MEVP raising new fund to grow asset base following Alabbar’s investment

Walid Hanna says established firms want to invest more into the emerging asset class.

Walid Hanna said that venture capital had “taken off” as an asset class. Satish Kumar / The National
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Middle East Venture Partners is set to raise a new fund following the acquisition of about half of its business by the Emaar Properties chairman Mohamed Alabbar last month.

Speaking at a panel discussion following the launch of the Mena Private Equity Association’s annual report, founding partner and chief executive Walid Hanna said that the firm, which currently has assets under management (AUM) of US$120 million through investments in 40 companies was “very honoured” to have received the investment.

“We are going to announce a new fund soon that is going to take our AUMs from $120m to almost triple,” he said.

He said that venture capital had “taken off” as an asset class, and expects much more money to pour into the sector, pointing to the announcement last month by Saudi Telecom’s STC Ventures that it would invest $500m into the sector.

“We’ve seen very large, very soph­isticated groups – for example the Olayan Group in Saudi … they are getting more and more interested in this asset class, and they are multibillion- dollar investors.

“They have started to co-invest in start-ups alongside us. That’s exactly what they want – fund exposure, plus co-investment rights in specific start-ups that might disrupt their own bricks and mortar verticals.”

He said that there are also considerably more funding opportunities in the sector than there were when his firm, which employs 18 staff, was founded seven years ago.

“We get about 1,000 investment opportunities a year – up from 100 six or seven years ago [but] we end up investing in seven or eight companies. We end up doubling down on very few.”

Helmut Schuehsler, the chief executive and chairman of TVM Capital Healthcare, said that the venture capital industry had created “millions of jobs” and contributed to significant GDP growth in the US, but had not had the same effect in Europe.

“I think this emerging focus we are seeing on the UAE and Lebanon – two regional hubs that are able to create this entrepreneurial excitement – is a wonderful thing

“I believe if the governments in both countries support this – which they do – they will see tremendous effects on the economy over the mid to long term.”

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