The event was a show of muscle for the venture arm of Mubadala (pronounced Moo-BAH-da-la), which is trying to shed its reputation as merely a writer of checks for the funds of other investors, especially prominent Silicon Valley VC firms. For Mubadala’s next act, Ajami is seeking to milk his tech connections to put more money directly into startups. At the same time, Mubadala is increasingly using its clout to encourage Western companies and investors to deepen their ties to the UAE’s tech ecosystem, part of the country’s broader push to diversify its economy away from oil. Those energy resources—and the promise of lower costs for running power-hungry data centers—are also an important part of Mubadala’s pitch for bringing more founders to the region.

For Ajami, 49, the goal is for Mubadala—a term that means “exchange” in Arabic—to one day be mentioned in the same breath as Sand Hill Road’s most vaunted investment firms. “The way founders speak about Sequoia—why not, 20 years from now, won’t they speak that way about Mubadala?” asked Ajami.

Ajami has a ways to go before he gets Mubadala there. Mubadala has stumbled badly in Europe as it has tried to employ a strategy similar to the one it used to break into the U.S. The companies it has backed in Europe have performed so poorly that Mubadala has put Jonno Elliott—who joined the firm in 2022 after leading VC investments at Virgin Management Ltd.—in charge of salvaging its portfolio of companies from the region, according to a person who spoke to Elliott. Among some European investors and founders, it has developed a reputation for aggressive tactics that could impact its ability to invest in top European companies in the future.

A Mubadala spokesperson said Elliott has “stepped in to assist companies in overcoming challenges when his expertise was needed.”

And while plenty of tech investors speak highly of Mubadala, many of them are eager to curry favor with the deep-pocketed firm so it continues to invest in their funds, especially in the current dismal fundraising environment for VC firms. Privately, after singing the praises of Mubadala as a limited partner, many venture capitalists have also said its direct investments in startups don’t carry the weight of other investors’ bets. Sovereign wealth funds just don’t have the track record of picking winners that VC firms do, those critics say.

Still, Mubadala has had some notable successes. Ajami and his lieutenants have helped it buy shares in buzzy companies like SpaceX, Waymo, Klarna, Brex, Chime, pharmaceuticals company Recursion and AI infrastructure company Crusoe Energy Systems, among others. Mubadala Capital, the VC and private equity arm of the sovereign wealth fund, oversees a $24 billion pool of capital with 180 employees spread across several offices, including in London, New York and San Francisco, which hosts a tech team they first established in 2017. That team typically writes checks between $20 million and $50 million for companies in their Series B to D funding stages.

Mubadala is also continuing to plow money into other VC funds. Its portfolio includes Altimeter Capital Management, Greenoaks Capital, Iconiq Capital, Dragoneer Investment Group, 8VC, Marcelo Claure’s Bicycle Capital, DCVC, Haun Ventures, Arch Venture Partners, Clocktower Group, Radical Ventures and a handful of emerging managers, like a new $30 million seed fund called Nebular, according to several people familiar with these funds.

Some prominent tech investors say Mubadala has helped shake the stereotype of sovereign wealth funds as little more than the writers of blank checks for startups. “Mubadala emerged in the leadership pack in such a short period of time,” said Brad Gerstner, Altimeter’s founder. “They were unknown seven years ago, and there was a view generally held that all sovereign money was passive and nonstrategic.”

More recently, Mubadala has been employing a well-worn Silicon Valley playbook to invest directly in more startups: meeting hundreds of founders, often multiple times, to determine the best choice, Ajami says. Often, the introductions to those founders come from the network of venture capitalists Mubadala has backed.

Still, Mubadala has something traditional tech investors do not, the firm’s supporters argue. “Silicon Valley firms have a problem when it comes to global mindset,” said Melissa Guzy, co-founder of Singapore-based VC firm Arbor Ventures. “They are very narrow-minded. They think everything happens in the U.S. and that it happens in Silicon Valley. That’s not always true.”

Mubadala’s ties to oil companies across the Middle East, for instance, has been of use to Crusoe, which powers its AI data centers using waste gas from oil production. Meanwhile, the generative AI boom has helped propel Mubadala and other sovereign wealth funds into the limelight as much-sought-after investors, due to their plentiful cash reserves and the AI startups’ insatiable thirst for cash. Mubadala and Abu Dhabi AI firm G42 recently formed MGX, an AI investment fund expected to eventually manage $100 billion in assets. MGX has been in talks to invest in a new Sam Altman–led chip business, the Financial Times reported.

