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Sean Hung grew up in a family where finance was a natural subject of conversation around the dinner table. Both his parents were finance professionals, so dealing with numbers and financial information is embedded in his DNA, and from an early age this was his most likely future direction.

A career in finance subsequently blossomed, perhaps because he always seeks the next challenge, the next opportunity. Still young and fresh-faced, and never happy to rest on his laurels, he is now a big player in the digital assets industry as co-founder and CEO of Chiron Group.

Hung attended St Joseph’s College, a prestigious all-boys Catholic school in Hong Kong, before heading to the US to study for a double major in finance and marketing at Bryant University in Rhode Island, then an MBA at Boston’s Northeastern University. These enjoyable years on the East Coast led him to believe the US education system provides more opportunities to “think outside the box”.

More specifically, his degree helped him understand how businesses work. “You can’t do business without knowing the numbers, but just knowing the numbers without knowing how to push a product to market is also meaningless,” he observes.

Challenge-driven

Having completed his education, he stayed in Boston and joined Wellington Management, one of the world’s largest privately held asset managers, as an analyst in 2013. Though the experience was useful, he found his role in asset management – the traditional buy-side – a bit too slow-paced for his liking.

Spurred by a courageous character trait of continuously breaking out of his comfort zone, Hung switched continents in 2015 and flipped to the other side of the financial coin – the sell-side – in the guise of Cantor Fitzgerald in Hong Kong. Here, in high-pressure investment banking, results were everything and he thrived on the challenge.

As a director on the debt capital markets and special situations team, he relished the chance to meet so many interesting people and the faster pace of Hong Kong life, commenting: “It really rewards hard work and people who are trying to build a business for themselves.”

People-oriented

Connecting the dots between buyers and sellers, structuring unique deals, having to perform under pressure – all of this brought out the best in him. “It’s very difficult to convince people that you’re building a business without results,” he says. “It really drives you to do more than what you would normally comfortably do.”

A talkative and convivial young man, Hung became mindful of not just being results-driven in banking; he wanted to nurture long-lasting relationships forged through being genuine, irrespective of whether someone became a client or not. “Most business does not happen if it is purely transactional,” he shares. “By building these long-lasting relationships, even if business comes later, it comes naturally.”

Crypto calling

Hung could have stayed on in banking, but again some internal alarm bell told him to branch out into a brave new world. He saw “higher growth opportunities” elsewhere, especially in the crypto market – a digital innovation he had observed from an outside perspective for several years, but became determined to master by working on the inside.

Leaving Cantor Fitzgerald at the end of 2018, he was invited to join a team of 10 and build a startup called Diginex, whose aim was to create one of the first institutional crypto exchanges. He also served as director of a sister company, Diginex Solutions, which focused on blockchain ESG (Environmental, Social and Governance) solutions to the problem of investors finding it difficult to verify the ESG metrics reported by companies.

“Blockchain, due to its immutable and transparent nature, adds credibility to the data being consumed by investors,” says Hung, who believes ESG-related investing is a global trend that will sustain through the foreseeable future.

New asset class

Once their digital assets exchange was listed on Nasdaq in 2020, Hung decided to exit and seek pastures new yet again. With a few partners, he set up Chiron Group to focus on investing and growing businesses in the burgeoning digital assets field. Aside from investing in high-growth, early-stage projects, Chiron also eyes more stable, later-stage digital-asset infrastructure companies such as those in the trading, media and software sectors.

“As an investor, we like to take an active role in the company, taking on board seats or advisory roles, to make sure we are able to help drive certain business decisions for our portfolio,” says Hung.

He believes investing in a comprehensive range of players in the crypto field means companies can tap into a broad skill set and would be more amenable to receiving investment. “We can provide you support from the media arm; we can provide you support from liquidity perspective and so on,” he adds.

Bad actors

Of course, cryptocurrencies and the digital assets industry itself have gone through a torrid time recently, but Hung is undeterred. He comments: “It is undeniable that during the early stages of the digital assets, there were a lot of bad players as it was an unregulated field. That’s why it’s especially important for us as investors to be diligent and identify who are the real players.”

One bright spot of scandals like the bankruptcy of FTX and Three Arrows Capital crash is, he says, an acceleration in the onset of regulation around the world. This can only benefit the digital assets industry, especially given that many investors are scared of its opaqueness.

“Without regulation, digital assets will always exist in the dark and traditional investors will remain sceptical about the asset class. It also bars all the major traditional finance institutions from investing in it due to compliance concerns,” he notes.

Gaming insights

Undoubtedly a driven person, Hung is also a family man who cherishes his weekend downtime. Gaming has always been a big part of his life, and these days his two children sit with him as he follows his favourite esports teams. “Esports will be such a natural form of entertainment for my kids growing up so they won’t have second thoughts about them,” he opines.

Such is his love for video games that he has started to invest in promising and growing gaming companies and actively seeks to serve on their advisory boards. Hung intends to bring more value to these companies through his expertise in capital markets.

One such venture – Insights.gg – is a software company that serves the esports community by recording and analysing gameplay through computer vision and AI. “Imagine an automated analyst that allows individual players and coaches to make better decisions on how to better their game strategy and gameplay mechanics,” he says excitedly of a future digital world he is helping to shape.

