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Meet the Most Active Investors In Saudi Arabia This list has been compiled for (Saudi) startup founders to get familiar with- in case you might approach them in the future, to assess their impact on your cap table.

By Erika Masako Welch

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In our report on the evolution of Saudi Arabia's startup ecosystem, we looked at who has supported the most Saudi-based startups, which are, in turn, the trailblazers that are currently birthing Saudi's startup ecosystem. In this article, we present to you the most active Saudi investors, from venture capital (VC) firms to dominant accelerator and incubator programs.

What makes an "active" investor, you might ask. We define and measure "active investors" based on the number of local Saudi startups in their portfolio; for the purposes of this ranking, we also count imported startups (e.g. Trukker) that are headquartered outside of the Kingdom, but have significant operations in the country. All data in this article was obtained and verified directly from VCs by Lucidity Insights and is current through to the end of October 2022. To be considered a active Saudi startup, the startup must either be locally homegrown (ie. incorporated in the Kingdom), or a imported startup that may be born elsewhere, but has significant operations in the Kingdom. Only investments in startups that are still active today have been considered.

When reviewing the data below, one should consider that the majority of VCs in the Kingdom's entrepreneurial investor landscape still focus on early-stage (seed) and a few growth-stage (Series A) investments to match both the maturity and the needs of the market. VCs highlighted here are illustrative and non-exhaustive. In fact, Saudi Arabia has over 65 active VCs registered in the Kingdom.

It is also important to keep in mind that it is typical for investors that focus on early-stage investing to invest in a higher number of startups, and those with a later-stage focus to invest in less, due to the ticket sizes being considerably higher the more mature a startup becomes. It is important to note here then, that in that light, this is not a ranking. Different investor models cannot be compared. Accelerators and incubators that pump out hundreds of startups out of its machine each year cannot be compared to VC firms that may only invest in a handful of quality startups each year, which they provide dedicated attention and nurture. Each investor business model has its place and its benefits for startup founders.

This list below has simply been compiled for (Saudi) startup founders to get familiar with- in case you might approach them in the future, to assess their impact on your cap table. As for who's inking the most deals in Saudi Arabia, the answer is clear. Wa'ed Ventures has invested in the most local Saudi startups, with 43 in its portfolio as of October 28, 2022. 500 Global follows with 38 investments, and Impact46 and King Abdullah University of Science and Technology (KAUST) Innovations Ventures are tied for third place with 27 Saudi startups in each of their portfolios.

#1: Wa'ed Ventures

Wa'ed Ventures is a local venture capital firm that champions local Saudi startups; they have a sizable portfolio, with 43 Saudi startups disclosed.

Wa'ed Ventures is the VC arm of Saudi Aramco with a $500 million venture fund to invest in the next generation of transformative startups that are taking advantage of disruptive technologies. Wa'ed Ventures see entrepreneurs as their (and any VCs) biggest asset. They seek to partner with passionate entrepreneurs disrupting traditional industries through revolutionary ideas. The firm is one of the most active investors in the region, with $100+ million deployed in 2022 alone.

Being one of the earliest players in the Saudi venture space, Wa'ed Ventures quickly outpaced the rhythm of the market when it came to adopting a risk-tolerant and thematic investment approach. The fund aims to drive local economic growth and diversification by becoming the partner of choice for founders, by building long-term partnerships where Wa'ed Ventures actively participates in follow-on funding rounds. Wa'ed Ventures invests in startups from the early seed stages to the mid- and late-growth stages with a ticket size of up to $20 million.

Wa'ed Ventures is a sector-agnostic fund; however, as a tech-focused investor, technology remains the key factor behind the startups it bets on. Specifically, the firm seeks technologies that present wide applications, geographical adaptability, and strategic relevance to the Kingdom, as well as to Saudi Aramco.

#2: 500 Global

500 Global takes on more of an accelerator and incubation model, and has directly invested in 38 portfolio companies in Saudi Arabia.

500 Global is a global venture capital firm that invests across stages with a focus on technology and innovation. 500 Global has invested in the MENA through several funds, including 500 Falcons and the Riyadh-based Sanabil 500 MENA Seed Accelerator Fund, serving entrepreneurs across the region. 500 Global has invested in more 38 startups in Saudi Arabia.

As explained by Amal Dokhan, a General Partner at 500 Global MENA, 500 Global does make direct investments, and the firm is starting to see more requests for Series A investments in the Kingdom and the greater MENA region. Dokhan is also responsible for overseeing the Sanabil 500 MENA Seed Accelerator program and fund. The joint accelerator program with Riyadh-based VC Sanabil also makes investments outside of the accelerator, and has birthed seven direct investments so far.

#3: Impact46

Impact46 has 27 disclosed local portfolio companies in Saudi Arabia.

Impact46 is an asset management and advisory firm established in 2019, focused on alternative investment opportunities.

The firm's name comes from Riyadh, the city in which Impact46 is based, which sits on the planet's 46th longitudinal line. In a few short years, Impact46 has made its mark predominantly investing in Saudi startups (27 out of the firm's 33 portfolio companies are Saudi startups), and have already seen three successful exits in Jahez (which has an initial public offering (IPO) in 2021 to reach unicorn status), Tamara, and Lendo.

