Saudi Aramco's venture capital arm Waed Ventures has earmarked $100 million to invest in early-stage artificial intelligence start-ups as Saudi Arabia seeks to diversify its economy and shift to growing non-oil sectors.
The move will contribute towards “positioning the kingdom as a global AI hub, generating a strong pipeline of global early-stage AI start-ups”, the company said on Sunday.
An advisory board consisting of global leaders in AI has been appointed by Wa’ed Ventures to support strategic deal sourcing and accelerate localisation for global start-ups. The board members come from diverse backgrounds, and included experts who have worked in Meta, Amazon, Massachusetts Institute of Technology, Oxford and other institutions, the statement said.
“By fostering innovation and supporting AI start-ups, we aim to accelerate the development of cutting-edge technologies that will drive economic growth, improve quality of life, and position Saudi Arabia as a global leader in AI,” said Anas Algahtani, acting chief executive of Wa’ed Ventures.
“This investment will not only incentivise local entrepreneurs but also support the localisation of global talent, ultimately unlocking the immense potential of AI.”
Saudi Arabia’s government plans to create a fund worth $40 billion to invest in AI, the New York Times reported in March. Representatives of Saudi Arabia's Public Investment Fund have discussed a potential partnership with US VC firm Andreessen Horowitz and other financiers, the newspaper reported.
Saudi Arabia’s gain from AI is expected to exceed other countries in the Middle East with an estimated $135 billion in value by 2030, equivalent to 12.4 per cent of the country’s gross domestic product, according to a recent report by PwC.
Saudi Arabia, the Arab world's largest economy, emerged as the region’s most-funded country for start-ups last year. Start-ups in the kingdom raised $1.3 billion through venture capital funding, overtaking the UAE for the first time as the top destination for VC investment in the Middle East and North Africa region, according to start-up data platform Magnitt.
In the first half of this year, Saudi start-ups raised more than $400 million in capital, again the highest in the region, the data platform added.
Established in 2013, Waed Ventures is a $500 million VC firm that promotes economic diversification and new business growth in Saudi Arabia by investing in high-growth tech start-ups across multiple sectors. It manages a portfolio of more than 70 start-ups.
Wa’ed’s new AI strategy marks another initiative by the fund in keeping with its commitment towards investing in high-potential AI applications and infrastructure players.
During the past few months, Wa’ed Ventures invested in the Korean AI chip company Rebellions, as well as the California-based start-up AiXplain, a provider of essential infrastructure for accelerated AI development.
In October last year, the firm, along with Hala Ventures, led a $3.4 million pre-Series A funding round in Intella, an Egyptian deep technology start-up focusing on AI. In July 2023, Wa'ed Ventures also invested in Tenderd, a start-up that specialises in AI technologies.
