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Saudi Arabia leading region’s transformative journey 

Saudi Venture Capital’s strategic initiatives have positioned Saudi Arabia as a leader in venture investments within the MENA region for the first time in 2023. (SPA)
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Updated 01 October 2024
Nour El-Shaeri
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Saudi Arabia leading region’s transformative journey 

  • SVC makes significant strides in shaping private investment landscape
Updated 01 October 2024
Nour El-Shaeri

CAIRO: A wave of venture capital funding has washed over the Middle East and North Africa region, prompting transformative change in the entrepreneurial landscape.

Saudi Arabia’s government is leading the shift through a subsidiary of the SME Bank, part of the National Development Fund.  

The Kingdom’s Saudi Venture Capital has made significant strides in shaping the private investment landscape, deploying finance across 40 investment funds and over 700 startups and small and medium-sized enterprises.  

This was highlighted in the latest Impact Report issued by SVC, which detailed its contributions since its inception in 2018. 

The document revealed that SVC’s total investments have reached SR2.6 billion ($693.1 million), with the overall impact of these, including partner commitments, estimated at around SR13.6 billion.  

These investments span various sectors critical to economic diversification, such as e-commerce, fintech, healthcare, educational technologies, transportation, and logistics. 

“SVC plays a crucial part in stimulating the private VC investment to sustain and foster the steady growth of the VC ecosystem in the Kingdom,” Nabeel Koshak, CEO of SVC, said.  

“SVC’s strategy, since its inception in 2018, contributed to increasing the number of investors in Saudi startups, encouraging existing and new financial companies to establish VC funds, and motivating regional and global funds to invest in Saudi startups,” Koshak stated. 

“Accordingly, the funding deployed into Saudi Arabian startups grew 21 times to a record-high of $1.4 billion in 2023 versus $65 million in 2018, the year SVC was launched,” he added. 

Significantly, SVC’s strategic initiatives have positioned Saudi Arabia as a leader in venture investments within the MENA for the first time in 2023.  

This milestone reflects the broader economic and financial sector evolution under Saudi Vision 2030, aimed at enhancing the national economy. 

Saudi Arabia’s Penny Software closes undisclosed pre-series A round 

Closing its pre-series A funding round, Saudi Arabia’s Penny Software raised an undisclosed sum from Iliad Partners, joined by GSI and US-based Knollwood Investments, alongside existing investors such as Dallah Investment, Hambro Perks Oryx Fund, Class 5 Global, Altuwajiri family fund, and strategic angel investors.  

Founded in 2020 by Iyad Al-Dalooj, Majid Al-Dalooj, and Mohamad Ibrahim, Penny Software is a business to business Software-as-a-Service procurement startup that digitizes the entire source-to-pay process, thereby enhancing spend efficiency, governance, and compliance. 

“This investment from Iliad Partners, alongside the continued support from our existing and new investors, represents a significant vote of confidence in Penny Software’s vision and our team’s ability to execute,” Iyad Al-Dalooj, the CEO, said. 

“We are excited to leverage this partnership to scale our operations, enhance our product offering, and solidify our position as a leader in the procurement software industry. The future of procurement is here, and Penny Software is at the forefront of this transformation,” he added. 

This new capital infusion is poised to fuel Penny’s ambitions for regional and global expansion.  

This follows a successful $5 million seed funding round in 2021, led by Outliers Venture Capital with participation from Wamda, Shorooq Partners, Hambro Perks ORYX Fund, Class 5 Global, and strategic angel investors.  

Penny Software aims to leverage this investment to further enhance its platform capabilities and broaden its market reach, reinforcing its position in the competitive SaaS industry. 

The company claims that it is set to manage a gross transaction value of over $1 billion this year, and ease procurement for thousands of companies globally. 

“Saudi Arabia is an economy that is undergoing a major transformation in which technology is playing a key role. This is our first investment in the Kingdom, and we plan to invest a significant portion of our fund in this market, supporting strong founders on their journey from the pre-series A stage and onwards,” Christos Mastoras, founder and managing partner of Iliad Partners, stated   

UAE’s DocsInBox closes $500k in a funding round 

UAE’s e-invoicing and procurement startup DocsInBox closed a $500,000 funding round from angel investors to boost its presence. 

