Digital wealth manager FinaMaze rolls out VC investment fund

Investors can gain exposure to Mena start-ups from $10,000

Retail investors in the UAE can now invest in venture capital funds through hybrid wealth manager FinaMaze. Getty

FinaMaze, a hybrid asset manager regulated by the Abu Dhabi Global Market, rolled out a new investment portfolio that will give investors with a net worth of more than $500,000 exposure to venture capital funds in the Middle East and North Africa region.

The FinaMaze Top VC Booster portfolio will open the “world of VC investments” to individual qualified investors from $10,000, the company said.

“VCs and private equity funds have always been a highly desired asset class that was confined to the institutional and accredited investors committing considerable amounts,” said Mehdi Fichtali, founder and chief executive of FinaMaze, which offers investment advice through a combination of human experience and machine learning outcomes.

“These non-publicly traded private equity funds invest capital in companies or projects with a long-term view with often decent returns but are virtually unavailable to the five-digit investors.”

Mena start-ups raised $1.2 billion in the first half of 2021, up 64 per cent over the same period a year ago, according to data platform Magnitt.

However, the number of deals dropped by 20 per cent to 254 as angel investors diverted funds towards more traditional asset classes such as stock markets and property.

The UAE led in terms of deal numbers, securing 61 per cent of all investment. Major funding rounds in the first half included $415 million for Dubai’s cloud kitchen company Kitopi, $30.5m for Saudi Arabia’s e-commerce platform Sary and $30m for Egyptian freight start-up Trella.

The top three Mena centres – the UAE, Egypt and Saudi Arabia – accounted for 71 per cent of total capital invested during the period, the Magnitt data showed.

The first of the VC Mena investment portfolios will be dedicated to a top VC leader in the region “with a proven track record as an early investor in a number of Mena unicorns”, Mr Fichtali said.

Last month, FinaMaze started offering prime retail investors access to its algorithm-powered portfolios across a range of asset classes. It defines prime retail investors as those who invest a minimum of $2,000. Previously, only professional investors had access to the wealth manager’s investment products.

Robo-advisers have become popular in the wealth management sector because algorithms can crunch large and intricate data sets across different parameters faster, more precisely and at greater volumes than most people.

In addition, they reach a historically underserved market of middle-class investors unable to obtain access to portfolio management services due to minimum investment requirements.

FinaMaze was launched during the FinTech Abu Dhabi 2020 forum in November 2020 and is regulated by the ADGM’s Financial Services Regulatory Authority.