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Saudi Arabia’s Venture Capital Investments Achieve 770% Growth

A night view of Riyadh, Saudi Arabia. (AP)
A night view of Riyadh, Saudi Arabia. (AP)
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Saudi Arabia’s Venture Capital Investments Achieve 770% Growth

A night view of Riyadh, Saudi Arabia. (AP)
A night view of Riyadh, Saudi Arabia. (AP)

A recent Saudi report revealed that the Kingdom’s venture capital investments achieved a growth of 770 percent, reaching a record-high of SAR 2 billion $548 million, up from SAR 236 million in 2018.

The Saudi Venture Capital Impact report also showed that the number of investors in Saudi startups rose by 192 percent, reaching 76 in 2021, up from 26 three years earlier.

The number of venture capital deals in Saudi startups also grew by 148 percent, to a new high of 139 deals, as compared to 56 VC deals in 2018.

The impact report showed that the strategy adopted by the Saudi Venture Capital Company succeeded over the past three years in increasing the number of investors in Saudi startups, encouraging existing and new financial companies to establish venture capital funds and contributing to closing the funding gap in investment rounds.

“The Kingdom of Saudi Arabia is witnessing an unprecedented growth in the quality and quantity in the deal flow of startups,” said Dr. Nabeel Koshak, CEO of Saudi Venture Capital (SVC).

“This is a result of the emergence of many innovative entrepreneurs, VCs, and angel investor groups, in addition to the availability of an advanced regulatory and legislative environment backed by effective government programs,” he added.

The Saudi Venture Capital Company is a government-owned firm, which was established in 2018 by the Monshaat Authority within the Financial Sector Development Program (FSDP) to stimulate venture investments by investing SAR 2.8 billion ($750 million).

The report noted that the total committed investments of SVC amounted to SAR 1.2 billion, while the total committed investments including partners is estimated at SAR 6.5 billion.

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Saudi Arabia Plans to Establish Specialized Courts to Boost Investment Climate

King Abdullah Financial Center in Riyadh (Asharq Al-Awsat)
King Abdullah Financial Center in Riyadh (Asharq Al-Awsat)
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Saudi Arabia Plans to Establish Specialized Courts to Boost Investment Climate

King Abdullah Financial Center in Riyadh (Asharq Al-Awsat)
King Abdullah Financial Center in Riyadh (Asharq Al-Awsat)

Saudi Arabia is exploring the establishment of specialized courts to enhance its investment environment, aligning with the goals of the National Investment Strategy and Vision 2030. This initiative aims to support development and improvement efforts tailored to the needs and aspirations of investors.
The Kingdom has undergone an unprecedented transformation, implementing over 800 reforms to date. These include the Civil Transactions Law, the Bankruptcy Law, the Public-Private Partnership Program, and the Government Tenders and Procurement Law, which have collectively positioned Saudi Arabia as the 16th most competitive nation globally, according to the IMD World Competitiveness Index.
According to information available to Asharq Al-Awsat, the Ministry of Investment is currently consulting public and private entities to assess the necessity of specialized investment courts. This initiative focuses on improving investors’ interactions with the Kingdom’s judicial system amidst rapid legislative advancements, with the aim of bolstering Saudi Arabia’s status as a leading regional and global investment destination.
To ensure effective planning, the Ministry is working closely with key government agencies operating in strategic sectors. It has requested detailed input from relevant bodies, involving decision-makers to contribute to the project.
In August 2024, Saudi Arabia announced an updated investment law set to take effect in early 2025. This framework is designed to attract global investments, enhance the competitiveness of the local investment climate, support economic diversification, and create job opportunities, all in alignment with Vision 2030 and the National Investment Strategy.
The updated law is a cornerstone of the National Investment Strategy launched by Crown Prince Mohammed bin Salman. It aims to drive development, diversify the economy, and attract more than $100 billion annually in foreign direct investment by 2030.
The law enhances investor rights by ensuring fair treatment, protecting intellectual property, and allowing freedom in investment management and seamless capital transfers. It also provides transparency and clarity in processes, aligning with global best practices to foster a trustworthy investment environment. Simplified procedures now replace the previous licensing system, offering greater protection, flexibility, and confidence to investors conducting business in the Kingdom.
Saudi Minister of Investment Khalid Al-Falih emphasized that the updated law is part of broader reforms demonstrating the Kingdom’s commitment to creating a supportive and secure environment for both local and foreign investors. These efforts include adopting global best practices and revising the Foreign Investment Law, which was introduced 25 years ago, to develop a comprehensive investment framework that serves both Saudi and foreign investors.