Saudi Arabia has announced a substantial investment of $888 million to bolster its local tech startup and venture capital sector. This funding will specifically target industries such as digital payments, e-gaming, and artificial intelligence (AI), highlighting the kingdom’s commitment to fostering innovation and technological advancement.
The announcement was made during the Leap international technology conference in Riyadh, showcasing Saudi Arabia’s growing prominence as a market for startups. Despite a global decline in startup funding last year, the kingdom experienced a remarkable 159 percent increase in investment compared to 2022, according to venture capital firm Wamda.
Saudi Arabia’s central bank, Sama, also reported a significant surge in funding for small companies, with a 17.8 percent year-on-year increase in loans to micro, small, and medium-sized enterprises.
Investcorp, a Bahrain-based investment firm, announced the establishment of a $500 million fund in Saudi Arabia, with a $35 million investment from the company itself. This fund will primarily focus on supporting growing Saudi companies in their expansion phases.
Additionally, Oasis Capital, another Bahraini investment company, launched Fund II amounting to $100 million, aimed at supporting early-stage international tech founders.
Collaborative efforts from various entities, including the National Development Fund, Social Development Bank, Ignite, and the Saudi E-Sports Federation, have led to the creation of two significant funds. These include an $80 million accelerator VC fund managed by Merck Capital and a $40 million fund managed by Impact46, both focusing on propelling the growth of the local gaming industry.
Ibrahim Neyaz, CEO of Saudi Arabia’s National Technology Development Program (NTDP), unveiled five innovative products to enhance the kingdom’s technology, VC, and startup domains. These initiatives include “Fuel,” with a $266 million budget, aimed at supporting VC funds investing in emerging technologies such as generative AI, space tech, smart cities, and biotech.
NTDP’s “Artificial Intelligence Mission,” backed by $266 million in funding, offers a platform for research and development in AI. Over the next five years, the program aims to train 800 to 1,000 individuals in AI and machine learning, fostering the creation of 70 to 100 new AI-focused ventures.
Another initiative, “Source Tech,” aims to incentivize IT and outsourcing companies to expand services in the kingdom, with a $15 million budget. This initiative also seeks to boost women’s participation in the technology sector, creating more than 2,000 jobs.
NTDP also announced “Transform+,” aimed at bridging the technology gap for startups and accelerating cloud adoption, with a budget of $33 million.
Saudi company Takamol Holding announced a $53 million venture capital arm, Takamol Ventures, to support early-stage technology companies in the Middle East and African markets.
Startup accelerator Plug and Play, in collaboration with X by Unifonic, introduced its debut investment funds to foster tech startups in various sectors across the region.
