The venture capital sector in the Kingdom is worth 3 billion Saudi riyals, recording a remarkable growth of 387% in the total venture capital sector in the last five years, and more than 100 investors participated in supporting the entrepreneurship and emerging technologies sector. The Kingdom also ranked first in terms of the number of investment deals with a number exceeding 178 investment deals, accounting for more than 31% of the total volume of deals in the region.
The venture capital sector works to stimulate digital transformation and economic prosperity in the Kingdom and contributes to creating new technical and digital job opportunities, improving the quality of life of citizens, and increasing local content by adopting technological solutions with an accelerating social and economic impact.
This comes within a meeting organized by the Asharqia Chamber, represented by the Eastern Province Youth Business Council, on Wednesday evening, February 5, 2025, in its branch in Qatif, under the title “Empowering Entrepreneurship.. The Role of Investment Funds and Banks in Supporting Small and Medium Enterprises” in the presence of several male and female entrepreneurs, and those interested in small and medium enterprises. During the meeting, it hosted representatives from the Small and Medium Enterprises Bank and the Waed Ventures Investment Fund, to highlight the role of entities in empowering entrepreneurs, review the challenges and opportunities in financing small and medium enterprises, and the importance of partnerships between banks and funds in supporting projects.
The Small and Medium Enterprises Bank, established by the General Authority for Small and Medium Enterprises (Monsha'at), aims to increase financing provided to the small and medium enterprises sector, bridge the financing gap, enhance the contributions of financial institutions in providing innovative financing solutions, and achieve financial stability for this vital sector to be a fundamental pillar of economic development in the Kingdom and an enabler for achieving Vision 2030. The bank is based on a vision that emphasizes being a fundamental enabler of financing solutions for small and medium enterprises and enhancing their role in the Kingdom's economy, and a mission that works to open financing horizons for small and medium enterprises by providing products and services through innovative digital channels in integration with local and international partners to achieve a sustainable business model by the best international practices. The importance of small and medium enterprises in the national economy comes from the fact that they constitute the largest number in terms of classification among other commercial establishments, and they are considered the actual generator of creating new job opportunities in the private sector, and they contribute to the gross domestic product increasingly as a result of the support programs allocated by development agencies to achieve the goals of the Kingdom's Vision 2030. Small and medium enterprises are also considered a fundamental pillar in supporting innovation and innovative sectors through the flexibility of applying and creating these innovations and promising sectors, and they contribute to the diversification of Local economy sectors.
The portal is characterized by easy access to appropriate financing, which increases the rate of lending, investment, and economic development, saves time and effort, reduces financing costs, expands the customer base, reaches promising areas, and opens the door to competition between financing agencies to provide appropriate financing offers.
Wa'ed Ventures, Aramco's private investment arm, with a total value of $500 million, aims to invest in the fields of sustainability, manufacturing, industry, digital services, and social innovation. One of the fund's most important goals is to develop the startup ecosystem in the Kingdom of Saudi Arabia by studying gaps, whether financial or technological. The artificial intelligence sector was identified as one of the promising sectors that need investment and localization, and the fund adopted a strategy that focuses on investing in the entire value chain.
As a result, the fund recently announced the allocation of $100 million to invest in global startups focused on artificial intelligence. This decision comes within the framework of the fund's strategy aimed at promoting innovation and economic growth in the Kingdom. Wa'ed has previously led investment rounds in advanced sectors such as quantum computing, where it invested in the French company "Pasqal", one of the most important enablers of the artificial intelligence sector in the future. It also announced last year's investment in "Rebellions", a South Korean chip manufacturing company.
The fund also shared its vision in a previous statement that its investment in AI is not just a strategic move as venture capital investors, but also a commitment to accelerating the Kingdom’s efforts in the global technology and innovation race.
