Abu Dhabi’s sovereign wealth fund Mubadala is set to create a start-up ecosystem in Abu Dhabi that will attract New Space and other emerging technology companies to the Gulf Arab state. The ecosystem will be called Hub71 and will include Softbank’s Vision Fund and Microsoft as partners, according to Khaldoon Khalifa Al Mubarak – Mubadala’s Chief Executive Officer – in an interview with Nikkei Asian Review.
Hub71 is being funded by Mubadala to the tune of one billion Dirhams (U.S.$272 million) that will be used for subsidizing or to co-invest in promising startups involved in New Space, artificial intelligence, biotechnology, and microelectronics. Hub71 will be based in the financial district of Abu Dhabi, the capital city of the United Arab Emirates, and is part of the UAE’s overall strategy of diversifying its economy away from its dependency on hydrocarbons.
Mubadala manages assets worth over U.S.$250 billion in the United States, Europe, and more recently, in the Asia-Pacific region. Mubadala’s investments in Asia – totaling U.S.$15 billion to date – have been primarily made via Softbank’s Vision Fund.
“We definitely have the appetite to considerably increase our capacity in this region,” said Khaldoon Khalifa Al Mubarak, speaking with the Nikkei Asian Review.
“The experience in Asia has opened up our eyes. We have found very interesting companies, very interesting opportunities and very exciting growth trajectories,” Al Mubarak added.
These investments in Asian unicorns, however, are forcing Mubadala to create “a more balanced portfolio,” that includes satellite manufacturing and applications startups, as well as companies involved in agriculture and infrastructure.
The reason for this are the increasing valuations in Asian unicorns backed by the Vision Fund that makes the search for other promising startups much more challenging. By creating Hub71, Mubadala – in partnership with the Vision Fund and Microsoft – hopes to attract promising startups to Abu Dhabi, as well as identify commercial opportunities nearer to home.
“I believe data is the new oil. Companies building on data are very successful now and will be more successful in the future, Al Mubarak told Nikkei Asian Review, adding that Abu Dhabi’s Hub71 will be a gateway to the wider Middle East for startups establishing themselves in the market, and that Mubadala is committed to helping such companies expand in the region.
Mubadala owns significant shares in Sir Richard Branson’s Virgin Galactic.
News of the creation of Hub71 by Mubadala and its partners follows the announcement of the UAE Space Agency’s space investment strategy that seeks to increase investments in the country’s commercial space sector.