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Wednesday / May 15.

Mubadala expands venture capital business to Europe

LONDON: Mubadala Investment Company is expanding its tech investment strategy to Europe, with the launch of a new $400 million fund to invest in the continent’s “high growth technology companies with global scale and impact.”

The new initiative, announced on Wednesday at London Tech Week, is the first significant expansion of the Abu Dhabi sovereign wealth fund’s venture capital arm, Mubadala Ventures, and deepens its collaboration with Japan’s SoftBank.

The $400 million fund will work closely with early-stage UK and other European funds to invest in “both established and emerging fund managers across the continent,” Mubadala said in a statement.

Mubadala Ventures will also facilitate the process for European tech companies to establish operations in Abu Dhabi to target the Gulf and Middle East markets, via a European fund of funds and a direct funding strategy.

SoftBank, a key investor in a US-focussed $400 million fund established last year, will participate in the new European fund via its SIMI US Holdings I, Inc. investment subsidiary.

“Mubadala’s investment approach is based on partnership and this is exemplified through the strong working relationship we have established with the SoftBank Group,” said Waleed Al-Muhairi, CEO of alternative investments and infrastructure at Mubadala.

“The launch of a $400 million fund to support the growth of pioneering entrepreneurs complements Mubadala’s global portfolio of investments across the full spectrum of the tech sector.”

Mubadala established Mubadala Ventures — based in San Francisco — last October, creating a vehicle to oversee its $15 billion commitment to SoftBank’s Vision Fund, alongside the $400 million Mubadala Ventures Fund I and a $200 million fund of funds.

“The UK and Europe has some of the world’s most exciting startups and we would like to see more companies accelerate through the startup stage to achieve sustained growth at a global level,” said Ron Fisher, director and vice chairman of SoftBank Group.

The UAE and Saudi Arabia have targeted investments in fast-growing international technology companies as part of their economic diversification strategies in a bid to lessen their economies’ reliance on oil revenues.

Mubadala and Saudi Arabia’s Public Investment Fund are among the largest contributors to SoftBank’s Vision Fund, the world’s largest private equity investment vehicle. The fund’s recent investments include a $2.25 billion injection into GM Cruise, the car giant’s autonomous driving unit, and a $5 billion stake in US chipmaker Nvidia.

Mubadala’s own tech invesmtents include stakes in semiconductor-makers AMD and Globalfoundrues, Abu Dhabi-based YahSat, and UAE-based telco du.

The fund’s deepening involvement in the venture capital sector will provide a boon to international startups, according to Dany Farha, co-founder and CEO at Dubai-based BECO Capital.

“Deep and patient capital is required as the lifeblood at all levels of the innovation lifecycle for there to be the appropriate incentives in place to mobilize innovators and entrepreneurs,” Farha told Arab News.

via AN