The real-life Emery and Evan from “Fresh off the Boat” launch Batu Capital for cann*bis, crypto and big data startups
Restaurateur
and raconteur Eddie Huang is the best known of the three “Fresh off the Boat”
brothers (it was his memoir that inspired the ABC sitcom), but his younger
brothers Emery and Evan remain relatively mysterious even to its most loyal
viewers.
Though the two’s namesake characters are also prominently featured on
the show, their real-life counterparts have kept a much lower public profile,
making sporadic appearances on Eddie’s social media.
Emery and
Evan, however, have been busy investing in real estate and recently branched
into tech startups. Though their multi-family investment office Batu Capital
just launched this year, it reached a big milestone this week when one of their
first investments, MJ Freeway, an enterprise software developer for the
cannabis industry, entered into a merger agreement with MTech that will make it
part of a Nasdaq-listed holding company.
The
fictionalized versions of Evan and Emery Huang, portrayed on “Fresh off the
Boat” by Ian Chen and Forrest Wheeler. (Photo by Vivian Zink/ABC via Getty
Images)
In an
interview, the two brothers told TechCrunch about moving into the tech sector
and the startups they want to fund in the United States, China and Southeast
Asia. Batu Capital is focused on finding companies in the cannabis, blockchain
and crypto sectors, as well as big data.
In addition
to MJ Freeway, which provides enterprise resource planning and compliance
tracking software for the cannabis businesses, its portfolio also includes
Vidy, a startup building a new approach to video ads on Ethereum, and Sora
Ventures, a crypto-backed blockchain and digital currency venture fund. Batu
Capital invests in seed or Series A stage companies or Series C and pre-IPO and
its typical check size will be about $500,000 to $2 million.
Though Batu
isn’t a single family office, instead raising capital from a network of limited
partners for each investment, its creation was motivated by Emery and Evan’s
desire to protect their family’s assets after several generations of political
and social upheaval.
“Long story
short, our family has made and lost fortunes more than five times within the
past two generations and quite frankly I’ll be damned if we let it happen again
in me and Evan’s lifetime,” Emery says.
Before World
War II, the Huang brothers’ paternal relatives amassed a railroad fortune, but
lost it all during the Japanese invasion of Nanjing. They escaped to Chongqing
and began rebuilding their wealth through real estate, but were forced to flee
to Taiwan during the Chinese Communist Revolution, losing everything once
again. Meanwhile their maternal grandparents had also fled from China to Taiwan
to escape the Japanese army. Though they had worked in banking before, they
survived in Taipei by selling steamed buns on the street for several years
until getting jobs in a textile plant, eventually opening their own curtain and
upholstery fabric factory.
Like many
who had escaped the Chinese Communist Party, however, the boys’ relatives
remained wary of another invasion and though they had rebuilt their lives in
Taiwan, both sides eventually left for the U.S. That’s where their parents,
Louis and Jessica, met, married, and had their three sons. “Fresh off the
Boat,” the first American primetime sitcom in 20 years to star Asian-Americans,
is a fictionalized version of the Huang family’s ups-and-downs as Louis and
Jessica build a restaurant business in Florida, where the brothers grew up.
Investing in
the backbone of new industries
All three
brothers gained business experience by working on BaoHaus, the popular
restaurant chain Eddie launched on the Lower East Side of Manhattan in 2009.
Emery, who had won the Writers of the Future Grand Prize for science fiction
writing, exited early and moved to China. He wanted to work on novels set
there, but also look for new investment opportunities. At that time, Emery and
Evan were helping their parents prepare for retirement by exiting the
restaurant business and they began investing the family’s assets in real
estate, brokering deals between Chinese investment groups and New York City
property owners before deciding to branch into tech.
Batu Capital
is named after Batu Khan, the Mongol ruler and founder of the Golden Horde
dynasty, in a nod to their love of Mongolian history (they also recently
discovered, thanks to 23andMe tests, that they have some Mongolian heritage
through both their parents).
The firm is
focusing on cannabis because of its “massive addressable market, both in terms
of pain management and medical usage, as well as recreational usage,” Emery
says. In particular, the brothers are hopeful that it can replace the $17 billion
painkiller market, but without the side effects that have contributed to the
opioid epidemic. As for crypto, Emery says the brothers “were really drawn to
the applications of blockchain technology, not just for currency, but
blockchain in general, and smart ledgers in general, as a way to archive
information in terms of data storage and data fidelity.”
In each
sector, Evan says Batu looks for companies that want to build solutions for the
“overall infrastructure of the industry.”
For example,
MJ Freeway helps growers and dispensaries manage their business while making
sure they comply with state and federal regulations. Vidy, meanwhile, is using
blockchain to reboot the way publishers display ads. Instead of automatic
pop-ups or embeds, readers can decide if they want to see a video by placing
their finger or cursor over text in an online article (try it in this Esquire
Singapore article by hovering over the pink highlighted text).
By allowing
readers an easy opt-in to streaming videos, Vidy hopes to give publishers a
more nuanced understanding of user engagement. The startup, whose partners
include Mediacorp, Mercedes-Benz, and Deliveroo, also created its own ERC20
utility token, called VidyCoin, which advertisers use to purchase ad placements
and readers can earn by watching videos. Recording transactions on blockchain
enables Vidy to guard against different types of online ad fraud, including
click spam.
With their
family’s past setbacks in mind, the Huang brothers say one priority is to make
sure their portfolio is geographically diverse. In addition to the U.S. and
China (Emery is based in Shanghai and Evan is planning to move from the U.S. to
Beijing soon), Batu Capital is also looking at growth markets in Southeast
Asia, in particular the Philippines and Cambodia. The latter not only benefits
from Chinese funding, but also provides more transparency for investors, they
say.
“Our number
one priority for startups is the executive team. We want to make sure it’s
people who have a track record of building up companies in that industry or
related industries, or that have experience that can transfer over. They have
to have a competitive edge in the market. For example, what’s their niche in
the big data space or do they have strategic partnerships?” Emery says. “The
same thing with crypto and cannabis. We don’t just invest in the space. We need
to make sure they stand out.”
TC
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