Venture Capital in Saudi Arabia
Venture capital in Saudi Arabia has become the largest startup funding market in MENA, anchored by sovereign capital, corporate venture arms, and a growing layer of Saudi general partners. According to MAGNiTT, Saudi-headquartered startups raised approximately USD 1.72 billion across 257 disclosed deals in 2025, a 145 percent year-on-year increase by capital and a 45 percent jump in deal count.
The architecture supporting that flow now spans four overlapping tiers: sovereign anchors (Sanabil Investments, the Public Investment Fund directly, SVC), corporate venture arms (Wa’ed Ventures, stc Ventures, SABIC Ventures), independent general partners (STV, Raed, Impact46, Hala Capital, Merak, Nama, Vision Ventures), and family-office or angel syndicates (Olayan, Alturki, Misk Angel Network). Capital is routed through this stack via fund-of-funds commitments, direct co-investments, and a growing pipeline of secondary transactions. The result is a market where pre-seed cheques as small as USD 250,000 sit alongside USD 250 million Series E rounds without obvious capital gaps.
Three structural shifts deserve attention. First, mega-rounds — single deals above USD 100 million — accounted for nearly half of 2025’s total deployment, concentrated in fintech and e-commerce/quick-commerce. Second, exit activity began catching up with capital deployment, with M&A transactions multiplying 3.5x year-on-year in the first half of 2025 and Tabby and Tamara pursuing Tadawul IPOs. Third, the Capital Market Authority and SAMA have liberalised fund formation rules, drawing international general partners (TPG, Wellington, Blue Pool Capital, Investcorp) into local syndicates rather than purely as offshore co-investors.
Sanabil Investments: PIF’s Venture and Growth Arm
Sanabil Investments, the venture and growth-equity arm of the Public Investment Fund, is the single most important capital allocator in the Saudi private markets. Founded in 2009 and headquartered in Riyadh, Sanabil deploys approximately USD 3 billion per year across venture, growth equity, and small-buyout strategies — both as a fund-of-funds limited partner and as a direct investor in technology companies.
Sanabil’s disclosed portfolio allocation as of year-end 2024 weighted 50 percent to venture capital, 30 percent to private equity, and 20 percent to a liquid public-equity sleeve, with cash effectively at zero. That weighting is unusually venture-heavy for a sovereign-anchored vehicle and explains why Sanabil names appear on the cap table of nearly every Saudi mega-round. The firm is an LP in marquee global managers (Sequoia, Andreessen Horowitz, General Catalyst, TPG, Insight Partners) and runs a parallel direct programme targeting seed through Series C in artificial intelligence, fintech, enterprise software, logistics, healthtech, edtech, and clean energy.
Recent direct deals include co-leading the USD 157 million Hala Series B alongside TPG, anchoring Salla’s USD 130 million pre-IPO round with Investcorp and STV, and backing US-based AI infrastructure companies including World Labs. Sanabil also operates the Sanabil Accelerator powered by 500 Global, now in its tenth cohort, which has run early-stage Saudi founders through a structured Riyadh-based programme since 2019. The accelerator functions as a feeder into Sanabil’s direct portfolio and into the broader Saudi VC syndicate network.
The strategic effect of Sanabil’s scale is that no Saudi general partner can credibly raise a fund without engaging the firm — either as an LP, as a co-investor, or as a downstream growth-stage exit partner. That gravitational pull has produced a more concentrated GP market than headline deal counts suggest.
STV (Saudi Technology Ventures)
STV remains the largest independent technology-focused venture firm in MENA, with assets under management north of USD 1.4 billion across multiple funds. Anchored by Saudi Telecom Group (stc) and supported by additional institutional limited partners, STV was founded in 2018 by Abdulrahman Tarabzouni, who previously led product partnerships at Google’s MENA business.
