Investing in the future

What does it take to build a movement for impact investing in a region where the concept is still emerging? In this special live recording of the Shaping Philanthropy podcast, Nafez Dakkak, Managing Partner of Anara Impact Capital, shares the story behind launching a groundbreaking US$50 million fund to support startups across MENA focused on learning, climate, and well-being.

Anchored by Alfanar Venture Philanthropy, Anara is the first regionally-backed impact investment fund of its kind.

The episode opens with a personal reflection on growing up in occupied Palestine and Dakkak’s decision to pivot from neuroscience to economics at Yale.

“I realised that if I became a neurosurgeon, I'd be saving one person at a time, but if I could do something at a societal level, it would be a lot more important," he said.

Speaking to an audience of practitioners, advisors, entrepreneurs, foundation staff, and humanitarians at the Sharjah Research Technology and Innovation Park (SRTI), Dakkak outlined Anara’s investment strategy and the importance of working closely with founders to help them scale regionally and beyond.

“The best way to predict the future is to create it,” he said. “I think Venture Capital is great, but I just think we need to be a lot more intentional about the sectors that will underpin the quality of life in our region, and that is why for me, taking an impact driven approach focusing on these three sectors – learning, climate and well-being - makes a lot of sense.”

While acknowledging the growth of the region’s venture capital scene, he highlighted that only 5% of funding currently goes to learning, climate, and well-being—compared to 20% globally.

Drawing on his experience at the Queen Rania Foundation in Jordan, where he led the creation of renowned learning platform Edraak, Dakkak spoke passionately about the importance of raising literary standards (not just statistics).

He lamented the development world’s focus on “sexy” solutions, like AI and tech for classrooms and citing a World Bank report, noted that six out of 10 children in the Arab world cannot read for comprehension.

“I think it's probably the most important problem the region faces today, because we learn to read, but then we read to learn, and if our kids can't read to learn, then what?” he said.

Anara will be the first regionally-backed investment fund supporting MENA start-ups. Funders include Dara Holdings, the family office of Saudi businesswoman Lubna Olayan, and several other family officers. A European development bank will provide first loss funding.

Dakkak said it had been challenging getting regional funders to back Anara, due to a lack of familiarity with impact investment fund models and the “cultural barriers” around talking publicly about impact.

But he said he hoped people would feel more comfortable to come forward once the fund reached its first close. “We're trying to create a movement and start something new - and that doesn't happen unless we can share these stories,” he explained.

He also addressed the recent withdrawal of USAID funding, describing it as painful in the short term but potentially beneficial in the long run. “I hope it’s going to create more sustainable and locally-based solutions that are culturally attuned.”

To conclude, Dakkak emphasised that impact investing is not a panacea. “There will always be a need for philanthropy. I'm not asking an entrepreneur to come and figure out the capitalist market-based solution to famine in Sudan—that needs direct humanitarian aid.”