QIA’s $1bn 'fund of funds' seen as key catalyst for VC activity in Qatar

The Qatar Investment Authority’s (QIA) $1bn ‘fund of funds’, announced this year by HE the Prime Minister and Minister of Foreign Affairs Sheikh Mohamed bin Abdulrahman bin Jassim al-Thani, could catalyse venture capital (VC) activity in the country.

This was among the main points industry experts agreed upon during a panel discussion titled ‘Venture Capital Unplugged: The Ecosystem and Funding Blueprint’ hosted recently by Startup Grind Qatar.

Moderated by Salman Surti, programme lead at Qatar FinTech Hub (QFTH), the panel discussion highlighted insights from Alex Wiedmer, partner at Rasmal Ventures; Michael Lints, partner at Golden Gate Ventures; and Muhhanad Taslaq, director of investments at Alchemist Doha.

Wiedmer underscored the significance of having “more funds on the ground” in attracting VCs, noting that this would translate to more entrepreneurs. He further stated that Qatar is following the successful model of other jurisdictions where governments actively support venture capital growth.

He also explained that the impact of the fund of funds extends beyond direct investments: “Even if they don’t invest directly, these funds interact with the entrepreneur ecosystem. They advise, mentor, and attract more entrepreneurs to set up around where they are.”

According to Wiedmer, Qatar witnessed “a sharp rise in entrepreneurial activity” in the last four years. Before the prime minister’s fund of funds announcement at Web Summit Qatar 2024, he emphasised that there have been other government initiatives that have contributed to the “increase in the sophistication of projects” across the country.

Lints, on the other hand, drew parallels with Singapore’s experience in cultivating a thriving venture capital environment, citing the Technology Incubation Scheme (TIS), a government funding programme of the National Research Foundation (NRF) established in 2009. He said the impact of the TIS was significant in the “massive growth” in the number of Singapore’s VCs to almost 400 in over a decade.

Speaking on the QIA’s fund of funds initiative, Lints acknowledged its positive impact, saying: “It’s good for Qatar and the ecosystem. It’s brought a lot of attention from global funds. Today, many of them are looking at Qatar.”

But Lints also cautioned about the importance of balanced growth in the venture capital ecosystem, citing the importance of the need for “a mixture of funds that are on the ground.

Meanwhile, Taslaq underscored the importance of collaboration in building Qatar’s startup ecosystem. “One of the great things that we agreed on when we started Alchemist Doha is that we’re not here to compete with anybody. We want to work and collaborate with everybody,” Taslaq emphasised.

“Any incubation centre or accelerator in Doha is a potential partner with us. So, we’re not competing with them; we want to work with them and support the ecosystem,” Taslaq explained, saying this collaborative approach extends to all players in the ecosystem.

Highlighting Alchemist Doha’s vision for Qatar, Taslaq said: “The whole vision here is to transform Qatar into a hub for tech startups for the benefit of entrepreneurs, and that doesn’t happen without partnerships. This approach involves engaging with various stakeholders, including venture capital firms.”