Going Where the Growth Is!

Just a couple weeks ago, two dozen independent thinkers from around the globe descended on Phnom Penh, Cambodia for our Cambodia Boots on The Ground Meet Up.

We heard presentations from 12 companies in a smattering of industries and were able to learn firsthand how entrepreneurs on the ground are taking advantage of the Kingdom’s astounding growth. The event kicked off with a dinner and birthday celebration, and concluded in the taproom of Kingdom Breweries. The in between was just as exciting.

Cambodia, like most frontiers, is difficult to gain exposure to, short of moving there. Unsurprising, this is what some of our attendees are in the process of doing. The capital markets are immature with only one equity, Phnom Penh Water Supply, trading and no corporate debt market.

Good PE opportunities are few and far between. Our friends at Leopard Capital have done an impressive job creating a vacuum for deal flow; it seems that all deals either good or bad are brought to Leopard for assessment before they hit the mainstream crowd. After all of this you might be asking yourself if it is so hard to get exposure to Cambodia why did we host a Meet Up there?

That’s a great question and one I thought long and hard about before I touched down. Cambodia is a unique situation since it was left for dead until the early/mid 2000’s when investors started poking around. In the meantime, Thailand and Viet Nam were experiencing seemingly exponential growth and moving towards emerging market status (I argue that it is only a matter of time until both Thailand and Viet Nam are reclassified as Emerging Markets. Boss, Louis Vuitton, Starbucks and Pizza Hut don’t sound very frontier, do they?)

The game being played in Cambodia is one of mean reversion. While Cambodia will never be a Thailand or Viet Nam it is growing rapidly from a low base. GDP per capita is currently less than $1,000, to reflect a similar standard of living with its neighbors, that HAS to rise.

Importantly, Cambodia has a clear roadmap for development and political stability, two items most frontiers lack. Visit Bangkok or Saigon and you will see the potential Phnom Penh has. In 10 years I foresee Phnom Penh being nicknamed “little Ho Chi Minh.” On political stability Hun Sun has done a superb job of keeping growth a priority. This has not only made Cambodia one of the most business friendly countries in Asia, but has brought countless numbers of people out of poverty. I don’t know many countries that can boast about this.

But I digress. The reason we chose Cambodia as the location for our third Meet Up was because you need to vet the place before it looks like Viet Nam; at that point it will be too late. Getting your feet wet and learning how the country functions today is critical for when investment opportunities arise.

Besides, Cambodia changes at a lightning pace. Over the week of our conference I found my favourite coffee shop in town to be gutted and undergoing renovation. This is not an uncommon occurrence. Nothing sums this up better than the picture of Central Market and Vattanac Tower below.

You can say the same for Mongolia where east meets west.

With that we will continue writing about Cambodia and the region as a whole, as we believe Southeast Asia to be one of the most exciting investment destinations right now. Besides, we want a piece!

On that note I will part ways by saying, for those of you who we weren’t able to make it to Cambodia we will likely be hosting a meet in Indonesia later this year. Stay tuned for more info!


“Let me reassure that the Kingdom of Cambodia, a country with independence, neutrality, peace, freedom, democracy and human rights as you all have seen, shall be existing with no end.” – Hun Sen


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