PIF-backed Jada to invest $266m to support venture debt in Saudi Arabia

This is the first investment made by the Riyadh-based company in venture debt and its second in the private credit space

Jada Fund of Funds aims to encourage the growth and sustainability of innovative businesses in Saudi Arabia. EPA

Jada Fund of Funds, a subsidiary of Saudi Arabia’s Public Investment Fund, is investing in a 1 billion Saudi riyals ($266 million) fund as it aims to support the growth of the venture debt ecosystem in the kingdom.

The investment in Partners for Growth VII, managed by global private credit manager Partners for Growth, is the first investment made by the Riyadh-based company in venture debt and the second in the private credit space, Jada said.

The fund provides investors with exposure to fast-growing and high-potential mid-market companies across a variety of sectors.

Partners for Growth, an international fund manager that has assets under management worth $1 billion, has secured commitments from a “wide range of sophisticated institutional investors from around the globe”, Jada said.

“Last November, we announced our first investment in private credit and promised to make additional investments in this asset class in the near future,” Bandr Alhomaly, chief executive of Jada Fund of Funds, said.

It announced its first investment in private credit space with an investment in Ruya Partners’ $250 million fund.

“Our strategy reinforces our commitment to providing additional funding solutions and attracting foreign direct investment to promote economic growth and diversification guided by Vision 2030,” Mr Alhomaly added.

Jada, which was established by the PIF with an investment capital of about $1 billion, is providing funding to small and medium enterprises in Saudi Arabia through investments in venture capital and private equity funds.

As of March 2024, Jada has invested in 39 funds, with 3.5 billion riyals committed. Through these funds, it has supported the creation of around 12,000 jobs in Saudi Arabia and supported over 500 SMEs, it said.

In August, it joined forces with private equity fund manager Aliph Capital to support SMEs with an investment in GCC-focused Aliph Fund I.

Aliph Fund I is a $250 million target PE fund based in Abu Dhabi Global Market, and invests in midsized GCC companies.

Jada has also committed to investing in Investcorp’s $500 million Saudi pre-initial public offering growth fund, it said in June.

In 2023, Jada said it made commitments worth 1 billion riyals, contributing to Saudi Arabia ranking first in the Middle East and North Africa region in venture capital funding for the first time.

Saudi Arabia is focusing on diversifying its economy away from oil with an emphasis on the development of sectors such as technology, property, tourism and infrastructure as part of Vision 2030.

The kingdom is supporting the development of several industries spanning different sectors to generate employment and help its non-oil economy to grow.