The AI-Powered Investment Fund: How Mubadala and MGX Are Building the Future of Finance

“Artificial Intelligence is not just changing the game in finance — it’s rewriting the rules entirely.”

The future of investment is being shaped not by spreadsheets or boardrooms, but by algorithms, data pipelines, and AI-native strategies. At the forefront of this revolution stand two bold institutions: Mubadala and MGX. Their collaborative vision, detailed in the whitepaper "Alpha Intelligence: The Investment Fund of the Future", reveals how next-gen AI technologies are set to redefine everything from deal sourcing to value creation.

Welcome to the age of the AI-native investment fund.

Why AI Is a Game-Changer for Investment

Artificial intelligence, particularly in its generative and agentic forms, is accelerating faster than any technology in human history. The whitepaper highlights that while the internet took seven years to reach 100 million users, ChatGPT reached that milestone in just two months.

As AI systems grow smarter — progressing rapidly toward Artificial General Intelligence (AGI) — their ability to impact finance becomes more profound. Today’s applications focus on productivity enhancements, but tomorrow’s will involve complete automation of due diligence, real-time portfolio monitoring, and AI-led value creation strategies.

According to Bain & Company, 93% of private equity funds expect to gain moderate to significant value from AI within the next three years.

Meet the Architects of the AI-First Fund

Mubadala: Pioneering Disruption from Abu Dhabi

Mubadala is a sovereign wealth fund managing over $330 billion in assets, and has long championed investment in disruptive technologies. Its track record includes transformative bets on semiconductors (e.g. AMD, GlobalFoundries), renewable energy (Masdar), and cutting-edge AI ventures like M42 and Space42.

Their 2023 AI strategy focuses on three pillars:

1. Work Smarter – Enhancing internal operations using AI for procurement, HR, and legal.
2. Invest Better – Using AI in deal evaluation, screening, and portfolio optimisation.
3. Accelerate Impact – Enabling portfolio companies (PortCos) to harness AI for scale and efficiency.

“By the end of 2025, AI is going to be fully ingrained in everything we do.”
— Khaldoon Khalifa Al Mubarak, CEO of Mubadala

MGX: The AI-Native Investment Firm

MGX was born to be different — leaner, faster, and built around AI from day one. Backed by Mubadala and Abu Dhabi’s AI leader G42, MGX has designed an AI-native tech stack that automates everything from market research to portfolio monitoring.

Unlike traditional firms, MGX relies less on large teams and more on AI tools that:

• Automate deal sourcing and screening
• Benchmark competitors using live data
• Draft investment committee reports with generative AI
• Identify M&A opportunities with predictive analytics

“Fusion with AI starts in MGX.”
— Ahmed Yahia Al Idrissi, CEO of MGX

Use Cases: Where AI Is Already Winning

According to Bain’s survey of $3.2 trillion in AUM across 30 PE firms, AI is already delivering value in:

One fund’s AI team generated $150M+ in EBITDA uplift across portfolio companies within a year.

Why Early Adopters Are Pulling Ahead

Firms that embraced AI early are now 2x ahead in team size and capability. While late adopters maintain ~20 AI-focused staff, pioneers like MGX have upwards of 40–70 professionals blending data science with finance.

Moreover, Limited Partners (LPs) are taking notice. In fact, 77% of LPs now prefer funds that leverage AI in their investment process — a critical edge in a competitive fundraising environment.

“AI-enabled funds will ultimately emerge as the winners.”
— Senior AI Specialist, Global Fund

AI-Driven Culture: Beyond Technology

Success isn’t just about buying the right tools. It requires reimagining the fund’s DNA.

To transform into AI-native firms, investment funds must invest in:

• Data Infrastructure: From proprietary deal data to external datasets and real-time signals
• Organisational Change: Smaller, senior teams empowered by AI agents
• Talent and Training: Upskilling teams across functions in AI literacy
• Agile Execution: Fast cycles of prototyping, testing, and pivoting
• Ecosystem Integration: Collaborations with academia, regulators, and AI startups

One fund surveyed embedded its AI team directly into the investment function, allowing for end-to-end integration — from due diligence to exit.

Global Context: Why the UAE Is Leading This Shift

Abu Dhabi isn’t just home to Mubadala and MGX — it’s a global AI powerhouse. The UAE:

• Appointed the world’s first Minister of AI in 2017 (ai.gov.ae)
• Launched the Mohamed bin Zayed University of AI (MBZUAI) in 2019
• Ranked 5th globally for AI ecosystem vibrancy (Stanford HAI, 2024)

With institutions like Bayanat and G42 Healthcare, the UAE has built a blueprint for fusing national policy, academia, and capital to become a global AI investment nexus.

The Next Five Years: What to Expect

By 2030, the investment fund landscape may look completely different:

• Junior analyst roles replaced by AI agents
• Due diligence windows shrinking from months to hours
• Real-time portfolio steering via predictive analytics
• Higher deal competition, driving valuation premiums for high-quality assets
• Capital concentration favouring AI-native funds

“Few winners will crack the code on using AI to generate better returns — and the capital will follow them.”
— Senior Executive, Mubadala

Final Thoughts: Investing in the Age of Intelligence

The lesson from Mubadala and MGX is clear: AI is no longer optional — it’s foundational. The funds that succeed will not be those that experiment with AI but those that build with it.

As we enter this new era, fund managers, investors, and portfolio companies must ask:

• Are we AI-literate?
• Do we have a data strategy?
• Are we agile enough to lead?

If the answer is no, the time to act is now.