RREs Jim Robinson banks on SmartPay Day in China

Filed in archive Private Equity on August 16, 2005

Jim Robinson IV, general partner of RRE, a New York based venture firm has recently made an investment into Smartpay. This company is the leading mobile payments service in China, enabling almost 350 million middle class Chinese to purchase pre-paid credits, pay utility bills, transfer credit and make purchases where the use of the mobile phone as a payment terminal provides compelling convenience.

"SmartPay is focusing on an enormous potential market (mobile payments) and has a unique position with its banking partners (tight integration with direct linkage to customer bank accounts)," says Robinson in an interview with ChinaVentureNews.

With funding from several venture capital companies, SmartPay has built a leadership position position in deploying mobile payment services since its founding in 2003 as a sister company of Linktone (Nasdaq: LTON), a leading wirless value-added service provider in China established by Derek Sulgar, a former Goldman Sachs investment banker who knocked on many telecom doors before striking gold according to VC blogger, Ed Sim. Sulgar's company was the only American-Chinese high -tech company to float a successful IPO.

Under the terms of the new financing, RRE will take a minority equity stake in the company. Other current shareholders include: Accel Partners, Icon Ventures Asia, Lunar Group and others.

Despite these venture financing commitments, Robinson acknowledges that the investment road in China is not without risk. "The private equity / venture capital market in China remains in its infancy, which makes it both exciting and challenging. Naturally we hope that the regulatory environment will ultimately unfold in a fashion that is friendly to outside investors. But it is a risk," adds Robinson.