Founded by serial entrepreneurs Leonid Dovbenko and Stanislav Seleznev,  DocsInBox significantly streamlines invoicing and procurement processes, saving up to 1 million hours each month, the company claimed.  

The platform enables purchasing agents to place orders in just three clicks, while accountants can complete tasks in 13 seconds that previously took 300 seconds.  

By automating procurement, DocsInBox reduces manual labor by 15 percent, operational costs by 5 percent, and food costs by 8 percent.  

UAE’s U-topia secures $850k in funding round 

UAE-based Web3 services provider U-topia has secured $850,000 in funding from GDA Capital. 

Established in 2021 by Jérémy Mahieu and Nicolas Prévost, U-topia operates as a Web3 entertainment company that merges global intellectual property licensing in GameFi, artificial intelligence music, and video entertainment supported by non-fungible token provenance.  

The newly acquired investment is earmarked for the development of advanced features and technologies on the U-topia platform, aiming to enhance its offerings in the dynamic Web3 landscape. 

Nigeria’s VC firm Verod-Kepple Africa Ventures closes $60m fund 

Nigeria-based VC firm Verod-Kepple Africa Ventures has concluded a final close of $60 million for its pan-African VC fund, led by existing investors and new investors, including SCM Capital from Nigeria and institutional investors from Japan, including Taiyo Holdings and C2C Global Education Japan. 

Formed in 2021 as a joint venture between Kepple Africa Ventures and Verod Holdings, VKAV is led by partners Satoshi Shinada, Ryosuke Yamawaki, and Ory Okolloh. 

The fund aims to bridge the funding gap for African startups, especially for companies moving to series A and B stages. 

Egypt’s VC firm Beltone teams up with UAE’s CI Venture to manage a $30m fund 

Egypt’s Beltone Venture Capital, under Beltone Holding, has teamed up with CI Venture Capital from UAE’s Citadel International Holdings to manage a $30 million fund aimed at nurturing fast-growing startups.  

This collaborative fund is set to invest in pre-seed and seed funding rounds of innovative tech startups across the MENA region while also continuing to support standout performers within its existing portfolio. 

In recent months, the fund has actively begun deploying capital, finalizing investments in several startups, including Bosta, Trella, Qlub, and ariika.  
 

Topics: startups VENTURE CAPITAL

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Closing Bell: Saudi main index closes in green at 11,725

Updated 13 March 2025
Miguel Hadchity
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Closing Bell: Saudi main index closes in green at 11,725

Updated 13 March 2025
Miguel Hadchity

RIYADH: Saudi Arabia’s Tadawul All Share Index gained 20.95 points, or 0.18 percent, closing at 11,725.88 on Thursday. The total trading volume for the benchmark index reached SR6.20 billion ($1.65 billion), with 141 stocks advancing and 94 declining.

The MSCI Tadawul Index also saw an increase, rising by 2.36 points, or 0.16 percent, to close at 1,479.27.

In contrast, the Kingdom’s parallel market, Nomu, slipped by 37.56 points, or 0.12 percent, closing at 31,135.85. This decline came as 54 stocks rose, while 29 saw a decrease.

The top-performing stock of the day was Rasan Information Technology Co., which saw its share price surge by 9.87 percent to SR79.

Other strong performers included Saudi Chemical Co., whose share price climbed by 5.89 percent to SR8.45, and Saudi Research and Media Group, which gained 5.66 percent, reaching SR175.60.

On the other hand, Nice One Beauty Digital Marketing Co. was the worst performer, with its share price dropping by 4.99 percent to SR40.90.

National Shipping Co. of Saudi Arabia and Alandalus Property Co. also faced declines, with their shares falling by 4.29 percent and 3.55 percent, respectively, to SR29 and SR23.90.

On the announcements front, First Milling Co. reported a net profit of SR250.9 million for 2024, marking a 13.9 percent increase compared to the previous year.

The company attributed this growth to higher sales, improved product mixes and pricing, as well as the introduction of new products.

