On Monday, Qatar’s sovereign wealth fund announced its plan to allocate more than $1 billion to international and regional capital funds. This initiative forms part of a broader strategy aimed at fostering the growth of the venture capital and startup sector in Qatar and neighboring gas-rich Gulf states. The Qatar Investment Authority (QIA) specified that the “Fund of Funds” venture capital initiative is anticipated to generate commercial returns in line with market norms, contributing to the enhancement of Qatar’s venture capital and startup ecosystem.
The program will attract leading international VC funds and entrepreneurs to Qatar and the wider GCC region, bringing deep VC and startup expertise while contributing to the growth of a local and regional venture capitalists and founders base. The Fund of Funds will focus on the tech sector, including fintech and edtech, as well as healthcare. The Fund of Funds will primarily invest indirectly through other VC funds but can also make targeted co-investments. It will not invest in private equity or debt.
According to QIA CEO Mansoor Ebrahim Al Mahmoud, the Fund of Funds will enable innovative businesses to bridge the existing funding gap after transitioning beyond the seed stage. This will facilitate their growth and accelerate their progression into critical sectors such as technology, fintech, tech, and healthcare. This will contribute to Qatar’s vision of harnessing innovation for societal advancement and economic resilience.
Qatar is considered one of the most active regions in the Middle East for entrepreneurship and startup activity. It has a growing network of incubators and accelerators and several initiatives supporting Edtech startups and innovators. These include the Qatar Foundation WISE Edtech Accelerator Program, which supports entrepreneurship in Education Technology, and Doha Learning Days. This annual event takes education outside of traditional classroom settings.
However, there are several challenges that startups in Qatar face, including high operating costs and regulatory complexity. While the government has made progress in simplifying bureaucratic procedures, startups still need help to navistartupsditionally; it can be challenging for startups to understand and adapt to cultural differences when doing business in Qatar.
Launching the Fund of Funds will help address these issues and support the growth of entrepreneurship in Qatar and the wider GCC region, thereby fostering the development of a diverse and resilient economy. It will also create jobs and drive the local technology sector, an integral component of Qatar’s National Development Strategy. It is expected to significantly impact Qatar’s economy and bolster its reputation as a world-class hub for innovation and entrepreneurship. The Fund of Funds will be managed by a specialized team at QIA, working closely with Qatar’s VC and startup ecosystem to identify promising opportunities and invest wisely.
