CityU Enterprises Limited

Established in 1991, CityU Enterprises Limited ("CityUE") aims to support the University to enhance technology transfer and to nurture a culture of entrepreneurship. Its primary objective is to incubate the research outputs of University faculty members and to build up strong links with the business and industrial sectors.

CityUE Investment Fund

Objective of the Fund

To provide investment funding support to startup companies established by staff, students and/or alumni of City University of Hong Kong (“CityU”) for  promoting knowledge transfer and commercialization of research outputs, and for strengthening the University’s culture of innovation and entrepreneurship. One objective is to create a repeatable model for CityU members to innovate in an entrepreneur-friendly environment, while it is also desirable for CityU to participate in the financial success of startup companies.

Amount of Investment

CityU Enterprises Limited (“CityUE”) will consider co-investment in a CityU startup company, following a lead venture capital (“VC”) or an angel investor, up to an amount of HK$2.5 million in exchange for a maximum of 10% interest of the company, whichever the lower.

CityUE will not serve on the company’s board of directors and will rely on the board member(s) representing the lead VC or angel investor.

Duration of Investment

CityUE shall follow the existing policy of CityU, which specifies that CityUE should exit from any startup companies within 5 years from the date of investment in the company.

The exit price shall be based on the market price or the latest net asset value of the company, whichever the higher, and the exit terms shall be subject to agreement between CityUE and the company.

A shareholder agreement shall be executed between CityUE and the company at the time of investment to specify the exit arrangements.

Eligibility

The applicant must be a company registered under the HKSAR Companies Ordinance for not more than 5 years as of the date of application. 

The team forming the company must consist of at least one key person who is associated with CityU in the following capacity at the time of application: 

  • current undergraduate or postgraduate student; or
  • full-time academic staff who may hold shares and/or serve as a non-executive director or consultant of the company, providing technical or domain expertise to the company; or
  • alumnus who has graduated for not more than 8 years as of the date of application

The team forming the company is required to appoint an executive-in-charge who is not a full-time staff of CityU, to be responsible as the liaison person of the company.

Application

Applications are accepted throughout the year. Interested companies are required to submit, or make available through its lead VC investor, the following information to CityUE for application of the CityU Investment Fund:

  1. Business Plan and Valuation of the company:
    1. Description of the company’s business (including problems to be solved, solution/ technology, etc.)
    2. Market analysis (including target market, market growth and trend, competitor analysis, etc.)
    3. Marketing strategy (including the 4Ps)
    4. Organisational structure/ management team composition
    5. Financial forecast with a 3-year budget plan
    6. Valuation calculations, methodology and assumptions
    7. Capitalization table detailing all shareholders before and after the proposed financing

    A template with a sample illustration compiled by ACCA and TID

  2. Supporting Documents
    1. Certificate of Incorporation
    2. Hong Kong Business Registration Certificate
    3. Latest Annual Return submitted to the Companies Registry
    4. Staff/ Student card or graduation certificate for proof of association with CityU
    5. CVs of all leading team members, with one person as the executive-in-charge
    6. IP rights, evidence of grant of patents/ certificate of filing and copyright ownership obtained by the company (if any)
    7. Documents related to funding support from the government and/or other third-party investors (if any)
    8. Agreement between the company and other collaborating parties on R&D work of the company, such as sharing of the royalties, licensing of IP rights etc., where payments are to be made using the funding of CityUE Investment Fund (if any)
    9. Information about the lead VC or the angel investor and their valuation
    10. Term sheet signed with the lead VC and other related contracts, even in draft form (if any)

Application documents should be sent to the Company Secretary of CityUE by email to CIFund@cityu.edu.hk and by hardcopy to CityU Enterprises Limited, 2/F, Block 2, To Yuen Building, 31 To Yuen Street, Kowloon, Hong Kong.

A checklist for application for the CIFund

Assessment and Selection

Each application will be considered and assessed by an evaluation panel appointed by CityUE based on the following selection criteria:

  1. commercial viability of the business and its sustainable competitive advantages
  2. market size and growth, particularly the target market segment
  3. innovation and technology content of the business
  4. experience and/or capability of the company and its team to lead the company towards long term success
  5. social and/or community impact of the company’s business and innovation
  6. any other criteria that CityUE sees fit

Qualified companies will be recommended to the CityUE Board for approval of investment.

Monitoring and Review

Each company shall provide CityUE quarterly reports and an annual report on the progress of its business together with the financial statements of the company. 

CityUE Services

If required, CityUE can provide company secretarial and/or accounting services to the company at a fee to be agreed between CityUE and the company.

Enquiries

For enquiries, please contact Ms Agnes Lam, Company Secretary of CityUE (phone: 3442 6784; email: CIFund@cityu.edu.hk)