Abu Dhabi’s state fund, Mubadala Investment Company, has announced its plans to invest $250 million in technology firms in the Middle East and North Africa through two dedicated funds to capitalise on the growing startup scene in the region.
Earlier this year, the UAE capital launched a dedicated hub to attract technology start-ups, called Hub71, as part of a broader effort by the government to diversify its economy. With a roster of international partners that include Softbank and Microsoft, Hub71 offers incentives like office space and health care coverage to encourage start-ups to set up shop in the region.
The latest investments include a $150 million fund that will invest in technology funds and $100 million specifically targeting early-stage companies, explained Ibrahim Ajami, head of Ventures at Mubadala Capital. These are specifically companies that will be part of the Hub71 development. The fund aims to invest in a portfolio of 15 firms.
The first investment from the direct fund is in Bayzat, a UAE-based company providing a free platform for human resources, payroll and employee benefits. So far, Bayzat has secured $16 million in Series B funding with its focus on delivering an exceptional employee experience accessible to every small and medium-sized enterprise through a free cloud-based platform.
The funding round was led by Point72 Ventures and is Mubadala Capitals’ first investment in a UAE-based startup. Other participants in the funding round include Elm, Greyhound Capital, Endeavor Catalyst, and Tech Invest Com.The company has now raised a total of $31 million which it plans to invest in its technology and customer experience.
The UAE is not alone in increasingly focusing their investment into local tech ecosystems. It is a growing trend among countries in the Middle East, looking to reduce their reliance on oil-dependent industries.