Axie Infinity investor Animoca plans to fund UAE start-ups as it debuts in Middle East

Venture capital and software company Animoca Brands is planning to set up funds for UAE start-ups as it makes its debut in the Middle East, its newly-appointed regional head has said.

The Hong Kong-based Web3-oriented firm, which reportedly has a value of about $6 billion, will open its first regional office in Dubai, with plans to bridge the gaps in financing, market access and mentorship that start-ups are facing, said Omar Elassar, managing director for the Middle East and head of global strategic partnerships at Animoca Brands.

Web3 is the third stage of the World Wide Web's evolution that uses the capabilities of artificial intelligence, machine learning and blockchain to make the internet smarter.

“There is definitely a high concentration of capital and investors [in the UAE], liquidity providers who are sitting on the sidelines that maybe have been burnt in the past and are waiting for an institutional grade platform to come in. So, that's where we really do see an opportunity; we will be looking to launch a liquid fund and a venture-style investing fund,” Mr Elassar told The National.

The size of the funds have yet to be determined, he added.

“In terms of founder enablement, we're going to be supporting some of the start-ups and the more established crypto companies [in the UAE] through investment, through ecosystem advisory and through infrastructure,” Mr Elassar said.

The strategy would branch out into strategic and commercial expansion, with Animoca planning to work “with some of the corporates the government and regulators to drive high impact, real world use cases”, he said.

Animoca, which is also a gaming company, has four major business lines aimed at start-ups – advisory, incubation, investments and institutional applications. It has investments in more than 540 companies, including in Sky Mavis, the developer of the popular blockchain game Axie Infinity.

It also has a regulated stablecoin project in partnership with Standard Chartered and Hong Kong Telecom.

Animoca's bookings – a measure of total sales and income generating activity – from Web3 operating businesses of subsidiaries and projects incubated by the company hit $110 million in 2024, the company reported in March.

While that is down from the $182 million it posted in 2023, overall bookings for last year grew more than 12 per cent annually to $314 million, anchored by its digital asset advisory business that surged 114 per cent year-on-year to $165 million, it said. Investment activity, meanwhile, jumped more than 85 per cent to $39 million.

While Animoca's Dubai office will officially mark its entry into the Middle East, this will not be the first time it will have a footprint in the region: in October 2023, it partnered with Saudi Arabia's Neom Company for a $50 million investment to support Web3 programmes.

The Emirates and the kingdom will be, for now, Animoca's focus, and any expansion into other countries in the region will be explored, according to Mr Elassar.

“The Middle East is a big place and there are definitely other interesting markets … there's a lot of work to do [in the UAE and Saudi Arabia] for the time being – but I wouldn't take anything off the table,” he said.

The UAE has continuously extended its support to start-ups, which are playing a key role, working to pitch and develop new ideas using the latest innovations to solve real-world problems.

Start-ups in the Emirates raised about $619 million in 2024, second in Mena behind only Saudi Arabia's $750 million and part of an overall $1.9 billion in the region, according to Dubai-based data platform Magnitt.

“The UAE is a springboard for global business, and this market is very well positioned to influence how the Web3 industry really shapes up,” Mr Elassar said.