DIFC looks for next billion-dollar start-up
FINTECH ACCELERATOR’S SECOND EDITION SET FOR NOVEMBER 27
Raja Al Mazroui believes it’s only a matter of time before one of the start-ups participating in her programme ends up becoming a billion-dollar company, otherwise known as a ‘unicorn’.
That programme is Dubai International Financial Centre’s (DIFC) Fintech Hive, a threemonth accelerator designed to mentor and connect young tech companies with potential partners in the financial and legal industries.
Launched together with Accenture in 2017, the programme has almost doubled in size for its 2018 run, which begins on November 27. This year it has partnerships with 21 institutions compared to 11 in 2017 and will welcome 22 startups into the accelerator, twice more than it accepted last year.
The accelerator essentially pairs start-ups with established banks and insurance firms, which in turn help to fund the programme alongside DIFC. This benefits both parties, according to Al Mazroui.
The start-ups are able to deploy their technology and potentially receive funding from the institutions, while banks gain technology that can solve their problems. To streamline this process, DIFC asks the banks what type of technology they are looking for and which area they’re looking to improve, and then look for start-ups that address these issues.
“This year, we were able to attract more financial institutions, and engage them in the innovation conversation,” said Al Mazroui, Fintech Hive’s executive vice-president.
Financial partners this year ■ include Emirates NBD, First Abu Dhabi Bank (FAB), HSBC, Standard Chartered and Visa, while insurance partners include AIG and Zurich Insurance. Then from a field of over 300 global applicants the start-ups are selected, given visas and invited to set up in DIFC’s dedicated Fintech hub. The only requirement is that a start-up already has at least one client.
‘Speed dating’ pitch
Once in Dubai, the start-ups are invited to pitch their companies to dozens of companies and government officials. “We call it the speed dating process. We take them to each and every financial institution to pitch their technology in detail. Sometimes the bank brings 100 people to attend the pitch,” Al Mazroui said.
This year, some banks have as many as eight companies to mentor. “The start-up gets mentorship, which is really important for them to access the market.” Some also receive funding, and proof of concepts between the banks and start-ups. Last year’s graduates from Fintech Hive have since received $10 million (Dh36.72 million) in funding. Al Mazroui said she expects the amount of money raised by start-ups to be even greater.
Soon, DIFC will itself begin to invest in fintech start-ups. In November 2017 it announced that it would be launching a $100 million investment fund dedicated to fintech.
This year’s start-ups are noticeably different from last year’s in one key respect: they represent a broader spectrum of industries. Beyond fintech, the 2018 batch includes insurance technology, regulatory technology and Islamic financial technology.
Of the 300 applications, 50 per cent were divided among insur-tech (20 per cent), Islamic fintech (15 per cent) and reg-tech (15 per cent). Will Fintech Hive breed the region’s next billion-dollar start-up? Al Mazroui said: “That’s my vision; I hope to see that very soon.”