There are few within the superyacht market who have enjoyed continued success within a region for three decades. But Mike Simpson, founder of Simpson Marine is someone who has weathered this stormy industry, establishing himself as one of the foremost Asian service providers.
Speaking to me at the Singapore Yacht Show earlier this month, Simpson’s expertise shines through. In 33 years, the company has sold over 2,000 yachts, with over 50 above 30m (100ft) to Asian owners. He is well-placed to see opportunity for change and drive it forward including a new service EPower, which aims to ameliorate the financing difficulties found in the region.
“Since we started the business out here, financing was always an issue. We’ve always struggled to get financing on yachts, we’ve always had to do it on a case by case basis, and usually it’s a question of having to convince banks or financial institutions that the risk is worth taking, because they see this as a floating asset that can just float away,” Simpson explains. As has been well documented, the Asian superyacht market is in its infancy, meaning the services surrounding yacht acquisition can be limited.
EPower acts as a level of security for both owner and bank, with Simpson Marine retaining a level of ownership of the yacht. This offers more financial protection for all parties involved, as Simpson Marine backs the customer and also has a means of re-selling the yachts if their owners default on payments, “We can evaluate customers better, which is one of the issues. That means that if a customer defaults, we have a very quick turnover of second-hand yachts so we can move yachts on very quickly and not stuck with a growing inventory of boats with defaulted owners,” says Simpson.
The new service is also a result of issues Simpson’s previous clients encountered when financing a yacht and then wanting to move it between different waters within the region - evidently, an issue for yachts. Simpson Marine’s multiple offices negates this red tape: “We have offices around the region, meaning the yacht is going from one of our offices under the care of our office in Singapore, into the care of our Malaysian operation, into the care of our operation in Thailand, which means we retain control.”
Simpson Marine’s success exemplifies how vital it is to understand the local industry. According to Simpson, many European-based companies attempt to break into the area and are disappointed when they don’t see results straight away. “If you want to succeed out here, you need to have some roots here. You need to understand the local culture, you need to invest heavily in order to get a return, because the size of the market is still so small, compared to other parts of the world, I think that’s a fundamental point, which a lot of people ignore. They see the potential here - which is huge - but they forget that really it’s a tiny market still.”
This must be a recipe for success in the Asian market, as Simpson Marine reports two sales from the Singapore Yacht Show, yet another positive sign for the region.