ABU DHABI // A centre launched by Masdar Institute of Science and Technology yesterday aims to encourage young entrepreneurs to start businesses focused on renewable energy.
The Centre for Innovation Systems and Entrepreneurship will provide investment for student and faculty projects at the institute, and hopes to announce its first investment by the end of the year.
Dr Fred Moavenzadeh, president of the institute, said creating small-scale enterprises "that come out of the innovation and imagination of young people" could help Abu Dhabi to diversify and grow in a sustainable manner.
"Masdar Institute is primarily concerned to provide the type of manpower that is necessary for the diversification of the economy, and one of the major elements of that diversification is to put an emphasis on entrepreneurship," Dr Moavenzadeh said.
While the UAE has a culture of entrepreneurship, he said few new businesses focused on renewable technologies.
"What we are looking for is to direct our innovative ideas towards the clean technologies; towards technologies that will have not only economic impact but also social impact," Dr Moavenzadeh said.
In the US, venture capital is a major source of funding for innovative ideas, said the centre's director Dr Bruce Ferguson, speaking on the sidelines of an entrepreneurship forum in the capital.
"Something like venture capital needs to be available here," Dr Ferguson said.
"I doubt it will look exactly like the western model but something like that source of funding for late-stage research and development, or early-stage commercialisation needs to be put in place.
"Today, investments in the UAE do not require much risk. One can make money investing in the infrastructure and all the various bits and pieces needed to make a wonderful country.
"The challenge is to shift some of that capital towards riskier, longer-term investments."
But even in the West, renewable energy and other sustainable technologies face funding challenges, as projects take years to develop and yield a profit for investors.
"I think we can do a better job here than the West does with these technologies," said Dr Ferguson.