The New York trading powerhouse Jane Street has quietly invested in Micro Connect, a Hong Kong start-up that generates a wealth of unfiltered data on China’s economy using a new and complex form of financing.
Jane Street, which has become one of the most profitable trading firms on Wall Street, bought a minority stake as part of the Hong Kong group’s most recent funding round last year, three people with knowledge of the matter said. It invested between $15mn and $20mn, one added.
Micro Connect extends financing to small businesses such as noodle shops, karaoke bars and hair salons across mainland China and collects a proportion of their daily revenues in return. It has packaged those revenues into tradable financial securities.
That gives Micro Connect an insight into the country at a time when accurate data on its economy is becoming harder to find. Its founder Charles Li told the Financial Times last year that he could see signs of the real impact of China’s end to zero-Covid rules in 2022 because pharmacies’ daily sales rose.