STV’s first fund, sized at USD 800 million, established the firm’s credibility through its position in Careem ahead of the USD 3.1 billion Uber acquisition — the deal that proved billion-dollar regional outcomes were achievable. Subsequent funds have backed two additional unicorns in Tabby (now valued at USD 3.3 billion following its Series E pre-IPO round) and Jasper AI in the United States, alongside Salla, Trella, Foodics, and Lean Technologies. The firm’s typical cheque ranges from USD 5 million to USD 50 million for Series A through growth stages, with sector concentration in fintech, e-commerce, edtech, enterprise SaaS, and digital health across the GCC and Turkiye.
In 2025 STV participated in Tabby’s USD 160 million pre-IPO round (the largest single deal of Q1) and continued to back Salla, where it sits alongside Sanabil and Investcorp on a cap table positioned for a Tadawul listing. The firm’s late-stage allocation has grown more conservative as portfolio companies near liquidity events, with new commitments tilting toward earlier-stage AI-native and B2B software companies.
For the broader market, STV functions as the bellwether GP: pricing benchmarks, portfolio support patterns, and exit timing decisions at STV influence how every other Saudi fund manager calibrates strategy. The firm’s published thesis — that MENA’s tech adoption curve runs five to seven years behind global peers but with steeper consumer penetration — remains the dominant narrative driving fund-formation activity.
Raed Ventures
Raed Ventures, founded in 2015 by the Almajdouie family-office holding company, occupies the early-growth slot in the Saudi GP map. Operating from Riyadh under managing partner Omar Almajdouie, the firm has invested in 55-plus companies, with 7 new positions added in the trailing twelve months ending September 2025. Raed III, the firm’s current vintage, was anchored by SVC and targets seed and Series A across Saudi Arabia and the broader MENA region.
Cheque sizes typically run USD 2-10 million, with the firm leading rounds and taking board seats. Notable portfolio names include Mrsool (on-demand delivery, where Raed co-led the Series A alongside STV), Sary (B2B e-commerce, USD 30-million-plus raised), Calo (meal subscription), Floward (flowers and gifting), and Rize (rental fintech, which closed a USD 35 million Raed-led Series A in early 2025). The firm’s investment thesis emphasises digital infrastructure for under-penetrated markets — payments, logistics, vertical SaaS — rather than consumer-internet plays where capital intensity has trapped earlier vintages.
Raed differentiates from Sanabil and STV through operating proximity: smaller fund size means deeper involvement with portfolio CEOs on hiring, market expansion, and follow-on financing strategy. The firm’s relationship with Almajdouie Holding also gives portfolio companies access to industrial logistics infrastructure, which has been particularly relevant for B2B commerce and supply-chain plays expanding from the UAE into Saudi Arabia.
Wa’ed Ventures (Saudi Aramco)
Wa’ed Ventures is the entrepreneurship and venture arm of Saudi Aramco, structured as a USD 500 million corporate VC fund focused on technology and localisation. Established more than a decade ago and operating from Dhahran, Wa’ed has deployed approximately USD 270 million across 75-plus portfolio companies. Cheque sizes run up to USD 20 million per deal, with the firm participating in seed through Series C rounds.
The portfolio mix reflects Aramco’s strategic priorities: industrial automation, energy technology, cybersecurity, AI semiconductors, and adjacent digital health and agritech themes. Notable investments include Iyris (formerly Red Sea Farms, agritech), Pasqal (Paris-based quantum computing co-founded by Nobel laureate Alain Aspect), and Rebellions (Korean AI semiconductor startup). In 2024 Wa’ed announced a USD 100 million carve-out specifically for early-stage AI deals and appointed an advisory board of AI specialists to source and accelerate localisation in the Kingdom.
Wa’ed’s structural advantage is integration with Aramco’s procurement, technical-services, and partnership ecosystem. Portfolio companies in industrial verticals can secure pilot deployments at Aramco facilities, accelerate certification with the Saudi industrial supply chain, and access the company’s joint-venture network. Wa’ed also operates the Wa’ed Entrepreneur Seed Fund, providing pre-seed cheques up to SAR 3 million for founders building solutions adjacent to Aramco’s core operations. Separately, Aramco committed an additional USD 4 billion across its broader corporate venture programme in 2024, expanding the parent company’s exposure to climate tech, hydrogen, and downstream chemicals beyond Wa’ed’s mandate.