Impact46 Partner Basmah Alsinaidi explained that when Impact46 launched its first seed stage fund in 2019, their original target was to earmark 70% of the fund for Saudi startups. Today, close to 90% of Impact46's funding has gone to Saudi-based startups. The rest have gone to startups in the UAE and Egypt.

Alsinaidi furtherly explained that Impact46 is sector-agnostic, but follows the "unicorn replication strategy" to derisk their investments. That's why Impact46 have invested heavily in fintech, marketplace solutions, and on-demand services following the universal unicorn trends. "We are backing the Asanas, Stripes, and Paypals of the Saudi market," says Alsinaidi.

#3: KAUST Innovation Ventures

KAUST Innovation Ventures has 27 disclosed local portfolio companies in Saudi Arabia.

KAUST Innovation Ventures supports the University's pipeline of deep-tech based startup companies. It also invests in high-profile international technology companies willing to establish their operations in Saudi Arabia and to benefit from synergies with KAUST.

KAUST Innovation Ventures manages a portfolio of homegrown KAUST spinouts and also international deep tech startup spin-ins. The Fund aims to grow an innovation and technology investment community and attract international investors and VCs to the emerging Saudi technology ecosystem. It then becomes a long-term strategic partner of these ventures through seed to early-stage investments. Startup companies are curated through their entrepreneurial programs such as Taqadam and Destination Deep Tech.

Hattan Ahmed, Entrepreneurship Director at KAUST, believes that deep tech fundraising has got a lot of white space in Saudi Arabia, and while there has been significant growth over the past few years in fintech, softwares as a service (SaaS), and ecommerce transactions, there is still a significant gap in deeptech investments.

#4: Raed Ventures

Raed Ventures has 20 disclosed portfolio companies in Saudi Arabia.

Raed Ventures is an early and growth stage venture capital firm established in Riyadh in 2015. Raed Ventures partners with exceptional founders building transformative companies in the MENA region. The firm was also the first private VC established in the Kingdom in 2015. 20 out of 39 companies are Saudi-based. Raed Ventures has had five successful exits to date, though none yet from its Saudi startup roster.

#4: Vision Ventures

Vision Ventures has 20 disclosed local portfolio companies in Saudi Arabia.

Vision Ventures (VV) is a VC by entrepreneurs, for entrepreneurs. Its team are ex-founders who have the mission of helping founders succeed. VV invests in early-stage tech startups in the seed and Series A funding rounds. Vision Ventures is a sector-agnostic VC, but has particular interests in the cloud, saas, cybersecurity and fintech sectors.

Since establishing in 2016 in Dammam, Vision Ventures has invested in 47 companies, 20 of which are Saudi-based. The firm has seen three successful exits thus far, including MENAbytes, POSrocket, and Munch:On.

Vision Ventures was launched in 2016 in order to diversify its parent company's business, Sahara Net, which was heavily dependent on internet services. In 2018, VV moved from a corporate venture capital to general/limited partner structure to become an independent privately run venture capital firm.

Vision Ventures has inked over 86 deals and built a portfolio of 44 startups, of which 20 are Saudi companies, and over half of which have been invested across the past 24 months. Kais Al Essa, Founding Partner and CEO of Vision Ventures explained that early-stage startups find VV's experience in the region and advice very valuable to them, often proving crucial to their success and growth, and that is why Vision is focused more on early-stage startups in the pre-seed to Series A stages.

#5: STV

STV has 19 disclosed portfolio companies in Saudi Arabia.

STV established itself in 2018, and it is the largest privately-held technology VC investment firm launched in the Middle East to date. With over $800 million in capital, STV backs and scales the region's most exciting and disruptive technology companies, primarily focused on growth-stage technology. 19 out of STV's 29 portfolio companies, and more than two-thirds of STVs deals are inked with startups with significant Saudi operations.

STV believes there is a strong and increasing dichotomy between digital supply and digital demand in the MENA region; the areas where supply has yet to meet demand are referred to "white spaces." The founder and CEO of STV, Abdulrahman Tarabzouni, says, "We identify these white spaces, and invest in companies that we believe will become the leaders in these segments and future market champions. In pursuit of our ambition to build and scale the region's top technology companies, STV remains series- and tech-sector agnostic."

STV is currently raising its second fund to replicate the same investment strategy of the first fund.

#6: Hala Ventures

Hala Ventures has 14 disclosed local portfolio companies in Saudi Arabia.

Hala Ventures is a Saudi VC firm which started operating in 2014 under the umbrella of its affiliate company, Financial Horizon Group, as a corporate fund investing in various asset classes including venture capital. Hala Ventures was later established as a standalone VC firm in 2018, with offices in both Khobar and Riyadh. Today, 37% of Hala Ventures' portfolio companies are Saudi-based, with 10 deals inked in the Kingdom so far. To date, the VC firm has seen three successful exits, though only one of the three exits was a Saudi-based startup.

Learn more about the most prominent venture capitalists in Saudi's startup ecosystem by checking out the report, The Evolution of Saudi Arabia's Startup Ecosystem 2010-2022.

This article was originally published on Lucidity Insights, a partner of Entrepreneur Middle East in developing special reports on the Middle East and Africa's tech and entrepreneurial ecosystems.

Erika Masako Welch

Chief Content Officer, Lucidity Insights

Erika Masako Welch is the Chief Content Officer of Lucidity Insights.
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