Additionally, continued growth in small-pack goods, which offer higher profit margins, alongside efficiency improvements, cost leadership, and enhanced cash management, contributed to the rise, with increased interest income from Shariah-compliant Murabaha deposits.

Despite the positive results, First Milling Co.’s share price remained unchanged at SR60.90 during today’s trading.

Umm Al-Qura Cement Co. also reported impressive results, with a net profit of SR47.7 million for 2024, a staggering 1,107 percent increase from the previous year’s SR3.9 million.

This growth was driven by higher sales volumes and values, as well as reductions in administrative expenses, financing costs, and zakat. Despite the strong performance, the company’s shares fell by 1.98 percent, closing at SR18.78.

Lastly, ADES Holding Co. announced that it had received a Shariah Evaluation Report confirming its compliance with Islamic guidelines for the year ending Dec. 31.

The report, issued by the Shariyah Review Bureau, affirmed that the company’s activities aligned with Shariah standards. ADES Holding’s shares closed 0.74 percent lower on the main market at SR16.10.

Topics: TASI NOMU MSCI

Saudi money supply up 9% to hit $791bn in January

Updated 13 March 2025
Dayan Abou Tine 
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Saudi money supply up 9% to hit $791bn in January

Updated 13 March 2025
Dayan Abou Tine 

RIYADH: Saudi Arabia’s money supply climbed to SR2.97 trillion ($791 billion) in January, marking a 9 percent annual rise, official data showed. 

According to figures from the Saudi Central Bank, known as SAMA, demand deposits accounted for 48.75 percent of the total, reaching SR1.45 trillion. While still below the April 2021 peak of 60.21 percent, they edged up from 48.42 percent a year ago, reflecting shifting monetary conditions. 

Demand deposits are a crucial part of the money supply. When individuals deposit money into checking accounts, it increases the total amount of demand deposits, thereby expanding the overall money supply in the economy.

A demand deposit refers to money held in a bank account that can be withdrawn at any time, whenever the account holder requires it.

These funds are generally used for everyday expenses. Banks or financial institutions typically offer little to no interest on the balance in a demand deposit account.

Time and savings deposits — which surged during the US Federal Reserve’s aggressive rate hikes, mirrored by Saudi Arabia due to the riyal’s peg to the US dollar — reached SR985.03 billion in January, accounting for 33.21 percent of total deposits. 

As the Fed began easing monetary policy in September, lowering interest rates from their 6 percent peak to 5 percent by December, time deposits started to decline from their 33.61 percent high in November.  

This shift reflects a gradual return to shorter-term deposit preferences as rate-sensitive accounts adjust to a lower-yield environment.   

The third-largest category, other quasi-money deposits — including residents’ foreign currency accounts, marginal deposits for letters of credit, outstanding remittances, and bank repo transactions with the private sector — stood at SR301.28 billion, making up 10.16 percent of total deposits. Currency outside banks totaled SR233.71 billion. 

Over the past two years, the Fed’s aggressive rate hikes aimed at curbing inflation led to a rise in term deposits as customers sought higher-yielding accounts, but with benchmark rates now easing, demand deposits have started to regain share.   

Despite the 9 percent annual rise in money supply, deposit growth continues to lag behind bank lending, which surged 14.66 percent during the same period to exceed SR3 trillion for the first time. This growth has been driven by corporate credit expansion, particularly in real estate, infrastructure, and other key Vision 2030 sectors. 

As deposit inflows moderate, Saudi banks have increasingly turned to external borrowing to bridge funding gaps. Recent issuances of euro-denominated bonds highlight the evolving financing landscape, with the debt capital market playing an increasingly pivotal role. 

Speaking at the Capital Markets Forum 2025 in Riyadh in February, Mohammad Al-Faadhel, assistant deputy of financing at the Capital Market Authority, highlighted how Vision 2030 has transformed Saudi Arabia from a capital exporter to a credit-driven market, accelerating debt market growth. 

Al-Faadhel noted that the Sukuk and Development Capital Market Committee was established in collaboration with key stakeholders to remove obstacles and support market expansion.  

With ongoing structural reforms, Saudi Arabia’s financial ecosystem is evolving rapidly, setting the stage for continued growth in capital markets, corporate lending, and alternative financing mechanisms under Vision 2030.   

