Partial Guarantee Investment Program
The Partial Guarantee Investment program is designed to limit the downside risk of investments and encourage investors to provide capital to high-risk startups, which contributes to expanding the scope of venture capital investments in Qatar. The program provides a set of additional tools that serve SMEs, enhancing their growth and sustainability. Under the program, QDB serves an independent guarantor, providing a partial guarantee to individual investors or investment clubs and funds that invest in permissible business activities, to remedy a loss of the principal invested amount.
Partial Guarantee Investment Program
Main Features
Benefits
• Provide protection to investors against potential losses up to a certain limit.
• Encourage diversification of the investment portfolio through venture capital investments in startups.
• Support financing small and medium-sized companies operating in priority sectors.Beneficiaries
The program targets technological SMEs based in Qatar, that are characterized by high growth and operate in sectors prioritized by Qatar Development Bank.
Eligibility Criteria
- Company criteria:
• The company must be based in Qatar or have a headquarters in Qatar and is operating in the country.
• The company should not be included in the current investment portfolio of Qatar Development Bank.
Investor criteria:
• Accredited individual investors, accredited investor groups, and investment clubs registered in Qatar.
• The investor or group member should not be associated with the management, ownership, or establishment of the investee company.
• There is no conflict of interest with the investee company. - Qualified management team: To have a qualified management team which possesses both management and technical knowledge, with a good level of commitment.
Application process
- Those interested in the program must submit the necessary documents and proof of funds transfer before a letter of guarantee is issued by Qatar Development Bank. Required documents include:
For the company (through the investor):
• Company investment presentation.
• The company’s comprehensive business plan.
• Financial statements or administrative accounts (if applicable).
• Incorporation details and supporting documents.
• Background on the company’s founders.
• A copy of the investment agreement signed between the investor and the company.
• A copy of the investment terms and conditions (if applicable).
For the investor:
• Due diligence documents related to the proposed deals.
• Documents proving the investor meets the primary and secondary criteria such as investment experience, professional background, previous affiliations and exit records.
• Proof of passing Qatar Development Bank’s Venture Capital Training Program (if applicable).
• Proof of passing the Qatar Development Bank’s Angel Investment Certification Program (if applicable).
• Proof of transferring funds by the investor before issuing the letter of guarantee.
• Filling out the guarantee form between the investor and Qatar Development Bank, which includes the investor’s pledge to pay the agreed percentage of the profits achieved upon exit and to waive all his rights in the company in favor of Qatar Development Bank upon claiming the guarantee
Fees and security guarantees
- • An annual administrative fee of 1% of the guaranteed amount is imposed.
• The investor is required to provide post-dated cheques to cover the administrative fees.
• Client undertaking to pay 20% of the profits achieved upon exit to the product account at Qatar Development Bank
Notes
- 1. Qatar Development Bank prioritizes the technology sector and high value-added sectors.
2. Download (Annex 1: Investor Accreditation Stages and Criteria) for more information.
Frequent Asked Questions
FAQs
What is the Partial Guarantee Investment Program by Qatar Development Bank?
The Partial Guarantee Investment Program is an initiative that aims to reduce investment risks for individual investors and investment clubs by providing a partial guarantee that compensates for the loss of the principal invested amount, which encourages investments in high-risk small and medium-sized startups.
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Who are the target groups that benefit from this program?
The program is intended for accredited individual investors, accredited investor groups, and investment clubs registered in Qatar, who wish to invest in small and medium-sized companies operating in technological sectors that comply with Islamic Sharia.
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What sectors does the program prioritize?
Priority is given to companies operating in the technology sector and high value-added sectors.
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What are the eligibility criteria for companies?
- The company must be based in Qatar or have a headquarters in Qatar and is operating in the country.
- It must not benefit from a current investment from Qatar Development Bank.
- It must not benefit from a current investment from Qatar Development Bank.
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What are the eligibility criteria for investors?
- The investor must be an accredited individual or part of an accredited investor group or an investment club registered in Qatar.
- The investor or group member must not be associated with the management, ownership, or establishment of the investee company.
- No conflict of interest with the investee company.
- The investor or group member must not be associated with the management, ownership, or establishment of the investee company.
- No conflict of interest with the investee company.
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What are the required documents?
For the company (through the investor):
• Company investment presentation
• The company’s comprehensive business plan.
• Financial statements and administrative accounts (if applicable).
• Incorporation details and supporting documents.
• Background of the company’s founders.
• A copy of the investment agreement signed between the investor and the company.
• A copy of the investment terms (if applicable).
For the investor:
• Due diligence documents related to the proposed deals.
• Documents proving the investor meets the primary and secondary criteria such as investment experience, professional background, previous affiliations and exit records.
• Proof of passing the Qatar Development Bank’s Angel Investors Certification Program (if any).
• Proof of transferring funds by the investor before issuing the letter of guarantee.
• Filling out the third-party guarantee form between the investor and Qatar Development Bank, which includes the investor’s pledge to pay the agreed percentage of the profits achieved upon exit and to waive all his rights in the company in favor of Qatar Development Bank when claiming the guarantee.
• Proof of passing Qatar Development Bank’s Venture Capital Training Program (if applicable).
• Company investment presentation
• The company’s comprehensive business plan.
• Financial statements and administrative accounts (if applicable).
• Incorporation details and supporting documents.
• Background of the company’s founders.
• A copy of the investment agreement signed between the investor and the company.
• A copy of the investment terms (if applicable).
For the investor:
• Due diligence documents related to the proposed deals.
• Documents proving the investor meets the primary and secondary criteria such as investment experience, professional background, previous affiliations and exit records.
• Proof of passing the Qatar Development Bank’s Angel Investors Certification Program (if any).
• Proof of transferring funds by the investor before issuing the letter of guarantee.
• Filling out the third-party guarantee form between the investor and Qatar Development Bank, which includes the investor’s pledge to pay the agreed percentage of the profits achieved upon exit and to waive all his rights in the company in favor of Qatar Development Bank when claiming the guarantee.
• Proof of passing Qatar Development Bank’s Venture Capital Training Program (if applicable).
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What are the fees associated with the program?
An annual administrative fee of 1% of the guaranteed amount is paid by the investor to Qatar Development Bank.
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What is the maximum guarantee value?
The maximum guarantee coverage is QAR 1.825 million (USD 500,000) per investment round, with a maximum of 50% of the investment value, or 33% of the total investment round whichever is lower.
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What is the validity period of the guarantee?
The guarantee is valid for up to 3 years or as decided by the Investment Committee for each case individually.
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