During Abu Dhabi Finance Week, Hub71, Abu Dhabi’s global tech ecosystem unveiled its Angel Investor Support Package. Designed to foster the growth of angel networks and enable angel investors to form legal investment structures within Abu Dhabi’s thriving startup ecosystem. The package includes a financial incentive of AED 150,000. We sat down with Mohamed Al-Binali, value creation lead, Hub71 to learn more about the package.
Recognising the vital role angel investors play in fueling the growth of early-stage startups, Hub71 has established a comprehensive framework designed to simplify and enhance opportunities for angel investors to develop their networks and establish investment companies in Abu Dhabi. Hub71 will also equip angel investors with a fully digital infrastructure for voting on startup projects and deploying capital, enabling them to easily manage their portfolios and track investments.
By strengthening angel networks and simplifying the investment process, Hub71 aims to facilitate more early-stage ticket investments, thereby accelerating the growth and scalability of startups within the Abu Dhabi ecosystem.
Mohammed Al Binali, value creation lead at Hub71
Mohammed Al Binali, value creation lead at Hub71 said: “Angel investors play a pivotal role in bridging the funding gap for startups, and at Hub71, we are deeply committed to cultivating a robust investment environment that reinforces Abu Dhabi’s position as a global hub for innovation and entrepreneurial growth. By empowering the development of angel networks, facilitating larger ticket investments, and encouraging investment in early-stage startups, we aim to unlock the full potential of Abu Dhabi’s global tech ecosystem.”
Commenting on ADFW, Al Binali added: “Abu Dhabi Finance Week is very special for Hub71. We manage the venture Park, and this year was amazing. There was a great turn out and I think ADGM has created a work, play live atmosphere – we went from event to event and I didn’t need to jump into a car.”
To learn more about the programme, Mark Walker, editorial director, The Fintech Times sat down Al Binali in an exclusive interview:
What does value creation mean?
Hub71’s mission is to build an ecosystem that attracts startups and brings in partners to enable their growth. This involves bringing in corporates to work with startups, or VC investors or angel networks to engage with startups, regulators and academics.
We’re looking to bring value to incubated startups and bring in the right partners who can really elevate our ecosystem and community.
Have you always worked in the investment sector?
I’ve always been supporting the entrepreneurship ecosystem. Prior to my role at Hub71 I used to be at an entity called Khalifa Fund, which is a government agency that looks at developing the local entrepreneurship ecosystem, focusing more on the SME side.
Five years ago, when the Hub71 platform was launched, I jumped ship to see how we could support the tech ecosystem.
I’m lucky to be surrounded by these types of bright minds and entrepreneurs. They always look to solve problems and its inspiring to be around them on a day-to-day basis.
Are regulations, business advice and angel investment the three key pillars to supporting startups?
Hub71’s mission is to accelerate the ecosystem, which is still very young. The capital’s ecosystem is only 10 years old, meaning the earliest VCs are still only around a decade old too.
Part of what we do is identify the gaps in the ecosystem and figure out how we can fill them. We have launched programmes and offerings to accelerate the ecosystem, and the latest one is our angel support package. It incentivises investors to form syndicates under ADGM, and leverage the Hub71 platform to grow their values.
What is your definition of an angel investor?
Following family and friends, angel investors are usually the first tickets that come into your business. For the most part, ecosystems have been developed because they have a strong angel presence. They’re the ones who take an ecosystem from ideation to, hopefully, a post-profit product.
We have some angel investors that are looking at getting involved with startups but they are currently doing it on a case-by-case basis – investing individually. Where we come in – we look to see how can we group them up and create angel networks.
There are two major benefits from this. Firstly, by doing this you’re pooling capital together so you have bigger tech tickets for the startups. But beyond this, you’re also bringing in market opportunities.
These angel networks are usually C-suites and high-network individuals who have some sort of network that can support startups beyond capital.
The UAE has a very diverse ecosystem, with over 200 nationalities working within it. A lot of them are working in multinational entities too. They know how to invest, how to deploy it and where to do it – Hub71 is one of those platforms that showcases these opportunities.
What is the best amount for syndicating money together?
Any amount works. Angel investors usually give very small tickets, but if we group three, four or five angels together, that quickly becomes a $50,000 or even $100,000 ticket.
It’s better for a startup to have one grouped-up SPV instead of five indiviudal investors providing capital. This makes it much easier and cleaner for startups to work with their funding.
Interestingly, when we launched our angel support package, the idea was that you could either join an angel network or create your own version if you’re already investing in startups.
For those who want to learn about investing in startups, it’s a good idea to join an existing angel network. That way you can see how other people are deploying their investment strategies, and in turn see how value is created.
As of today, we have four angel networks. Some are C-suites in Abu Dhabi entities that want to invest in early-stage startups, whereas some are family offices that are looking at deploying in startups.
What else do angels and investors get out of the programme?
We provide Angel Networks that are going to be formed through Hub71 150,000 dirhams for two years. This funding helps support them to set up the network and SPV, as well as supporting them as they deploy into Hub71 startups, with legal costs and terms sheets.
The biggest value, however, is the value creation we create as they get a foot in with startups that have the potential to scale up.
What is your aspiration for this programme?
I don’t think it’s a numbers game. Rather, we just want to focus on filling the gap. We’re starting to see more specialised angel networks. For example, doctors are coming together to create health angel networks that fuel the health sector. We’re seeing the same thing in the climate tech and fintech sectors too.
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