Loan-to-deposit ratio holds steady

Saudi Arabia’s loan-to-deposit ratio rose to 82.78 percent in January, up from 80.05 percent in the same month last year, yet slightly lower than December’s 83.24 percent, according to SAMA data. 

The LDR, a key banking metric, measures the proportion of loans issued by banks relative to their total deposits, indicating liquidity levels and lending capacity. 

The increase over the past year reflects strong credit demand, particularly from corporate borrowers in key Vision 2030 sectors such as real estate, infrastructure, and industrial expansion. 

However, the slight month-on-month decline suggests a stabilization in lending activity, as banks balance loan issuance with available deposit inflows. Despite the surge in credit, the LDR remains well below the regulatory cap of 90 percent, ensuring ample liquidity and financial stability within the banking system. 

This ratio is closely monitored by regulators and investors as it influences banks’ ability to extend new loans while maintaining a healthy funding base.  

Topics: Saudi Central Bank (SAMA) Saudi money supply

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BSF, Diriyah Co. ink $1.6bn financing deal to develop Wadi Safar project

Updated 13 March 2025
MOHAMMED AL-KINANI
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BSF, Diriyah Co. ink $1.6bn financing deal to develop Wadi Safar project

Updated 13 March 2025
MOHAMMED AL-KINANI

JEDDAH: Banque Saudi Fransi has signed a financing deal worth SR6 billion ($1.6 billion) with Diriyah Co. to develop the Wadi Safar project, highlighting the private sector’s role in driving economic growth.

The development is a key cultural and tourism destination within the larger Diriyah area, which aims to attract over 50 million visitors by 2030 while supporting major initiatives, according to the bank, which rebranded as BSF in June after 48 years in the market.

During the signing ceremony, Bader Al-Salloom, CEO of BSF, and Jerry Inzerillo, CEO of Diriyah Co., emphasized the importance of this partnership in achieving sustainable development and enhancing Diriyah’s position as a prominent cultural and historical hub.

The agreement between the two parties aligns with Saudi Vision 2030’s goal of transforming the Kingdom into a global tourist destination. The Diriyah Gate Development Authority has set a precedent by blending respect for heritage with innovative, sustainable ventures, such as Al-Bujairi Terrace, which has become a major tourist attraction since its opening in 2022.

The deal is also part of BSF’s initiatives to back significant development projects that boost infrastructure, promote tourism, and drive economic growth in Saudi Arabia, the bank said in a statement.

The Wadi Safar project, introduced in December 2023 by the DGDA, is one of the three main initiatives under the Diriyah Co’s development plan.

It covers an area of approximately 62 sq. km and is set to become an upscale residential community, including high-end hospitality facilities, recreational and sports venues, and advanced commercial and retail spaces.

The project will offer premium real estate units designed to cater to the needs of both investors and visitors. Moreover, Wadi Safar’s gated community will serve as an oasis within Riyadh, featuring three major resorts: Six Senses, Aman, and Oberoi.

It is also the location for the ongoing development of the Greg Norman-designed championship signature golf course and Royal Diriyah Golf Club.

The Diriyah development project aims to generate around 178,000 job opportunities and is expected to contribute SR18.6 billion to the Kingdom’s gross domestic product upon completion.

Topics: Banque Saudi Fransi Diriyah Co. Wadi Safar

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UAE joins dividend surge as global payouts hit record $1.75tn in 2024

Updated 13 March 2025
Nadin Hassan 
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UAE joins dividend surge as global payouts hit record $1.75tn in 2024

Updated 13 March 2025
Nadin Hassan 

RIYADH: The UAE was among 17 countries setting new dividend records in 2024 as global payouts surged to a record $1.75 trillion, marking a 6.6 percent increase from the previous year, a new report showed. 

According to research by trading platform eToro, UAE-listed companies maintained steady dividend distributions, driven by strong performances in the banking, energy, and real estate sectors.  

This comes as Saudi-listed companies also made significant dividend moves in 2024, with energy firm Aramco declaring a total payout of $85.4 billion despite a drop in net profit, while Al Rajhi Bank’s total shareholder payments reached SR10.84 billion ($2.89 billion), combining a first-half cash dividend of SR5 billion and a second-half payout of SR5.84 billion. 