“Abu Dhabi is going from a place that was the last call to now the first call,” said Steve Drobny, founder of alternative asset manager Clocktower and a co-host of the recent desert shindig, adding that “Ibrahim is squarely in the Silicon Valley inner circle.”

“If you think about the three fundamental pillars of what’s happening in technologies like energy, infrastructure and intelligence—we are at the center of energy, and we have an opportunity to become the center of infrastructure and intelligence,” Ajami said. “This is a once-in-a-lifetime opportunity where we can really cement ourselves as leaders in this industry.”

‘Super Entrepreneurial’

Ajami’s interest in the tech business started in 1996, when he saw Marc Andreessen on the cover of Time magazine seated on a throne under the banner “The Golden Geeks.” Andreessen’s web browser company, Netscape, had gone public the year prior, making him an “instantaire,” Time wrote.

After graduating from Northeastern University in 1999, the Lebanese-born, Abu Dhabi–raised Ajami made a beeline to Silicon Valley. He spent two years working in tech, including for the now-defunct electronics company Packard Bell NEC, while devouring pages of the business magazine Fast Company. In 2004, after completing his master’s in business at the University of Southern California, he headed back home to Abu Dhabi.

Two years later, he joined Mubadala shortly after the UAE government formed it to generate returns from the country’s petro fortunes while reducing its reliance on oil by developing other parts of its economy. He worked in a variety of roles, including as a key figure in the formation of GlobalFoundries, a chip manufacturer Mubadala and semiconductor company Advanced Micro Devices formed in 2009.

A few years later, in 2017, Mubadala put Ajami in charge of opening an office in San Francisco to spearhead an effort to do more tech investing. He was eager to do it, despite the grueling flights he made from Abu Dhabi to San Francisco at least once a month. To manage the long travel days, he consumed a regimen of organic green tea, almonds, melatonin and magnesium citrate.

During their first year on the ground in San Francisco, he and a small team based there scouted for investments from unglamorous surroundings: a downtown WeWork office on Montgomery Street. Their conference rooms were so tightly packed that Ajami, Alaa Halawa, head of Mubadala’s healthcare investing, and Ayman AlAbdallah, another early partner, knocked knees when sitting in them. Their printer broke often, founders’ dogs crowded the office and startup employees sharing the space with Mubadala would strike an ear-piercing gong every time they made a sale.

“It was frankly super entrepreneurial,” said AlAbdallah. “It served us very well.”

As they tried to crack into the elite networks of tech and VC, the Mubadala crew embraced a scrappy mindset similar to that of the startup founders around them. Ajami once crashed an invite-only event in downtown Los Angeles in hopes of mingling with attendees, including venture capitalist Chamath Palihapitiya. After groveling to the host of the party, he was eventually allowed in.

“Every single one of us is just a very ambitious individual,” said Mubadala partner Shaun Lee.

As a prelude to gaining direct access to companies, Mubadala first got its foot in the door with VC firms; it has invested in about 30 of them since 2017. In 2022, Ajami met Sebastian Siemiatkowski, a co-founder and the CEO of Swedish fintech company Klarna, through Marc Stad, founder of Dragoneer Investment Group and an early Klarna investor (Mubadala had invested in a Dragoneer fund). Later, in July 2022, that connection led to Mubadala’s direct investment in Klarna after the startup dramatically reset its valuation from $45 billion to $6.7 billion amid a broad downturn in stocks. That allowed Mubadala to get a piece of the fintech at a more attractive price. It wrote a $150 million check as part of the $800 million round.

Similarly, another VC firm Mubadala had invested in, DCVC, introduced Halawa to Chris Gibson, a co-founder and the CEO of Recursion. The pharmaceutical company had struggled to attract established Sand Hill Road investors, just as Mubadala was trying to establish its credibility in tech. The two parties took a gamble on each other. In late 2017, Recursion raised money from Mubadala at a valuation of $268 million. In 2021, Recursion went public at a valuation of $5 billion.