After 2016’s paltry Burgundy harvest, Robin Lynam ponders the merits of investing in valuable wines before release

Few of the grape-growers of Burgundy will look back on 2016 with fond nostalgia. Lulled into a false sense of security by a mild winter, the region was hit hard in the spring – first by unexpectedly severe frost, and then by hailstorms, compounded by unusually heavy rain. The quantity of the eventual harvest was drastically reduced.

That’s bad news for the many wine lovers in Hong Kong and China who in recent years have turned to Burgundy rather than Bordeaux when buying premium priced French wine, but at least the quality has turned out to be much better than had been widely feared thanks to a hot early summer which helped the vines to recover, and fine weather during the harvest itself.

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In some ways that just makes it all the more painful that there isn’t enough to go ‘round. Just over 163 million bottles are available from 2016, which, against an average calculated over the last 10 years, means production is down by about 20%.

Smaller quantities of course mean higher prices. The Burgundians are traditionally less prone than their Bordeaux counterparts to overcharge for their wines, but they too have to make a living, and if there is less to sell, then they have to ask more for it.

So should Burgundy lovers be looking at buying 2016 wines en primeur – before release – rather than waiting to see what prices are when the vintage has been shipped?

The rules have changed in recent years. Although not the only region to invite customers to invest early in wines at a supposedly lower price than they will later command, it was Bordeaux that made en primeur a major element of its marketing.

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As demand from Chinese buyers for the top Bordeaux wines went through the roof in the early years of this century, so did the en primeur prices. Customers who had bought with the idea of possibly turning a profit on at least some of the bottles found themselves holding cases worth less on the open market than they had paid for in advance.

The market has since adjusted, and provided you are buying high quality well known wines wisely through a reputable wine merchant, Bordeaux en primeur now looks once again like a reasonably attractive idea. But that period of inflation disillusioned some wine lovers, many of whom turned instead to Burgundy.

Burgundy en primeur has generally been less about price than about obtaining an allocation year after year as a preferred regular customer. During these times of strangled supply, if you want to obtain some of the better wines, en primeur is almost the only way.

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Bordeaux and Burgundy are talked of so often as though they were two sides of the same coin that people tend to forget that even in years when Burgundy is not beset with frost and hailstorms, the quantities of wine the region produces still amount to only a tiny fraction of Bordeaux’s output.

Either region can experience bad weather and a reduced harvest, of course, but Bordeaux has more than 120,000 hectares under vine by comparison with Burgundy’s just under 30,000.

In Hong Kong and China much of the interest in both regions is focused on the red rather than white wines, and in this area too Bordeaux’s production dwarfs Burgundy’s. Still, white wines account for around 61% of Burgundy’s total production, and sparkling white Cremant de Bourgogne, which is often a very acceptable alternative to Champagne, represents another 11%. That leaves just 28%, and although that is mostly red, rosé accounts for some of it. Burgundy is 50% planted with Chardonnay to just 41% Pinot Noir.

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“The question of volumes is inescapable,” says Adam Bruntlett, who has succeeded Jasper Morris MW as the Burgundy buyer for Berry Bros & Rudd. “While we have been well looked after by suppliers thanks to our longstanding relationships, there are many instances where volumes are limited.”

With strong pressure on prices and volumes, this, suggests Bruntlett, is a time to start looking beyond the Grand Cru vineyards. He points to lesser known producers and areas of fine but much less famous terroir which produce wines that don’t command the same stratospheric prices, whatever the weather has been like in any given year.

“The 2016 vintage is the time to look beyond the bigger names and consider lesser-known villages such as Marsannay, Santenay, St Romain and Auxey-Duresses,” says Bruntlett. The 2016 Burgundy white wines, he notes, generally have a fresher, more classic feel than their richer 2015 counterparts.

“Some frost-affected vineyards display a more angular profile, but many of these filled out over the course of the autumn barrel tastings and will continue to do so with further élevage [a wine’s adolescence or education]. The very best white wines will come close to matching those of the 2014 vintage.”

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For Chablis lovers, says Bruntlett – and you can’t really enjoy seafood and not love Chablis to go with it – the bad news is that quantities are severely down. As for the 2016 reds, in general Bruntlett finds them more consistent than the whites, and worth considering at all quality levels from Grand Cru down to everyday casual drinking.

“Across the board, the wines display an unmistakably Burgundian Pinot Noir fruit character. They offer a beguiling paradox of initial rich fruit on the front of the palate and succulent acidity on the finish, leaving one delightfully perplexed as to whether this is a warm or cool vintage. The very best wines are the equal of the 2015s – albeit in a style that will appeal more to the traditional Burgundy drinker,” he says.

Berry Bros has a good range of red and white Burgundies available to its Asian-based customers across a range of price points. Other well connected wine merchants able to offer a reliable en primeur service include Altaya, ASC Wines, and Watson’s Wine.

Terroirs et Signatures de Bourgogne / Photo: Anthony Upton

Still shopping for a few cases from the Grand Cru vineyards? “Clos Vougeot and Vosne Romanee experienced a very good vintage,” says José Lau, Private Sales Manager for Berry Bros & Rudd in Hong Kong. He too recommends buying en primeur.

“Supply and demand play a big role in why en primeur makes plenty of sense for Burgundy. There has been a huge increase in Burgundy drinkers in the past 10 to 12 years which has driven prices up again and again. Buying early will save you money down the road – and you might even use it as an investment to gain some.”

This article appears on Gafencu Magazine’s March 2018 print issue entitled “Burgundy En Primeur” by Robin Lynam

Tag: invest

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