UAE’s VentureSouq reveals $50m venture fund to support FinTech

VentureSouq, the UAE investment company focused on early stage technology businesses, unveiled a $50 million venture fund that is aimed at the FinTech sector.

Its Mena FinTech Fund I will support FinTech and softwareas-a-service companies. The fund is backed by major regional investment houses, including Abu Dhabi’s Mubadala Investment Company, DisruptAD, the venture capital platform of Abu Dhabi’s holding company ADQ, Saudi Arabia’s Jada Fund of Funds and Saudi Venture Capital Company, Bahrain’s Al Waha Fund of Funds and OFC, the Middle East investment arm of The Olayan Group.

It will focus on key sub-sectors such as payments infrastructure, alternative credit, digital banking, property technology, insurance technology and personal financial management. It will also work closely with regional entrepreneurs who are at the forefront of leading financial disruption.

The evolution of Mena’s FinTech ecosystem is still in its “very early days” but the sector’s foundational layers are beginning to face disruption, said Suneel Gokhale, a general partner at VentureSouq.

“Our view is that now is a great time to be investing in what we think will be the next batch of FinTech unicorns [start-ups with a valuation of $1 billion or more],” Mr Gokhale told The National yesterday.

“We think it was a matter of time; you have FinTechs challenging incumbents across the globe through better user experiences and less friction, and in the end better products that hack distribution more times than not will win.

“Consumers and businesses here in Mena want to benefit from that as well and now we are at a point in time where talent, access to capital and government/regulatory support is very strong, resulting in the rapid emergence of FinTech challengers, which is especially true here in the UAE, which is now universally regarded as a great place to build a business and a life.”

The region’s FinTech sector continues to gain traction as more consumers turn to digital payments services, accelerated by the Covid-19 pandemic, presenting an opportunity for companies, particularly startups, to provide new and additional services to cater to the growing demand.