Saudi Venture Capital Company (SVC)
The Saudi Venture Capital Company (SVC) is the government-backed fund-of-funds established in 2018 under the SME Bank umbrella with a USD 3 billion mandate to stimulate venture financing across the pre-seed to pre-IPO continuum. As of 2026 SVC has committed more than SAR 2.8 billion across 50-plus underlying funds, indirectly supporting hundreds of early-stage companies, while running a parallel direct co-investment programme.
SVC’s catalytic role is twofold. Domestically, the firm anchors first-time Saudi general partners — including managers like Nama, Merak, and Vision Ventures — providing the scale required to attract institutional LPs and crowd in international co-investors. Internationally, SVC has begun deploying outside the Kingdom strategically: in late 2025 the firm committed USD 267 million (SAR 1 billion) across 17 venture, private-equity, and private-debt funds managed by 11 US fund managers, designed to deepen knowledge transfer and unlock co-investment access into Saudi-headquartered companies.
The firm’s mandate continues to evolve. SVC has signaled an intention to channel a larger share of its USD 3 billion budget into private credit, reflecting both LP demand for yield and the maturation of Saudi venture-debt providers including Lendo and Forus. The strategic implication is that SVC is shifting from a pure VC capital catalyst into a broader private-markets architect, positioning Saudi fund formation across the full alternative-asset stack rather than venture in isolation.
Hala Capital, Impact46, and the Independent GP Layer
Beyond the four anchors above, a layer of independent general partners has formed the backbone of Saudi early-stage activity. Hala Capital, founded in 2018 by Ali Abussaud and Hussain Almarhoon as Hala Ventures, formally rebranded in 2025 to reflect its expansion into private equity and private credit alongside venture. The firm holds a CMA licence as a regulated private-capital asset manager and has made 46-plus investments, including positions in NearPay and Hala (the fintech, no relation to the firm) ahead of its USD 157 million Series B led by TPG and Sanabil.
Impact46 is a Riyadh-based asset manager with multiple specialised vehicles totalling more than USD 200 million in commitments. The firm’s strategy spans seed through growth stages with a particular emphasis on Saudi-domiciled fintech, e-commerce, and SaaS. Impact46 participated in the Hala fintech Series B alongside TPG, Sanabil, QED, Raed, and Middle East Venture Partners, illustrating the syndicated structure of Saudi mega-rounds.
Vision Ventures, Merak Capital, Nama Ventures, and Outliers VC fill out the GP layer. Vision Ventures has anchored seed-stage rounds including NearPay’s Series A. Merak Capital, CMA-licensed and focused on technology, completed 2025 deployments into Khosouf Studio (a UAE-based game developer expanding into Saudi Arabia), DOO (Arabic-first AI), and ByNow (B2B BNPL). Nama Ventures secured its full CMA licence in May 2025 and now operates as a fully regulated Saudi VC, with 55-plus investments including Pieship and Nodes. Each of these managers typically writes USD 250,000-3 million pre-seed and seed cheques, providing the entry-stage scaffolding that feeds upstream rounds led by STV, Raed, and Sanabil.
Family Office Funds and Strategic Investors
Saudi family offices have become quietly material LPs and direct investors. The Olayan Group, the Alturki Group, the Almajdouie family (parent of Raed Ventures), the Al-Muhaidib family, the Al-Naghi family, and the Al-Faisaliah Group all maintain direct private-markets exposure either through dedicated venture sleeves or via co-investment into PIF- and SVC-anchored vehicles. Disclosure standards are minimal, but MAGNiTT’s investor database and CB Insights both track 19-plus active Saudi family offices in venture deals as of 2025.
