Apr 10, 2014
A Silicon Valley-based venture capital firm is looking to raise a $100 million fund to be partly invested in early-stage startups across the Middle East.
Founded in 2012, Fenox Global will use the cash to offer seed, series A and pre-IPO funding in the U.S., Asia and the Middle East, where it will focus on information technology startups, healthcare and clean tech.
The firm has $10 million committed and is also on the hunt for more cash from Middle East investors. Its current investment portfolio includes Dream Link Entertainment, which recently listed in Tokyo, and Lark, a wearable technology company.
“I know of no other time that a Silicon Valley VC has used capital from Middle East investors to promote entrepreneurship in the local region,” Brent Traidman, general partner at Fenox said in a statement.
The sophistication of VC funding in the Middle East, excluding Israel where there is a thriving tech scene, has been limited for many years. VC funds and private equity firms from outside the Middle East have invested in the region, but tended to focus on bigger rounds of funding to well-known local internet and e-commerce success stories, such as Namshi.com and Souq.com.
However, this year has seen more movement in the series A and seed funding space. Dubai-based entrepreneurs Arya Bolurfrushan and Paul Kenny in December foundedEmerge Ventures to invest in tech advertising, mobile, payments and logistics.
What’s more, Fadi Ghandour, the founder of logistics company Aramex and serial entrepreneur, has teamed up with the International Finance Corporation to launch a fund of about $75 million to invest $1 million and $3 million in startups. The central bank in Lebanon has also launched a scheme to support banks and VCs in funding entrepreneurs.
In its quest for Arab funding and startups, Fenox Global has teamed up with i360accelerator, a seed fund and development program for early stage startups run out of Dubai. But the number of Middle East startups raising money from a potential $100 million will be few.
“Fenox sees the huge opportunity for growth in the MENA region, and so we are offering funding and expertise to a few best-in-class regional startups who we believe will provide significant long-term gain,” Kamal Hassan, Fenox general partner and operator of i360accelerator, added in the statement.