UAE Wealth Fund Sets Up Abu Dhabi Tech Hub
Mubadala, the Abu Dhabi sovereign wealth fund that controls $225 billion wants to attract the start-ups producing the latest technology in the world to the emirate. Its strategy to do so is to set up a new tech hub in Abu Dhabi with the lure of $367 million to be invested over 5 years into funds and start-ups. As well as the promise of funding for new start-ups who choose Abu Dhabi as a base, Mubadala also hopes that heavily funded tech start-ups and growth companies such as the UK’s VR star Improbable, Oyo, SenseTime, Plenty and WeWork can be convinced to set up offices in the hub.
All of the exciting tech start-ups mentioned have seen Softbank’s Vision Fund take major stakes in them, investing significant capital in return for equity. Mubadala, in turn, has invested $15 billion of the $100 billion capital managed by the Vision Fund. The fund now wants to leverage that investment in its efforts to diversify its economy away from the current reliance on fossil fuels.
An official announcement on the new tech hub, which it is reported will involve a partnership with Microsoft offering its technology and Cloud service to companies located in the new facility, is expected to be made on Sunday. It is hoped that the presence of the best international technology start-ups side-by-side with promising local and regional companies will give the latter a huge boost from tech and management knowledge transfer.
A further, connected, benefit thought to be a strong motivation for the level of investment the emirate is making in start-ups and the new hub is employment opportunities for local youths. A much higher than desirable percentage currently work in state administration roles which are less than demanding and don’t particularly encourage the development of the kind of skills required in the modern, international digital economy. The state bureaucracy is a much bigger employer than necessary of efficient – at least partly a conscious effort to provide employment for the local emirate population.
Hub 71, as it will be named after the year the UAE was founded in its modern form, is planned to host around 100 start-ups. The composition of that ‘steady state’ will change over time as new tenants move in to replace other who are either moving on to larger premises or have failed to gain traction. Amazon and Softbank are already unofficially confirmed as set to run offices from the hub, which will be spread over 4 floors of a Class A office building in the city’s financial district.
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