The Qatar Investment Authority (QIA) is investing nearly $1 billion to attract venture capital firms to Qatar, addressing a funding gap for startups. The initiative aims to create jobs and develop technologies in key sectors. Over 120 applications have been received, with six firms committing to Doha. QIA is also revising business regulations and cutting fees to enhance the investment climate.
The Qatar Investment Authority (QIA) is allocating nearly $1 billion through its Fund of Funds program to attract six venture capital firms to establish their regional headquarters in Qatar. This program follows a three-year study aimed at addressing a significant funding gap for startups scaling in the country, particularly at Series A and beyond. Mohsin Pirzada, QIA’s head of funds investment, emphasized that capital is available for early stages, but the gap exists for subsequent funding rounds.
QIA, managing over $500 billion, is willing to sacrifice some financial returns from foreign venture capital investments to promote job creation, technological development, and enhancement of critical sectors like renewable energy, AI, and food security. Pirzada noted that the approach is more about engaging with stakeholders to cultivate a robust ecosystem rather than merely providing capital.
To date, the program has attracted more than 120 applications, with six firms committed to moving to Doha. QIA is currently reviewing eight additional proposals. One of the firms receiving support is UTOPIA Capital Management, which focuses on early-stage startups in regions such as Southeast Asia, Africa, and the Middle East, specifically in sectors like fintech and health tech.
UTOPIA has already raised $40 million for its fund in the Middle East and aims to invest up to $850,000 in early-stage companies. They are evaluating a Qatari health tech startup for potential expansion into Africa, reflecting an intention to infuse innovation from various markets into Qatar.
QIA has also made significant investments in firms like Builders VC and B Capital. In response to competition from the UAE and Saudi Arabia, Qatar is enhancing its business landscape by reducing fees and improving regulations to attract more investors and startups. This includes slashing licensing fees by 90% to stimulate foreign investment inflow.
The QIA’s initiative to establish a $1 billion Fund of Funds aims to bridge the funding gap for startups in Qatar, enhancing job creation and technological advancements. With a focus on engaging venture capital firms and attracting innovation, QIA is positioning Qatar as a pivotal hub for investment in the region amidst increasing competition from neighboring countries. Strong commitments from various firms indicate a promising future for the startup ecosystem in Qatar.
Original Source: www.semafor.com
