As Chinese tech companies ramp up their efforts to offer financial services, BlackRock Co-Founder Robert Kapito said that existing Western firms may struggle to compete.
“This is a story that I do not think ends very well,” Kapito said at an event in Switzerland, The Financial Times reported.
In his remarks, Kapito drew corollaries to show how tech companies have disrupted various industries, saying they could shake up the financial world next.
“Apple was not in the music industry, Google was not in the mobile phone industry and Amazon was not in the groceries business — until they were,” Kapito said. “Tech companies are going to enter the financial services market in a very, very aggressive way.”
The news comes as a private funding round could make Ant Financial the world’s biggest unicorn. The Chinese financial firm — an affiliate of Alibaba — is reportedly seeking to raise $9 billion. The fresh investment could lead to a valuation of nearly $150 billion for Ant, The Wall Street Journal reported.
Ant Financial has been in discussions with potential investors. Demand for shares in the company, which owns Alipay, have been strong of late. The funding round comes as the company is eyeing an initial public offering (IPO) that could take place as early as this year. In the event that Ant Financial accrues a valuation over $100 billion, the company could be valued higher than BlackRock or Goldman Sachs.
The latest estimates for the round were up from a previous $5 billion equity funding target that could have brought Ant’s valuation to $100 billion, according to February reports. Estimates aside, the fundraising would bring the financial services company, which is still a third owned by the Alibaba Group, one step closer to its long-anticipated IPO by updating its most current valuation. Ant Financial was last valued at around $60 billion.