Becoming a co-founder happened almost by accident for Katrina Cokeng, CEO of Xen Capital, a Singapore-based alternative investment platform. She has experience in investment banking at Merrill Lynch, and management consulting at McKinsey & Co; and was an investor for private-equity firm Pomona Capital. Having had a wide exposure early in her career to the financial ecosystem, Cokeng’s finance-rooted career soon took what she considers a “natural evolution” towards the financial technology (fintech) scene.
“In 2016, I joined a few partners originally with the intention of starting a fund to think about investing in fintech, and more specifically, fintech disruptors,” Cokeng recounts in an interview with The Edge Singapore. “While looking at the space and trying to find that product market fit of what we were doing, we realised that in Asia, there was still a lot of different areas of finance that were ripe for disruption.”
This eventually landed Cokeng in the position of co-founder and chief commercial officer of Hong Kong-based financial services and technology company Oriente. While there, she looked at how to disrupt the ways that lending was being executed in Southeast Asia, with the goal of offering consumers much more accessible lines of credit.
Cokeng soon discovered that she enjoyed solving problems and being able to focus on day-to-day execution in her role. “That’s really what it means to be a founder of a business,” she says. “Being able to focus on not just giving advice, which is what I focused on before as a consultant, but also work on essentially executing and making things happen as a finance executive.”
Soon after, Cokeng recognised another common problem in the fintech space: that of how many investments were being done, and also how alternative investments were being accessed. “For people without vast amounts of wealth, it’s very difficult for us to access great investment opportunities, especially with alternative investments,” Cokeng says. “And the only way to really create a solution, and put my ideas into actions, and into reality, was to start a business myself.”
With that, Cokeng decided to start Xen Capital four years ago. Xen Capital is an alternative investment platform focused on providing more access and better transparency for investors who are looking to either raise or deploy capital into alternative investments.
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“At Xen Capital, it’s very important to us to use technology as a way to really disrupt how things are being done today,” says Cokeng. “This is how we see ourselves standing out from competitors, and providing the best solutions for our business-to-business (B2B) clients via our platform.”
Not just a digital asset management company
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Xen Capital works like an e-commerce platform for the investment community, according to Cokeng. As a business-to-business-to-consumer (B2B2C) platform, a key difference between Xen Capital and a lot of its competitors is that the company seeks to provide the technology infrastructure to enable its B2B clients — made up largely of wealth managers or asset managers — to be more successful in both acquiring and retaining their clients.
“That’s why we are B2B2C, which is a very important distinction for us,” emphasises Cokeng. “We look upon ourselves as an enabler for our target clientele, which are the B2B clients, to help maintain and grow their businesses.”
“At Xen Capital, we’re not trying to disrupt the client relationships of our B2B clients, which is why we’re not trying to go directly to the consumer,” she adds.
Cokeng shares that as an investment marketplace in a highly regulated system, it is important for Xen Capital to balance the desire for growth and to be as open as possible for effective networking to take effect, while keeping in mind the regulatory requirements that have to be adhered to.
“We do understand that these regulatory requirements exist to protect investors from fraud or bad investment opportunities,” says Cokeng. “That is why we offer a systematic growth trajectory in options that our clients can access.”
This is where Xen Capital’s “Xen Portals” come in — B2B SaaS (software as a service) storefronts that clients take on. “Each player in the space, each regulated entity that we serve as client can have their own virtual storefront in this sense,” she says. “In doing so, we immediately can bring them from offline to online.”
“Our clients can choose to do whatever they want within their portal,” Cokeng adds. Each portal is a client’s own virtual private “room” or storefront for them to invite their own clients and/or cherry-pick different investment opportunities that they want to look at.
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At the second level, all these “Xen Portals” are connected to a wider overall marketplace. “Basically, anyone who wants to raise capital or find investment opportunities can do so through the marketplace,” explains Cokeng.
Xen Capital’s platform has displayed much potential, processing over US$200 million ($274 million) of transaction volume in private market deals in 2021 alone. In a sign of how the company’s prospect is being recognised, it raised US$7.5 million in a Series A funding round last year.
On what Xen Capital seeks to achieve in the fintech space, Cokeng says: “In our work, we’re not looking to just digitise an asset management company. We’re really looking to change the way things are being done, by making things a lot more transparent and a lot more accessible.”
“With Xen Capital, we’ve had to create a real platform that would enable a kind of network effect for different kinds of players to connect to each other,” she adds.
New landscapes on the horizon
Looking forward, Cokeng hopes to grow Xen Capital by forming more partnerships across the region, beyond Singapore and Hong Kong, where it is now operating. “As we grow over time, we’re developing partnerships with regulated entities and other key jurisdictions like the US, Japan, and more,” she says.
Cokeng explains that Xen Capital works with a good mix of supply-side and buy-side partners. “For the supply-side, we have broker dealers and funds such as venture capital funds, or other types of funds that offer their product directly through a platform,” Cokeng explains. “On the buy-side, we work with a lot of external asset managers, and also with some institutions like private banks, or anyone looking to basically open up a space for their clients.”
Geographically, Xen Capital’s key hub right now is in Asia, “since that’s where we started and that’s where our strengths are”, she says. “But in the next 12 to 18 months, we’re also looking to expand to Dubai, and we are targeting the Middle East and the US.”
With this in mind, Cokeng shares that the company has been spending time in both the Middle East and US markets as an “exploratory” business step, so that Xen Capital can be ready to move forward strongly in the two regions in 2023.
When asked about what more can be done in the alternative investment space, Cokeng says that greater investor education is crucial for a strong foundation for long-term development. “This is true not just for highnet-worth investors, but also for a lot of the wealth advisers as well,” she emphasises.
“Right now, there is a huge misconception that all alternative investments are highly risky when in reality, there are so many different flavours of alternative investments,” Cokeng explains, Alternative investments range from those that deal with inflation protection and wealth preservation, to more conservative types of products, she points out.
“So it’s very important to really educate investors around all the different risks and returns in these different products, so that they can make the best decisions for their clients and for themselves,” she adds.
On a whole, Xen Capital, with Cokeng’s lead, has clearly achieved new heights and new innovations in the alternative investment space, with bigger and better plans constantly in progress. Her advice to those interested in making a change in the work that they do? Always have a clear end-goal, be experimental and do not fear failure.
“We are always thinking about how we can benefit the end-customer more… which involves brainstorming about how to make existing products a lot more accessible,” says Cokeng. “This is essentially democratising the opportunity, so that whether it’s banking payments, credit, or investments, it is easily accessible to anyone with any amount of money.”
“Ultimately, you need to be willing to try a lot of different things out and be willing to fail,” she adds. “I think that’s what it means to be a founder, but also what it means to think about creating something that is essentially a disruptor in the business.”
Photos: Albert Chua/The Edge Singapore
