News

Middle East venture capital grows six times over

ProfitThe amount raised by the Middle East's nascent venture capital industry grew six times over last year, prompting predictions of further gains this year that may match the growth rate seen in India.

Start-up companies in the Middle East raised a combined $175 million in 2014, according to the chief executive of BECO Capital, a venture capital firm focused on technology investments. In 2013, they raised $29 million, he said.

"The region is gaining momentum and is on the way to experience its own boom in the technology sector in the next five years, following on India's success story," said Dany Farha, who addressed a conference in Kuwait.

Venture capital, which extends funding to entrepreneurs and early-stage companies, has developed rapidly in emerging markets in recent years. India's venture capital industry is now worth more than $2 billion, according to Farha's figures, up from $800 million in 2009.

The Middle East has some way to catch up with the scale of venture capital investment in India, but Farha says technology firms in Gulf countries could soon see a boom in early-stage investment. The UAE and Saudi Arabia are first and third in a world ranking of smartphone penetration, he explained, meaning they are a natural focus for technology firms.

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