MANAMA: A new $60 million venture capital fund based in Bahrain will invest in 120 early-stage start-ups across the Mena region amid an anticipated boom in tech post-Covid-19.
Plus Venture Capital (+VC) is led by ex-Google executive Sharif El Badawi and Silicon Valley venture capital firm veteran Hasan Haider, who bring more than 35 years of combined investing and operating experience and have completed more than 200 transactions together.
With key operations in Bahrain, and offices in Saudi Arabia, the UAE and Egypt, the firm will invest in sectors including fintech, healthtech and edutech in addition to logistics, content and e-commerce at a time when fund managers say capital is “barely keeping up with the pace of Middle Eastern innovation”.
Reports quoting data from Startup Genome say global venture capital (VC) funding has plunged 20 per cent worldwide since the coronavirus outbreak in December last year.
However, regional data platform Magnitt says despite the impact of Covid-19, more than $659m was invested in Mena-based start-ups in the first half of 2020 – representing a staggering 95pc of total VC funding in the previous year.
Mr Haider said, “The Mena start-up scene, rather than being crushed by the pandemic, has bounced back with renewed vigour. Major market slumps usually lead to big rebounds – the 2008 financial crash is just the most recent example.”
Tech companies emerged the clear winners from the last downturn, and this time around the Middle East is ideally placed to leapfrog other major start-up economies as the recovery gets underway, he added.
Offering a young, highly-connected market of more than 400m people with similar cultures and languages, the Middle East is fast emerging as a key start-up ecosystem, having seen several recent exits including the $3bn acquisition of Careem by Uber in 2019 and Souq by Amazon in 2017.
“Plus Venture Capital plans to invest in a diversified portfolio of seed-stage startups over the next three years, with a target of 120 firms,” said Mr Haider.
According to him, the firm would leverage the founders’ “deep personal networks” built on a “five-year legacy of investing in start-ups with exceptional deal flow”.
As an entrepreneur and former investment banker, Mr Haider has been investing in start-ups for the past 10 years, and established one of the first angel investment groups in the region.
His partner Mr El Badawi is a serial entrepreneur, operator and investor, who worked at several Internet companies since the mid-90s in Silicon Valley, including Google, before moving to the region to focus on start-ups.
“Having invested in startups over the years, we can provide experienced practitioners as well as access to a unique network of operators, mentors and investors to the businesses that we invest in,” said Mr El Badawi.
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