Corporate venture arms outside Aramco have multiplied. stc Ventures, the venture arm of Saudi Telecom and a key STV LP, runs a parallel direct programme focused on telecom-adjacent infrastructure. SABIC Ventures backs industrial chemistry and materials-science startups. Al Rajhi Bank operates an in-house fintech accelerator that produces a steady pipeline of Series A-ready companies. The Misk Foundation, established by Crown Prince Mohammed bin Salman, supports earlier-stage activity through the Misk Innovation accelerator and an angel network that has trained thousands of young Saudi founders since 2017.
International investors have intensified their engagement. Sequoia, a16z, and Insight Partners are LPs in Sanabil. TPG and Investcorp now lead Saudi mega-rounds directly. Mubadala (UAE), QIA (Qatar), and ADQ (UAE) cross-invest into Saudi cap tables despite GCC capital-flow politics. Wellington Management and Blue Pool Capital co-led Tabby’s pre-IPO round. The result is that Saudi cap tables increasingly resemble those of European or Southeast Asian growth companies, with sovereign anchors, regional VCs, and global crossover funds layered together.
Recent Deals 2024-2026
The deal calendar through 2025 was anchored by a small number of mega-rounds that drove most of the headline capital figures:
- Tabby — USD 160 million Series E pre-IPO (Q1 2025). Largest single Saudi deal of the year, led by Blue Pool Capital and Hassana Investment Company, with STV and Wellington Management participating. Valuation of USD 3.3 billion, up from USD 1.5 billion in late 2023.
- Ninja — USD 250 million pre-IPO round (2025). Quick-commerce platform and the largest single Middle East deal by company headquarters, driving the e-commerce/retail vertical to 36 percent of Saudi capital deployment in H1.
- Hala — USD 157 million Series B (Q3 2025). Fintech infrastructure platform, led by TPG and Sanabil with participation from QED, Raed, Impact46, and Middle East Venture Partners.
- Salla — USD 130 million pre-IPO (2025). E-commerce SaaS platform led by Investcorp, Sanabil, and STV, positioning the company for a Tadawul listing.
- Rize — USD 35 million Series A (Q1 2025). Rental fintech led by Raed Ventures.
E-commerce and fintech together absorbed more than 60 percent of 2025’s deployment. Fintech funding alone grew 275 percent year-on-year in H1, propelled by the Tabby and Hala rounds and supported by Saudi Central Bank licensing reforms. E-commerce expanded 78 percent on the back of Ninja and Salla.
Exits
Saudi VC exit activity remains the ecosystem’s structural weak spot, though 2025 marked visible progress. M&A volumes rose 3.5x year-on-year in H1 2025, albeit from a low base of two transactions. The Tabby IPO preparation — with banks and law firms engaged for a Tadawul listing — represents the most significant pending exit and would establish a public-market valuation benchmark for Saudi-headquartered fintech. Tamara, which crossed unicorn status in 2024, posted SAR 25.8 million in net profit in Q1 2025 versus a SAR 62.1 million net loss a year earlier, supporting its own IPO readiness work.
Strategic acquisitions remain the dominant historical exit channel, headlined by the Careem-Uber transaction in 2019. More recent activity includes Foodics’ international expansion via tuck-in acquisitions, Lean Technologies’ Series B (which functioned as a partial liquidity event for early backers), and a quiet secondary market in which Sanabil and SVC have stepped in as buyers of early-investor positions in pre-IPO names. The pre-IPO secondary channel is structurally important: it allows seed-stage funds with vintage-2017 capital to return cash to LPs ahead of public listings that may not occur for two to three years.
Saudi vs. UAE and Wider GCC Comparison
Saudi Arabia’s leadership in MENA venture is now structurally entrenched but worth situating against the UAE and smaller GCC neighbours. The UAE recorded USD 1.58 billion in 2025 funding across 231 deals, ranking third globally after Singapore and Saudi Arabia. The UAE concentrates on early-to-mid-stage diversification with strength in fintech, AI, and proptech, supported by Dubai’s tech-hub infrastructure and Abu Dhabi’s climate-investment thesis driven by Mubadala and ADQ. Combined Saudi-UAE deployment of USD 3.13 billion accounts for more than 80 percent of MENA’s total.
