Government-owned conglomerate Dubai Holding has launched a new investment firm that will focus on supporting regional start-ups, it announced on Monday.
The new company, Dubai Holding Future Investments (DHx), will “leverage Dubai Holding’s networks, assets and strategic regional position” to enable new businesses to access capital, a statement said.
DHx will also use its “specific industry expertise” to grow enterprises from smaller operations into larger, global entities, it added.
Dubai Holding, which has operations in 21 countries, currently manages an asset portfolio of Dhs130bn across sectors including tourism, hospitality, real estate, media, ICT, education, design and trade.
Its portfolio includes TECOM, Jumeirah and Dubai Properties, among others.
“The growth of innovative businesses is the future lifeblood of economies and critical to job creation, talent development and the unlocking of creative ideas,” said Ahmad Bin Byat, vice chairman and managing director of Dubai Holding.
“The MENA region is still in early stages compared to more developed markets in terms of investment into new ventures, especially in the technology sector. This has to change if we are to help the next generation build the successful businesses that will support our future economies.”
Khalfan Belhoul, the newly appointed CEO of DHx, added: “The start-up and technological potential of the region is immense, where Dubai has firmly established itself as the epicentre for commercial activity in the region.
“As the world progresses towards the fourth Industrial revolution, where technology and new business concepts will shape the way we live, there is a significant opportunity for Dubai to become a global hotbed for innovative start-ups, and venture capital investment.”
The UAE has been seeing a rise in SME and venture capital activity, and last month, also introduced new legislation on VCs to boost the competitiveness of small and medium-sized enterprises.
Under the new system, venture capital firms with assets exceeding Dhs180m ($49m) will be required to issue an annual report in compliance with IFRS standards and appoint a risk management officer.
The firm’s exposure to risk will also not be able to exceed its net asset value.
Firms with assets under management less than Dhs180m will be obligated to post an annual report summary and face the same limit on risk exposure.
Venture capital funds must also invest no more than 30 per cent of their assets in lending to new or troubled projects or equity instruments issued by unlisted companies.