land in other cities, even though a landowner can build the same building in other places. Virtual land can have this network effect, especially if ownership is confirmed by blockchain, if for example, the virtual plot is near one owned by a celebrity.
Siu also spoke about the benefits of blockchain for real estate, using nonfungible tokens to represent ownership. “The settlement layer, the transaction, the legal aspect, the ownership transfer happens all in a single transaction. If you’re able to trade physical property at the speed in which you can do things on blockchain, the value of real estate will probably increase, because you can start trading and transacting much faster. That’s the power of blockchain.”
Asked if Web 3.0 was a good investment, Siu said to look at what youngsters were doing and what they wanted. “What your children wanted for their birthdays was probably something virtual,” he said.