The retreat of Western multinationals from mainland China is prompting one tech vendor, Shanghai-based GienTech, to follow its clients into new markets.
GienTech, a tech vendor for financial institutions, has launched a new business in Hong Kong to deliver its experience and capabilities to banks and insurers outside of the mainland.
It has a mandate with a Hong Kong-based financial institution that it cannot yet announce, says William Wong, GienTech’s local general manager in charge of overseas markets. “We’re not starting with a mainland Chinese bank or a global bank, but a Hong Kong institution,” he told DigFin.
At a launch event organized by the company, speakers included representatives from livi bank, a Hong Kong virtual bank; the Hong Kong Jockey Club (not a licensed financial institution, but one with finance-like services); and Shenzhen-based WeBank, the virtual bank built by Tencent.
Old roots, new software
GienTech’s roots go back to Beijing in 1995 where it was founded as VanceInfo. There it provided IT services to enable global companies including GE and Microsoft to enter the China market.
It became a favored startup, winning venture funding in 2005 from Sequoia, Legend Capital and GGV, and it listed on the New York Stock Exchange in 2007. A division of the group that focused on serving financial institutions operating in China, building core banking solutions and supporting digital transformation, was sold to Blackstone in 2014 and rebranded as GienTech.
The company now offers full-stack software development, DevSecOps, consulting, databases, and quality assurance. Wong describes the company as an R&D hub to help banks and insurance companies migrate to cloud and integrate and maintain open-source applications.
“Open source is key to modernizing IT architecture, but how do you guarantee security and quality?” Wong said. China’s national-security laws add more complexity to financial systems. The need for reliability and security makes integrating open-source software difficult. “It’s a nightmare for chief information officers.”
China market challenges
GienTech has become a leading vendor helping banks and insurers migrate that complexity in mainland China. Although a Chinese company, it has worked mainly with American technology, because it has been serving institutions such as Morgan Stanley, Citi, AIA, and Bank of America, as well as regional firms such as DBS and the Singapore and Hong Kong stock exchanges.
But the ground has shifted. Chinese vendors have become competitive in areas such as cloud and databases. Geopolitical tensions have also seen US firms either reduce their footprint in China, or be shut out of opportunities. GienTech needs to work with US cloud and database providers to support its customers, but is finding it harder to communicate with them when they make changes to their software.
This has led GienTech to launch in Hong Kong, where it is keen to work with partners in open-source developments. In mainland China, it has just launched a Financial Digital Infrastructure Open Innovation Consortium, to support collaboration among banks, cloud providers, and tech vendors. That’s for the mainland market. This week, GienTech has launched a new consortium in Hong Kong to serve the overseas market.
The idea is to remain involved in global tech discussions and projects, while continuing to support global firms operating onshore in mainland China, and help Chinese firms expand overseas. GienTech has existing offices in Japan, Malaysia, and Singapore, as well as Hong Kong.
“We want our clients and business partners to work with us to create an international version of Origien [the company’s database service] and use Hong Kong as a base to take our business globally,” Wong said.
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- Source: https://www.digfingroup.com/gientech/
