The Aspen Institute has announced that the Soros Economic Development Fund, the Skoll Foundation, and the European Investment Bank have committed nearly $14.2 million to a new venture capital fund designed to transform the burgeoning technology sector in the Palestinian territories' West Bank into a vehicle for economic development, job creation, and regional stability.
The $50 million Middle East Venture Capital Fund will invest in entrepreneurial companies in the Internet, mobile, and software sectors that are emerging from the substantial community of software and telecom engineers and other entrepreneurs in Ramallah and throughout the West Bank. In support of the effort, the Soros Economic Development Fund committed $5 million to the fund, while the Skoll Foundation committed $2.5 million. These commitments are in addition to a �5 million (approximately $6.7 million) commitment made in December by the European Investment Bank.
The Middle East Venture Capital Fund will address the region's limited access to venture financing and international markets, which have been the key impediments to rapid growth of the Palestinian technology sector. Once it concludes its fundraising, the fund expects to build a portfolio of twelve to fifteen companies, which will work to expand job creation, exports, and outside investment, while encouraging the companies to allocate up to 1 percent of their equity or revenues to a nonprofit fund for education initiatives for underserved Palestinian youth.
"We do not typically invest in technology funds, but we believe the Middle East Venture Capital Fund can make a real contribution to stability and security in the region, tap into market demand, and employ skilled Palestinian workers that might otherwise work elsewhere," said Soros Economic Development Fund president Stewart Paperin. "We think this fund can be both a positive social force and be profitable. It is simple: This is a great idea, a great team, and great double bottom line."