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Latin America

Mystery surrounds missing Chilean venture capitalist

Alberto Chang-Rajii made a big splash in Miami, supporting entrepreneurs and befriending the likes of Richard Branson
8 Abr 2016 – 07:01 PM EDT
Alberto Chang-Rajii addressing University of Arkansas Crédito: University of Arkansas

A once high-flying Chilean investor and would-be space traveler who made a name for himself in Miami’s budding tech scene, Alberto Chiang-Rajii, is on the run after allegations about his business record and the soundness of his financial operations, according to media reports and a source close to the firm he founded.

Chang, president of Grupo Arcano, an international private equity and venture capital firm, was reported missing by various Chilean news outlets on Thursday after he penned a mysterious email to his mother and company executives, raising concerns that he was suicidal.

In the email, signed from the Mediterranean island of Malta, Chang-Rajii said he felt “beaten," according to the Chilean media reports. Chang wrote that he was retiring "from this life."

His friend and business associate, British billionaire Sir Richard Branson, responded to uncertainty over Chang's fate telling Univision he was "saddened" by the reports.

Several Grupo Arcano executives announced they had resigned from the company on Thursday after receiving what they described as the "troubling" email. Chang was also being investigated by fiscal authorities in Chile, local media reported.

Grupo Arcano, which has a branch in Miami, closed its doors in Chile on Thursday as worried investors demanded to know what had become of their funds. The company's closure comes as Chile is reeling from political and business corruption scandals that have eroded the government's popularity.

Chang founded Grupo Arcano in his native Santiago, Chile in 2001. The company has additional offices in Miami, London and Sydney and says it has 700 emplopyees. Arcano grew fast in recent years and was thought to be worth several hundred million dollars. One of its funds, Onix Capital, attracted investors by offering 20% annual returns, far above market rates.

A spokeswoman for Grupo Arcano in Chile declined to comment earlier this week when contacted by Univision. She stopped answering her phone and emails on Thursday.

Chang's Miami attorney, Juan Pablo Cappello, did not respond to a request from Univision to comment for this story.

Since opening offices in Miami in 2011 Chang nserted himself in the city’s burgeoning tech startup scene, as well as befriending wealthy international entrepreuers, including Branson, founder of the Virgin Group.

Chang signed up as a “Future Astronaut” with Branson’s Virgin Galatic project to launch the world’s first commercial space travel venture. He also bought land in the British Virgin Islands near Branson's vacation home on Necker Island, according to one source close to the company.

Chang supported a Virgin charitable bursary at Oxford University to promote a $3 billion higher education fund, according to he website of Virgin Unite, the company’s entrepreneurial foundation.

In a statement on Friday emailed to Univision, Branson said; "I am saddened to read the reports about Alberto Chang. Clearly, this is a developing situation and it would not be appropriate to comment until the facts become clear."

The website of Virgin Unite includes a full page dedicated to Chang including photos with Branson.

“Through this success he has been able to focus his passion for innovation and positive impact in the world – in a number of areas, from education to space travel,” it says.

Chang was named last year to the United Nations Global Entrepreneurs Council.

Grupo Arcano CEO Jorge Hurtado sought to downplay concerns about the fund in an interview with El Mercurio last month, highlighting the firm’s recent investments in Uber, Snapchat and NextU, a Miami-based digital technology university. Hurtado denied that Arcano was a pyramid scheme, though he told Mercurio that its sustainabilioty depended on securing new investors.

Another of his recent investments was Cambridge Quantum Computing Ltd., a company in the U.K. seeking to develop the next generation of super computers.

Sources familiar with efforts to locate Chang-Rajii told Univision he had summoned executives to a meeting in Switzerland last week to answer allegations that he was running a Ponzi scheme, only to stand them up. He later turned up in Malta, according to one source close to company executives.

Chang has been under fire since it was revealed late last month that he misrepresented parts of his biography including a claim that he earned a degree from Stanford University and was an early investor in Google.

He abruptly resigned his post last week as a board member of Endeavor Miami, an entrepreneurship non-profit. On Monday, the eMerge Americas technology and innovation conference, also based in Miami, announced it had dropped Grupo Arcano as a presenting sponsor for its startup showcase.

Xavier Gonzalez, CEO of eMerge Americas, declined to comment. Conference organizers had previously highlighted Grupo Arcano’s “global reputation and proven ability for identifying and supporting the best and brightest tech talent.”

Chang reputation began to unravel when administrators at Stanford University told the Miami New Times that he never attended the school. Sources familiar with Google also challenged Chang's story about owning a 1% stake in the company.

Chang updated his bio on the Grupo Arcano website last week removing any mention of having obtained a degree from Stanford. In other company literature he claimed to have a post-graduate degree in Behavioral Sciences from Stanford, as well as becoming “one of Google’s first investors.”

The non-profit Endeavor Miami also sought to play down Chang’s resignation.

“Alberto Chang resigned … to focus on his affairs,” Endeavor Miami managing director Laura I. Maydón stated in an e-mail. “We are thankful for his support to Endeavor Miami these past years,” she added.

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