Contact: Michael Bergman
The Aspen Institute
The Soros Economic Development Fund, Skoll Foundation, and European Investment Bank commit to multi-million dollar anchor investments in the Middle East Venture Capital Fund
New York, NY, March 24, 2010 –– At a gathering hosted by the U.S.-Palestinian Partnership at the Harvard Club of New York last week, key leaders from New York’s investment community assembled to learn about a new venture capital fund seeking to transform the Palestinian West Bank’s burgeoning technology sector into a spark plug for economic development, job creation and regional stability.
The Soros Economic Development Fund, Skoll Foundation, European Investment Bank and others have collectively announced significant anchor commitments to the planned $50 million fund, which will invest in entrepreneurial companies in the Internet, mobile and software sectors that are growing out of the substantial community of software and telecom engineers and other entrepreneurs in Ramallah and throughout the West Bank.
“While the private sector can’t do much to address diplomacy or security, it can play an equally important role through the contribution of resources and investment to the West Bank,” said Jean Case, co-chair of the U.S.-Palestinian Partnership and CEO of the Case Foundation. “It has been a complete delight to see the undaunted courage of private sector leaders who’ve stepped up in the midst of troubles and strife, knowing that they can make real money here while also increasing potential for prosperity and stability in the region.”
In a letter read at the gathering, Palestinian Prime Minister Salam Fayyad said of the Middle East Venture Capital Fund: “We believe this effort – and others like it – can expand local job opportunities, contribute to the growth and development of the private sector, and help attract more business-oriented foreign investments to Palestine.”
During the New York gathering, the Soros Economic Development Fund, a U.S. private foundation that works to alleviate poverty and community deterioration, announced a $5 million investment in the fund. “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. 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,” said Stewart Paperin, President of the Soros Economic Development Fund.
The Skoll Foundation announced a $2.5 million commitment to the fund. “This is the right investment and the right time,” said Edward Diener, Counsel of the Skoll Foundation.
These new commitments are in addition to the €5 million commitment made by the European Investment Bank made in December.
Yoav Samet, Director of Corporate Development at Cisco, also spoke at the event regarding Cisco’s significant business and corporate social responsibility investments in the region. “We had great business success outsourcing to companies in the WB. This is a testament to Palestinian high tech sector potential,”said Samet. Also in attendance was Gareth Bayley, Chief of Staff to Tony Blair in the Office of the Quartet Representative, who shared greetings from the former British Prime Minister and his support and appreciation for this effort.
Not subject to the obstacles of movement and access, which presents significant challenges for other sectors in the Palestinian Territories, ICT and software exports have represented the only economic activity to see near continuous growth over the last decade. The Palestinian West Bank has an educated and entrepreneurial population and a developed IT infrastructure, which includes 3600 skilled ICT engineers and 13 higher learning institutions, which are projected to add several thousand engineers over the next 3 years.
The new fund – which will be managed by Saed Nashef and Yadin Kaufmann - plans to address the limited access to venture financing and to international markets, which have been the key impediments to rapid growth of the Palestinian technology sector.
Once it concludes its fund-raising, the fund expects to build a portfolio of 12-15 companies. The investments are likely to lead to an increase in job creation, exports, and outside investment. Moreover, the fund will encourage portfolio companies to allocate up to one percent of their equity or revenues to a not-for-profit fund for education initiatives for underserved Palestinian youth.
About the U.S.-Palestinian Partnership
Launched in 2007 by the President of the United States, the Secretary of State, and U.S. business leaders, the U.S.-Palestinian Partnership (UPP) focuses on creating economic opportunity for the Palestinian people and helping prepare Palestinian youth for the responsibilities of citizenship and good governance. UPP was launched to facilitate progress toward a two-state solution, wherein Israel and Palestine can live side by side, in peace, security and prosperity. By demonstrating a willingness to work with responsible Palestinian leaders and institutions, this partnership aims to increase support for a Palestinian leadership committed to peace and willing to negotiate the political compromises required to reach this important goal.
To date, UPP has encouraged economic investment and educational opportunities through support of the Palestine Investment Conference , Palestinian Business and Investment Forum, expanding Youth Development and Resource Centers in the West Bank and cultivating multi-million dollar business, social and in-kind commitments from USAID, Cisco, Intel, Microsoft, Google and others.
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