Dubai’s recently-launched venture capital arm, Oraseya Capital, intends to invest in over 100 start-ups within the next four to five years, a senior executive told AsianInvestor.
The start-ups can be based in the United Arab Emirates or in other regions, including Asia.
“Our primary focus is on the UAE, meaning we invest in startups that have a connection to the country—either through the founders being based here or by commercially serving the UAE’s economy. Startups in Asia can indeed apply, provided they have established ties to the UAE,” said Julien Plouzeau, partner with Oraseya Capital.
The fund, sponsored by the government's Dubai Investment Economic Zones Authority, known as DIEZ, was launched in November 2023 with $136 million.
DIEZ has about $3.6 billion in assets and has several technology-led initiatives including Dubai Digital Park and Dubai Technology Entrepreneur Campus.
Oraseya Capital is designed to finance technology startups and supports the economic objectives outlined in the Dubai Economic Agenda, D33, by promoting the growth of small and medium enterprises in various emerging sectors.
SEARCHING FOR SCALABILITY
The overarching ambition is to double the size of Dubai’s economy over the next decade.
Oraseya Capital intends to fund start-up founders focused on developing scalable solutions for challenges in large, untapped or fragmented markets, Plouzeau said.
The investment fund local companies within the city and international companies seeking to establish operations in Dubai.
Plouzeau said that several Asian startups across various sectors have already established their presence in several of DIEZ affiliates, which include Dubai Airport Free Zone, Dubai Silicon Oasis and Dubai CommerCity.
“We frequently welcome delegations from Asia to explore the economic zones affiliated with DIEZ,” Plouzeau added.
Some of Oraseya Capital’s portfolio companies include lawhive, a legal platform to find UK solicitors; letswork, a global coworking space booking platform that also operates in Asia; and souKare, a healthcare and lifestyle startup.
Middle East and North Africa (MENA) startups raised $4 billion in 2023 across 583 deals, showing a modest growth of 1.7% year-on-year, according to Wamda Research.
PRE-SEED TO SERIES B
Oraseya embraces a sector-agnostic approach, encompassing areas such as consumer apps, fintech, logistics, healthcare technology, education technology, and agricultural tecnology, along with a variety of business models.
Investment targets will include start-ups in various stages ranging from pre-seed to series B, said Plouzeau.
“Our evaluation process adapts to the startup's stage; for instance, we prioritise assessing the strength, experience, and knowledge of the founding team for pre-seed startups,” he said.
In contrast, series-B companies are expected to demonstrate a proven track record and a well-defined trajectory toward sustainable growth.
“Rigorous due diligence is integral to our process, covering technical, legal, financial, and commercial aspects,” Plouzeau added.
Dubai’s efforts to develop the technology start-up scene has strong regional parallels with Malaysia, where the government is also keen on providing a strong venture capital ecosystem.
Sovereign wealth fund Khazanah in 2023 announced the Future Malaysia programme, an initiative to spur the local start-up ecosystem via collaborations with domestic and international partners.
It has partnered with venture capital firm Antler for this project.
DEEPENING MIDDLE EAST-ASIA TIES
There has been increasing investment activity and fund flows between Asia and the Middle East over the past 12 months.
A surge in investing interest from state-owned institutions and sovereign wealth funds in the Middle East in Asia has sparked the interest of other investors from that region, including family offices, industry experts told AsianInvestor previously.
Meanwhile, Dubai has emerged as a destination for Asian wealthy families to set up operations, along with Hong Kong and Singapore.
Key investment opportunities lie in digital transformation and robotics in logistics and manufacturing, fintech and virtual assets, and tourism.
Dubai has also undertaken steps to to attract wealthy investors from Asia, particularly Hong Kong.
In addition, the UAE (of which Dubai is one emirate) is Hong Kong’s largest Middle East trading partner.