“We were building something that was new enough and different enough that, frankly, we weren’t palatable to the best funds,” said Gibson, adding that investors were turned off by the company’s decision to headquarter in Salt Lake City rather than the San Francisco Bay Area. “We found investors that were less constrained by that dogma.”

Missteps

It hasn’t always been smooth for Mubadala as it has tried to build a name for itself in tech.

One of Ajami’s first deals in Silicon Valley was leading a $60 million investment in San Francisco–based logistics company Turvo in 2018. The next year, Ajami and other board members accused the CEO, Eric Gilmore, of spending over $75,000 in company funds at strip clubs, according to a lawsuit Gilmore filed against Turvo, in which he accused the Turvo board of not following proper procedure when they fired him in 2019. Even before the board made its discovery, Ajami said, he had developed misgivings about Gilmore.

“That was a mistake,” Ajami said. “There was something in my gut that just didn’t feel right.”

Gilmore didn’t respond to a request for comment.

In another early black eye, in 2017, Mubadala contributed $15 billion to Vision Fund, the gargantuan SoftBank fund that came to be associated with some of the biggest flameouts of the past decade, including WeWork and construction startup Katerra.

More recently, it’s been trying to sell off or turn around several lackluster European investments. Among them are electric scooter company Tier, which recently merged with another scooter company, Dott, in a deal that the Mubadala partner Elliott influenced, according to a person who spoke to Elliott. Another is Huboo, a fulfillment service for e-commerce companies, which Mubadala first backed in 2021 at a $420 million valuation, according to PitchBook. The company has since raised funds at a much lower valuation, according to a person familiar with the matter. Earlier this year, Huboo’s CEO stepped down.

In some cases, Mubadala has clashed with the leaders of its European startups, who have then left their companies. For example, it is trying to sell the core assets of Wefox, a European insurance company that Mubadala valued at $4.5 billion in 2022, to The Ardonagh Group at a price under $600 million, according to a person familiar with the matter. Wefox’s founders and some earlier investors are against the sale, the person said. Ardonagh is backed by another Abu Dhabi sovereign wealth fund, the Abu Dhabi Investment Authority. In March, Wefox co-founder and CEO Julian Teicke stepped down. Ajami is on Wefox’s board of directors.

“To frame our tactics as aggressive is a mischaracterization,” Ajami said in an emailed statement. “If aggressive means trying to make businesses stronger and more efficient by rolling up our sleeves, driving restructuring to improve profitability and long-term business success—then we have a different view on the term aggressive.”

The sovereign wealth fund has also butted heads with the management of the Turkish delivery company Getir over its direction, according to Bloomberg, which earlier reported on Mubadala’s efforts to revive Wefox. Getir investors are expected to vote soon on a new board; it’s possible Getir CEO Nazim Salur will be removed from his position soon after, per Bloomberg. Getir didn’t respond to a request for comment. Mubadala didn’t comment directly on its relationship with the company.

Even one of the VC funds Mubadala chose to back hasn’t gone as planned: Stride VC founder Fred Destin said late last year that his London-based firm had paused fundraising for its next fund.

Another challenge was the unease of some founders with raising money from Middle Eastern sovereign funds due to the region’s autocratic regimes, according to several investors. Those concerns reached a fever pitch in 2018 after the Saudi Arabian government’s 2018 killing of dissident journalist Jamal Khashoggi. Ajami said the Khashoggi affair didn’t cause any issues for Mubadala. “People knew that we were [representing] the UAE. I think it was quite distinctly different,” he said.

Founders that have raised money from Mubadala agree. “People sometimes broadly paint the Middle East with a single brush,” said Crusoe co-founder and CEO Chase Lochmiller.

A bigger issue for Mubadala, Ajami said, has been combatting the notion that it’s a passive purveyor of funding. Mubadala has worked hard to alter the “perspective about sovereign wealth funds that we’re just slow and bureaucratic,” Ajami said. They’ve also reiterated to founders their preference for investing earlier rather than writing giant checks just before an exit.

“It’s an uphill battle to educate the market,” said Mubadala’s Lee.

Homegrown

Mubadala has moved up, in more ways than one, from its days of sharing a WeWork space. Today, it operates out of an office on the 55th floor of the Salesforce Tower with floor-to-ceiling windows and sweeping views of San Francisco.

