Qatar Doha skyline.
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Qatar Investment Authority is leveraging its $500 billion in assets to attract venture capital companies to hydrocarbon-rich provinces.
The Sovereign Wealth Funds’ Funds of Funds program, which invests in both international and regional VC funds, is designed to enhance investments in sectors such as technology and healthcare as Qatar seeks to diversify away from the dominant oil and gas industry.
Currently accepting the first group of venture capital fund managers.
B Capital, a tech-focused company led by Facebook co-founder Eduardo Saverin, is one of the VCS groups to be launched in Doha, opening its first Middle East office in Qatar’s capital. He is involved in Rasmal Ventures, Utopia Capital Management and Builders VC.
Raj Ganguly, co-CEO of B Capital, welcomed the Gulf’s approach to artificial intelligence and its support for its sector, particularly interesting.
“I think it’s an incredibly exciting time with all the sandboxes created to trial for a new type of AI here at GCC (Gulf Cooperation Council),” Ganguly told CNBC, Web Summit Qatar in Doha on Monday. “We believe innovation comes from anywhere. We want to support the founders of GCC, who have a global mindset.”
Focusing on companies, fintech, healthcare and climate investments, B Capital says it manages more than $7 billion in managed assets and targets the species of late growth technology investments.
Morsin Pilzada, QIA’s Head of Finance – The huge sovereign wealth fund with a prize asset interest, from French football team Paris Saint-Germain to London’s Heathrow Airport, told CNBC that the program has a double investment obligation.
“First, we are looking for strong commercial returns and secondly, we are looking for a positive impact on Qatar’s entire VC ecosystem,” he said.
He added that he is looking for VCs whose funding is trying to deepen their domestic roots. “We aim to have a beneficial impact on the local economy, boost the flow of trading in the market and support the development of a prosperous ecosystem supported by the strong private sector,” he added.
Doha Test
This move comes as Doha faces certain challenges in attracting financial services companies. In addition to boasting a young, digitally savvy population, many countries in the Middle East also offer incentives to seduce well-known financial services companies.
Riyadh, for example, launched a program in which businesses seeking government contracts will move their regional headquarters to Saudi Arabia and offer corporate tax incentives. The Kingdom has seen several Wall Street companies move to the Saudi Arabian capital, including Morgan Stanley, Goldman Sachs, Lazard and BlackRock.
The United Arab Emirates have all set up offices in the capital, Abu Dhabi, targeting global companies, as well as billionaire Ray Dalio, hedge fund Brevan Howard, asset manager PGIM and private equity giant Atlantic.
“The keyword here is “compliment.” This is a relatively small area. So, when one country wins, we all win. If we are all helping businesses, innovators and businesses expand, we will all benefit,” Qia’s Pilzada told CNBC.