Qatar’s QIA and Bahrain’s BIPA play smaller but meaningful roles, primarily as LPs in regional funds rather than direct investors. Egypt’s tech ecosystem has slowed under macroeconomic pressure and currency volatility, though companies like Paymob continue to attract Saudi backing as part of MENA expansion theses. The competitive dynamic between Riyadh and Dubai has shifted decisively in Saudi’s favour for late-stage capital and IPO readiness, while the UAE retains advantages in expat talent density and offshore corporate structuring.
For founders, the practical implication is that Saudi-domiciled companies now command a valuation premium because they can access both the deepest local capital pool and the Tadawul listing path, while UAE-headquartered companies pursue ADX or DFM listings or hold out for cross-border M&A. The two markets are increasingly complementary rather than substitutes.
The Regulatory Environment
The Capital Market Authority regulates Saudi venture capital activity, and a sequence of reforms since 2019 has materially simplified fund formation. The Authorized Persons Regulations, the Special Purpose Entity framework, and updated Investment Funds Regulations now allow domestic and international fund managers to launch Saudi-domiciled vehicles with a fraction of the friction that existed pre-Vision 2030. CMA licensing for VC firms — held by Nama, Merak, Hala Capital, Impact46, and others — has become the de facto credentialing standard for fundraising from institutional Saudi LPs.
The Fintech Saudi initiative, jointly operated by SAMA and CMA, runs regulatory sandboxes that allow VC-backed fintech startups to test products in a controlled environment before obtaining full licences. Tabby, Tamara, Hala, and Lean Technologies all moved through some form of sandbox or limited-licence regime before scaling to general operations. SAMA’s payment-services licence regime, in particular, has been the structural enabler for the BNPL category that produced Saudi’s first unicorns.
Tax remains comparatively favourable: no personal income tax, no capital gains tax for qualifying Saudi residents, and a 20 percent corporate income tax with various sector-specific exemptions. The Regional Headquarters programme, requiring multinationals to base their MENA HQ in Riyadh to bid for government contracts above a threshold, is a less direct but increasingly material structural tailwind for Saudi-domiciled corporate venture activity.
Outlook
Three signals will determine whether Saudi venture sustains its 2025 trajectory through the remainder of the decade. First, exit performance: Tabby’s IPO and Tamara’s listing decisions through 2026 will reset valuation benchmarks for the entire stack. A successful Tabby Tadawul debut at or above its USD 3.3 billion private mark would confirm that public markets can absorb Saudi tech at scale; an underwhelming outcome would compress later-stage valuations and slow the secondary market. Second, fund-formation depth: SVC’s pivot toward private credit and the Sanabil accelerator’s tenth cohort suggest the GP base is broadening rather than concentrating, but the next test is whether Saudi-trained partners begin spinning out from STV, Raed, and Sanabil to launch second-generation independent funds. Third, AI deployment: Wa’ed’s USD 100 million AI carve-out, Sanabil’s positions in US AI infrastructure, and HUMAIN’s emergence as a sovereign AI vehicle suggest the next funding cycle will tilt heavily toward enterprise AI and AI semiconductors rather than the consumer-fintech wave that produced the current unicorns.
PIF’s mandate to grow assets under management to USD 2 trillion by 2030, the government’s target of creating 1 million-plus SME jobs through programmes coordinated by Monsha’at, and the steady CMA reform pipeline all point toward continued capital availability. The risk vector is concentration: with Sanabil, STV, and SVC anchoring the majority of meaningful rounds, a slowdown at any one of these institutions would compress mid-stage liquidity faster than diversified ecosystems would experience. For now, however, Saudi Arabia’s venture machine is the largest and fastest-growing in MENA, with no credible regional competitor on the horizon.
See our Saudi Arabia Technology Parks, Fintech Saudi Arabia, PIF Portfolio, Sanabil Investments, SVC, and Tadawul listings tracker guides for related insights. External references: MAGNiTT H1 2025 Saudi VC Report, Reuters Saudi VC coverage, Arab Gulf Business Insight (AGBI) startup tracker, and Wamda regional reporting.