Although Ajami frequently visits the San Francisco office, he spends most of his time in London and Abu Dhabi. While most sovereign wealth fund investors tend to keep a low public profile, Ajami has become a power user of X, the service previously known as Twitter, where he frequently posts his thoughts on everything from his appearance at an event hosted by Calcanis to lines of poetry from Rumi, the 13th-century Sufi mystic. “Being in the Bay Area just means I need to level up—every single time,” he wrote in one X post in early June.

Mubadala’s partners also say it’s easier for them to gain access to the best deals now that many in tech have heard of the firm (even though many continue to mispronounce its name). It hasn’t hurt that diplomatic ties between the U.S. and the UAE have grown tighter over the years, say investors. As tensions with China intensify, concerns among U.S. political and business leaders over the human rights records of Gulf countries have taken a back seat, they say.

“There is an accelerating view that the GCC—the gulf countries, inclusive of the UAE and Saudi—are on the side of modernity,” said Altimeter’s Gerstner, who pointed to those governments’ recent support of Israel as a factor that may have increased the willingness of U.S. investors to accept capital from the region.

One other factor: Raising money from pension funds, university endowments and other limited partners in the U.S. has gotten far more challenging for VCs over the past two years, leading many of them to cut the size of their funds.

Even some tech investors who have long avoided raising money from the Middle East based on their concerns about the region’s autocratic regimes are changing their tune. In the case of Lux Capital’s Wolfe, he said his March trip to the Mubadala event in the UAE changed his perspective, and he would now welcome Middle Eastern investors as limited partners. “When you have this mix of talent, tech, capital and trust, the most important currency, you have the recipe to become a major tech mecca,” Wolfe said.

A spokesperson for Lux said the firm hadn’t raised money from “sovereign wealth funds in the past because we’ve always had oversubscribed funds from U.S. institutional LPs,” adding that if it were to raise money from sovereign funds, that would depend on whether they are a “strategic ally and have good diplomatic standing with the U.S.”

Some U.S. investors say they prefer working with Mubadala over its biggest competitor in the Middle East—Saudi Arabia’s $900 billion sovereign wealth fund, the Public Investment Fund—because Mubadala doesn’t put as much pressure on venture capitalists and founders to invest in the UAE. The Information has previously reported that PIF has asked founders and investors to establish a presence in Riyadh or to invest in companies based there in exchange for funding. A PIF spokesperson didn’t respond to a request for comment.

Instead, Mubadala has taken more of a carrot approach, rather than brandishing a stick, to attract outsiders to investment in Abu Dhabi. In late May, Ajami arranged a spontaneous dinner in Abu Dhabi’s Al Maryah Island at Cafe Milano, a restaurant inside the Four Seasons Hotel, to help sell a cryptocurrency founder on domiciling their business there. Al Maryah Island is home to Abu Dhabi Global Market, a financial free zone established in 2015 to attract foreign investment.

The artificial island has aspirations of becoming a mini Silicon Valley. It’s home to Hub71, a Mubadala-backed startup accelerator Ajami helped create; the Rosewood Abu Dhabi, a sibling hotel to the Sand Hill Road location where venture capitalists frequently cut deals; and a branch of Barry’s Bootcamp, the fitness franchise favored by San Francisco techies. A range of tech celebrities has been sighted there recently, including WeWork co-founder Adam Neumann and Coinbase co-founder Brian Armstrong.

At the May dinner, crypto investor Katie Haun, founder of Haun Ventures and a former Andreessen Horowitz general partner, discussed the benefits of starting a crypto company in Abu Dhabi with representatives of the UAE government, local founders and investors. “In the face of the regulatory uncertainty, some founders even in the U.S. are looking for other global hubs,” explained Haun. “One of the things that I think a lot of folks don’t realize is that the UAE is a rather young country.…It’s very digitally forward.”

Now that getting American techies to venture onto Abu Dhabi soil poses less of a challenge, a priority for Mubadala is proving its competitiveness with the top VC firms.

“From a look and feel, it was very important not to just be perceived as channeling sovereign money,” said Mubadala’s Halawa. “We can stand on our own two feet and deliver what other firms can deliver in Silicon Valley.”