For targeting the initial stage firms, newer $25million Abu-Dhabi Venture Fund provides its nod

The Access Bridge Ventures is wholly backed from Mubadala Capital, Saudi Venture Capital Firm as well as a number of family offices.

The latest Abu-Dhabi-based venture capital firm has finished the initial closure of its $25 Million debut funding investment.

The firm stated that: The Access Bridge Ventures’ fund is wholly backed through, Saudi Venture Capital Company (SVC) and a number of other investors, including Mubadala Capital “several prominent family offices.

As accordingly to the Managing Partner and Co-Founder Issa Aghabi stated that: “It will invest in initial phase of the businesses across the Middle East, North Africa and Pakistan.” We’ve developed a spectacular network of stakeholders over the years – be it investors, entrepreneurs we’ve supported and helped [or] government and sovereign stakeholders we’ve worked with in the past,” Mr Aghabi stated to The National.

Mr Aghabi was formerly the chief of the International Finance Corporation’s venture capital investments and funds in the territory. Preceding to that, he was head of investments at Abu Dhabi’s media zone authority TwoFour 54.

He co-founded Access Bridge Ventures with Rakan Alrashed, who was formerly part of a Saudi Arabian investment firm that engrossed on start-ups and SMEs. The pair have also team up up with Dubai-based private equity firm CedarBridge Capital Partners.

The venture space in the Mena territory is becoming progressively active. The previous year, there were 243 funding institutions in the MENA territory, up from 235 a year earlier, conferring to the 2021 Emerging Venture Markets Report due to be issued by Magnitt later this week.

It expresses funding institutions as venture capital firms, angel networks, corporate venture corporations, accelerators and other entities that take equity stakes in start-ups.

Few of the funds recognized over the past 12 months include the Dh535 million ventures fund that is part of Abu Dhabi’s Ghadan 21 initiative and the Dh1.1 billion Alpha Wave Incubation Fund aiming businesses from India and South-East Asia.

Mr Aghabi further stated that: “There is cash availability (and) that there are people investing within the value chain, however the query that arise is Is there enough? It depends on what market you are looking at.”

Few Nations are well-served, however, others like that of Egypt, Jordan, Lebanon, as well as Pakistan are not, he argued it. Even in the UAE, few parts of the market are rewarded more attention than others.

“We’ve identified a core gap in the market, which is at initial stages … pre-Series A,” Mr Aghabi said.

The superior availability of venture capital in the territory means the most dynamic funds are commonly doing bigger deals, he said.

“They can’t afford to waste their time on seed [funding rounds], because when you are a large fund you need to spend that money in a finite period of time. Bigger cheques make more sense, he added.”

He anticipates the average preliminary investment from his firm’s fund will be around $500,000, although “we can go lower”, he said. Those that thrive are also likely to receive follow-on funding. Access Bridge Ventures is directing investments in a range of areas including FinTech, health tech, educational technology, software as a service and others.

The first fund will reach final closure within the next 12 months and could be larger than the initial $25m target, depending on investor appetite, Mr Aghabi said.

He expects the fund will be fully invested over a four-year period, although exits could take up to four more years to realise. Having CedarBridge as a partner will bring “a different proposition”, he said, adding a robust focus on accomplishing successful exits and on governance.

“I wanted that thrust from experienced investors in this space to bring that discipline to venture capital,” he said.

The International Monetary Fund estimates that micro, small and medium-sized enterprises make up 96 percent of all recorded businesses in the MENA territory and provide about half of the total jobs in the territory. The International Finance Corporation estimates there is a total financing gap to MSMEs in the territory of up to $240bn.

Access Bridge Ventures will be based at Abu Dhabi Global Market.

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