HSBC closes Hong Kong-based Serai trading platform
HSBC Holdings shut down a trading platform it launched three years ago in Hong Kong after failing to build a commercially viable business.
Serai, a wholly-owned unit of Europe’s biggest bank that connected small and medium-sized garment manufacturers with global component suppliers, confirmed its closure in a notice on its website and said that its services would not be available from June 25.
“The decision to liquidate Serai follows a thorough review of the business and is a purely business decision,” HSBC said in a statement Wednesday, but did not provide details on Serai’s business or his investment in the company.
Serai was HSBC’s first investment in a non-banking technology startup.
Just months after Serai launched in June 2019, political unrest in Hong Kong sparked protests that dealt a blow to businesses, followed by the Covid-19 pandemic that hit global supply chains.
HSBC has invested $70 million in Serai
“We regret to inform you that Serai will terminate all of its operations,” he said.
“Despite the tremendous progress the team has made, it has proven difficult to build a commercially viable business. As a result, we have made the difficult decision to close our doors,” Serai said.
HSBC has invested around $70 million in the start-up over the past three years, two sources familiar with the matter said, adding that Serai had begun winding down its business in recent weeks.
Serai’s platform connected buyers and sellers in the highly fragmented apparel and apparel industry.
Veteran commercial banker Vivek Ramachandran, who previously worked in HSBC’s commercial banking business, was Serai’s CEO. Last month, Ramachandran returned to HSBC to lead its Global Trade and Receivables Finance unit.
Serai’s platform offered financial, environmental, social and corporate governance metrics and analytics to enable traceability from finished goods to raw materials.
- Reuters with additional editing by Jim Pollard