The Arab Angel Fund founder gets Middle East investors involved with U.S. startups.
He’s a venture capital fund founder with Middle East expertise who was raised in rural Fauquier County, Va. After grad school at Georgetown, Kyle Hendrick worked for Fransmart in Alexandria, launching Five Guys and Elevation Burger in the United Arab Emirates, where his work caught the attention of UAE Ambassador Yousef Al-Otaiba. Hendrick, 28, became one of the first American hires at the Embassy and while there, came up with the idea for a venture capital firm to connect overseas investors with U.S. technology startups. In September, his Arab Angel Fund closed on its first $10 million.
How is yours different from other venture capital funds?
Our investors are 100 percent individuals and family offices, so we don’t have any institutional administrators. What we’re doing is pooling together our investors to give them access to U.S. technology startups that they didn’t have access to before, whether it be geography or that they’re not connected to the networks of Silicon Valley, D.C. or New York startups. It’s a new approach. My position at the embassy gave me the ability to identify that gap.
Of your 20 investments so far, is there one that you’re most proud of?
The Tamara Mellon brand is one.
She was the co-founder of Jimmy Choo and now she’s doing a direct to consumer e-commerce model for women’s shoes. She’s trying to disrupt the women’s shoe market by releasing lines that you can buy immediately, right after you see them on the runway at New York Fashion Week, with prices kept down because you’re not going the traditional retail sales route.
Was traveling to the Middle East different from what you expected?
I really enjoy the Middle East and think it gets a bad rap in the media here. The bottom line is that you hear about Syria and ISIS every day in the news, but you don’t hear about Dubai having the most state-of-the-art solar panels and Abu Dhabi having the biggest solar field in the world. You don’t hear about innovations that are happening and how they’re sponsoring startups.
For us, if we can get media buzz about individuals from the Middle East who want to invest in companies and help them grow and succeed, that’s a much different narrative for people who may otherwise have connotations associated with negative things. The United Arab Emirates is very modern but the people are what make the culture. They’re very hospitable.They’ve invited me to their homes for Ramadan where I might be the only person there not in national dress, but I’m treated just like any of them.
What about the tech scene in Washington? Is it changing?
There’s always been a big tech presence here, going back to the AOL days. Silicon Valley is about scaling and building customers and building products that people and enterprises will like. D.C. is more about getting government as a customer. If you can get a contract with the health agencies (or any agency really), that’s a huge and nice- paying client. Having government as a customer can make or break a startup and there’s obviously a lot of upside to that, but there are higher barriers to access. D.C. is going to be a nice intersection for what’s happening in tech as it becomes more entrepreneurial in nature.You’re going to have people that were with different government agencies and have identified problems saying, “we can create a business to solve this problem.”
This interview appears in the November 2016 issue of Washington Life.