In this file photo taken on Aug 3, 2020, a HSBC logo is pictured on a wall outside a branch of the bank in central London. (DANIEL LEAL / AFP)
HONG KONG – A Hong Kong-based trade platform launched by HSBC Holdings three years ago with much fanfare has shut down after failing to build a commercially viable business.
HSBC had invested around $70 million into Serai in the last three years, two sources familiar with the matter said, adding that Serai had started to wind up its business over the last few weeks
Serai, a wholly-owned subsidiary of Europe's biggest bank, that connected small-and-medium-sized apparel makers with component suppliers worldwide, was HSBC's first investment in a non-banking tech startup.
"The decision to wind down Serai follows a thorough business review and is a purely commercial decision," HSBC said in a statement to Reuters on Wednesday but did not give details of Serai's business or its investment in the company.
Serai also confirmed its closure in a notice on its website and said its services would not be available from June 25.
"We regret to inform you that Serai will be winding down all operations," it said.
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"Despite a huge amount of progress made by the team, it has proven difficult to build a commercially viable business. As a result, we've made the difficult decision to close our doors," Serai said.
HSBC had invested around $70 million into the start-up in the last three years, two sources familiar with the matter said, adding that Serai had started to wind up its business over the last few weeks.
Serai's platform connected buyers and sellers in the highly fragmented clothing and garments industry.
Veteran trade banker Vivek Ramachandran, who previously worked at HSBC's commercial banking business, was the CEO of Serai. Last month, Ramachandran returned to HSBC to head its Global Trade and Receivables Finance unit.
Serai's platform offered financial, environmental, social and corporate governance metrics along with analytics to enable traceability from finished products to raw materials.