Introduction
The Middle East has been deeply involved in the global alternative investment industry. It hosts some of the world’s biggest sovereign wealth funds and thousands of large family offices that are looking for new investment opportunities.
The last few years have also seen several successful venture capital firms and startups emerge from the region, making a mark on the entrepreneurial map.
Add to it the serious push by regional authorities to attract investment funds to set up their base in tax-friendly jurisdictions, and the Gulf is certainly buzzing with activity in the private market.
While global headwinds and a tight liquidity environment impacted private equity and venture capital deals across the world, key markets in the Middle East emerged as bright spots. Overall, PE and VC deal value and the number of transactions in the region edged lower in 2023. Total deal value fell to $11.5 billion in 2023 from $15.7 billion in 2022 while the number of transactions slipped to 430 from 728, according to S&P Global Market Intelligence data.
However, Saudi Arabia recorded an uptick in venture funding activity. The kingdom recorded a 33% growth in the value of VC deals in 2023 to $1.38 billion, although the number of deals fell to a three-year low of 125 from 157 in 2022, data by Magnitt showed. It was led by four mega deals worth a total of $879 million, including buy-now-pay-later platforms Tabby and Tamara.
That said, even though the startup world has seen a cooling off after the heady days of 2021, in sync with global trends in the technology space, the entrepreneurial zeal in the region is well preserved.
To gauge the investment opportunities in the region and assess how can limited partners (LPs) leverage their financial muscle to not just create returns but do so while pushing sustainability and the cause of seeing companies scale up with Middle East as their home base, VCCircle, the largest emerging markets publication tracking the alternative investment ecosystem, is organizing the inaugural Dubai chapter of its flagship LP event in India. The LP event in India is now in its milestone 15th edition.