“The financial sector has been a standout performer, with UAE banks benefiting from higher interest rates and economic expansion. Abu Dhabi Islamic Bank, for instance, raised its dividend payout to 50 percent of its annual profit, reflecting the sector’s robust earnings growth,” said Josh Gilbert, a market analyst at eToro. 

Energy companies also played a significant role, with ADNOC Gas announcing a $3.41 billion dividend, supported by high oil prices and a commitment to 5 percent annual dividend growth. 

In the real estate sector, Emaar Properties doubled its dividend to 8.8 billion dirhams ($2.4 billion), backed by record property sales and strong market demand.  

For income-focused investors, dividends remain a core element of long-term strategies, providing consistent cash flow and potential for compounding returns.  

“While 2024 saw record dividend distributions, certain increases, such as Emaar’s 100 percent payout of its share capital, may not be repeated annually. These sectors are cyclical, and dividends could fluctuate with market conditions,” Gilbert added. 

Despite concerns about sustainability, UAE companies’ focus on shareholder returns highlights the market’s resilience. The country’s dividend growth outlook remains positive, supported by strong corporate earnings, favorable government policies, and continued investor interest. 

Whether targeting high yields or steady income, the UAE remains an attractive market for global investors. 

Topics: UAE dividends etoro Abu Dhabi Islamic Bank

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Lebanon readies 22 deals for signing with Saudi Arabia during high-level visit

Updated 13 March 2025
MIGUEL HADCHITY 
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Lebanon readies 22 deals for signing with Saudi Arabia during high-level visit

Updated 13 March 2025
MIGUEL HADCHITY 

RIYADH: Lebanon has prepared the final drafts of 22 cooperation agreements with Saudi Arabia, setting the stage for a high-level visit next month to strengthen economic ties. 

The delegation could be led by President Joseph Aoun, Prime Minister Nawaf Salam, or both, according to Lebanese Deputy Prime Minister Tarek Mitri in an interview with Asharq. 

This comes as Saudi Crown Prince Mohammed bin Salman hosted President Aoun at the Royal Court in Al-Yamamah Palace on March 3 — Aoun’s first foreign visit since taking office — where they discussed Lebanon’s ongoing crisis and regional developments. 

The agreements, covering sectors from agriculture to intellectual property, are seen as crucial to securing broader international aid for Lebanon’s struggling economy. 

“This is a legitimate approach, and we must earn the trust of Arab nations and the international community,” Mitri said, emphasizing that Saudi Arabia’s support is vital for unlocking further international aid. He confirmed that the 22 agreements are fully drafted and ready for signing. 

On his arrival, Aoun had expressed hope that his talks with the crown prince would pave the way for a follow-up visit to sign agreements aimed at strengthening cooperation between the two nations. 

The deals cover a wide range of sectors, including intellectual property, consumer protection, and environmental management, as well as agriculture and water resources, Rabih El-Amine, chairman of the Lebanese Executives Council, told Arab News earlier this month. 

El-Amine also pointed to agreements involving the Ministry of Information, the General Directorate of Civil Aviation, and Banque du Liban. 

Mitri further revealed that Lebanon is working on an independent fund — separate from government institutions handling refugee affairs — in partnership with international organizations to oversee post-war reconstruction efforts. This move aims to boost credibility with donors, especially in the wake of the recent Hezbollah-Israeli conflict. 

A World Bank report commissioned by the Lebanese government estimates the country needs roughly $11 billion for recovery and reconstruction. The report assessed damage across 10 key sectors, projecting infrastructure repairs at $3 billion to $5 billion in public sector funding, while housing, trade, industry, and tourism would require $6 billion to $8 billion in private investments. 

Mitri also noted that France has expressed willingness to host a conference to support Lebanon’s recovery. French officials have proposed preparatory meetings or merging them into a single event, though no date has been set. The conference would prioritize humanitarian aid and reconstruction, while a separate investment-focused event aims to attract international figures. 

Topics: lebanon economy Lebanese Deputy Prime Minister Tarek Mitri Saudi-lebanon ties

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