Fundraising in the Middle East (Mena) | SALT Talks #168 | Summary and Q&A

TL;DR

Fundraising in the Middle East and emerging markets faced challenges in 2020 due to the pandemic, but there is a positive outlook as managers and investors adapt to remote due diligence. Established managers have an easier time raising funds compared to emerging managers.

Key Insights

• 🥺 Fundraising in the Middle East initially paused due to the pandemic but has since adapted to remote working, leading to a more positive outlook.
• 🤨 Established managers have an advantage in raising funds compared to first-time or emerging managers.
• ❓ Technology-focused sectors like edtech, healthtech, agritech, and fintech are attracting significant interest in the region.
• 🧑‍💼 Sovereign wealth funds, family offices, and international players are active investors in the Middle East.
• 🔠 Some sovereign investors deploy capital quickly through separate managed accounts.
• 🤝 There is a trend of using alternative fund structures like deal-by-deal structures or pledge funds to raise capital when traditional blind pool funds are challenging.
• 🥹 Special purpose acquisition vehicles (SPACs) have gained interest in the region, with high-profile names backing SPACs.

Transcript

hello everyone and welcome back to salt talks my name is john darcy i'm the managing director of salt which is a global thought leadership forum and networking platform at the intersection of finance technology and public policy salt talks are a digital interview series that we launched in 2020 with leading investors creators and thinkers and our g... Read More

Questions & Answers

Q: How has fundraising in the Middle East been affected by the pandemic?

Fundraising faced challenges initially in 2020, but as managers and investors transitioned to remote working, the outlook became more positive. Managers adapted by structuring deals differently and focusing on existing relationships.

Q: What sectors are attracting the most interest for investment in the region?

Technology-focused sectors like edtech, healthtech, agritech, and fintech are attracting significant interest in the Middle East. Established managers in private equity, venture capital, and credit are able to raise successive funds.

Q: Who are the active investors in the Middle East and emerging markets?

Sovereign wealth funds, family offices, and international players are actively investing in the region. DFI's also continue to invest in markets such as Egypt and Africa. Some sovereign investors deploy capital quickly through separate managed accounts.

Q: Are there specific requirements for Sharia-compliant funds?

Sharia-compliant funds have different requirements depending on the investors' Sharia board and their evolving views of Sharia compliance. Some investors only invest in fully Sharia-compliant funds, while others allow investments in conventional funds with exceptions for non-compliant investments.

Summary & Key Takeaways

• Fundraising in the Middle East was initially challenging due to the impact of COVID-19, but there is a more positive outlook as managers adapt to remote working.

• Established managers have an advantage in raising funds compared to first-time or emerging managers.

• Technology-focused sectors like edtech, healthtech, agritech, and fintech are attracting significant interest in the region.

• Sovereign wealth funds, family offices, and international players are active in investing in the Middle East, with some focusing on specific industries or strategies.