Old Mutual Global Investors' Hong Kong office, the firm's only location outside the UK that manages assets, now has 12 people. Tonkinson expects to increase staff by 30% over the next 12 months.
"We decided not to run [the Asia business] out of London, but to be in tune with the local culture by establishing a full-fledged local presence. We're not a sales hub, but a business in Asia."
Several senior appointments in Hong Kong over the last 24 months increased capability in marketing, product management and risk and compliance.
Earlier this month, the Asian equities team received regulatory approval to operate from the firm's Hong Kong office, marking the first time the business will have on-the-ground fund management capabilities in Asia.
The firm also recently hired Simon MacKinnon as Asia strategy adviser to support the regional expansion of its asset and wealth management units.
"I think our plans for Asia are extremely ambitious," Tonkinson said. "We want to replicate the success of the UK market."
Fund launches planned
OMGI manages $500m in assets in Asia, the bulk of that in Taiwan, currently its largest regional market. In Taiwan, the firm works through master agent Capital Gateway, which is the firm's exclusive distributor, he said.
Tonkinson believes the funds that OMGI sells globally have regional appeal, such as the Emerging Markets Debt fund, and new capabilities specifically for Asia are underway.
Over the next 12 months, the firm aims to launch 3-4 funds in Asia, he said, but declined to give details.
"Our intention is to build out what Josh [Crabb] and his team manage."
He added that the expected mutual fund recognition scheme between Hong Kong and China is "potentially very significant".
"In terms of distribution, we're watching very closely the mutual recognition scheme in Hong Kong and at same time working on who our distribution partners will be in China."
The firm is taking a wait-and-see approach, but at the same time is talking to advisers to understand the shape the scheme is likely to take and the time scale involved.
"I would expect that if things go according to plan, we'll have a range of Hong Kong-domiciled funds in the future."
The firm sees growth opportunity in the Taiwan business and is eyeing new client segments in the region. According to Tonkinson, 80% of OMGI's funds assessed over the trailing three years fall in the first or second quartile.
"There is no reason to restrict our [distribution] to Hong Kong, Singapore and Taiwan."
Getting noticed in the crowd
The decision to go local involved a series of challenges because of the highly competitive regional landscape, Tonkinson said. Most of the big fund houses have already established footholds.
"What surprised us most is that there is demand for new asset management firms in the region. Clients have been saying that it is refreshing to have a new name in Asia."
The Old Mutual brand more has more resonance in the UK than it has historically in Asia, he said, and therefore the branding budget has been increased throughout the region.
"Asia is a very competitive market with a lot of global brands. The key for us is how we establish our brand and brand values associated with it."
The firm aims to convey that OMGI is an innovative, modern fund house with a range of investment funds, he said.
"Getting that message across is challenging because it's a very crowded space. It takes time and investment. We've made great strides - our brand is a lot more visible than it has been - but we have a long way to go."