KSA: The Next Frontier (Issue Number 4)

Insight & Inspiration for Investors, Sports Enthusiasts, Travelers, the Curious & More.

Letter from the publisher

Dear Readers,

I want to begin our latest issue of KSA: The Next Frontier with continued thanks for your support and enthusiastic responses to our first few issues. 

In this edition, we delve into the rise of Saudi entrepreneurship and the institutions taking innovation to the next level, the sponsorships helping bring top-notch soccer talent to the Kingdom, and the powerful symbolism of the camel – and more. 

We hope you’ll explore the links to the stories that interest you most, whether you’re a future investor, a soon-to-be-tourist, or simply a curious reader. Saudi Arabia is on an exciting path forward, and we're thrilled to share that journey with you, story by story. Please engage with us – tell us what you like and what you want to see more of – and share this newsletter to help us bring more content on the dizzying developments in Saudi Arabia to a wider audience.

Warm regards,

Publisher, KSA: The Next Frontier

Upskilling for Upscaling

Workforce development continues to form the backbone of Saudi economic growth under Vision 2030. Nowhere is that more evident than in Diriyah, the City of Earth, where investments in infrastructure, tourism, and recreational facilities are outpaced only by investments in the most precious capital of all – human capital.  

Achieving workforce development goals took a leap forward earlier this year, when the Diriyah Company and the Royal Institution of Chartered Surveyors (RICS) signed a Memorandum of Understanding (MoU) to provide specialized training for Saudi professionals, empowering local talent and enhancing the workforce’s skills. The partnership, signed in June 2024, aims to train 15 Saudi employees annually from Diriyah Company, with the potential to expand based on future demands. The initiative is designed to foster the development of young Saudi talent through the UK-based multinational professional body, offering promising young Saudis a pathway to chartership, a globally recognized certification in understanding and developing the built environment – that is, the physical spaces and systems where people create live, work, and play.

This strategic collaboration is focused on the transfer of knowledge and expertise, ensuring that Diriyah employees, from junior staff to mid-management, gain critical skills in fields such as Cost and Commercial Management, Project Management, Real Estate Advisory, Asset and Facilities Management, and Procurement. The training program will be conducted primarily in Riyadh through a combination of webinars and in-person sessions, minimizing disruption to mentees’ employment and regular business operations. Partner organizations will also have the opportunity for international training, depending on organizational needs.

The MoU also includes plans for training related to building conservation and achieving sustainability goals, particularly important given Diriyah’s focus, in line with Vision 2030, on preserving historic sites and Saudi Arabia’s pristine landscapes and resources. Trainees will be guided through the process of gaining RICS membership, with detailed development plans and continuous support throughout their career progression. 

The partnership reflects Diriyah Company’s commitment to investing in its workforce and contributing to the Kingdom's Vision 2030 goals, specifically the emphasis on developing local talent and promoting sustainability. By partnering with RICS, Diriyah Company aims to elevate its team’s expertise, ensuring its professionals are globally competitive and equipped to manage the historic Diriyah development effectively and responsibly.

Saudi Startups Spreading Their Wings

Saudi Arabia’s early interventions in the tech industry in recent years include large scale investments in international brands such as Uber, Alibaba and Lucid Motors, many through the Public Investment Fund’s (PIF) high profile partnership with SoftBank. The Kingdom and its investors will still pay close attention to such household corporate and investment names, especially those converging at the FII (Future Investment Initiative) summit at the end of October in Riyadh. 

But there are growing signs of an entirely different model starting to emerge: small-scale homegrown startups expanding to and partnering with international tech ecosystems. A significant signal came recently with the massive Saudi presence at the Startup20 summit in Sao Paulo, Brazil. As a recent G20 host itself, the Kingdom takes these forums seriously and Startup20 was clearly no exception.

The Saudi Startup20 delegation was sponsored by NEOM and organized by entrepreneurship organization e-Vision, led by HRH Prince Fahad bin Mansoor AlSaud. Alongside him was NEOM’s Head of Innovation, The Hon. Wyatt Roy, a former Australian parliamentarian and Assistant Minister for Innovation, who joined the project earlier this year with an initial focus on creating a startup ecosystem.

The delegation included 50 key members of the Saudi innovation industry including many of the most promising domestic startups, as well as all relevant government ministries and agencies.  Many key players in Brazil’s local industry, including several provincial governors, engaged with the Saudi workshops and events, culminating in a VIP gala dinner which appealed to the Kingdom’s & Brazil’s mutual love of soccer, featuring guest appearances from star footballers Ronaldo and Cafu.

A handful of promising Saudi startups and accelerators stood out. A machine learning platform that turns underutilized data into actionable intelligence, nybl’s top three executives attended the summit, where they found themselves finalizing an investment from a Brazilian fund and exploring a potential partnership with a Brazilian tech startup for data integration. They also merged earlier this year with another Saudi company, the data and automation specialists Basserah.

Blossom is a fast-growing startup accelerator led by the charismatic Emon Shakoor that nurtures promising technology startups, especially those led by women. Blossom recently announced a partnership with Mastercard Saudi, and while in Brazil signed a partnership to foster the soft landing of Brazilian companies into Saudi and vice-versa. 

Unifonic is a cloud communications platform that provides innovative solutions for businesses to communicate with customers. Based in Riyadh, Unifonic has attracted both significant global brands, and significant investment - including a $125 million Series B round, making it a standout in the Middle East's tech ecosystem.

Falak Investment Hub was founded and is led by Adwa Aldakheel, one of a growing number of female investors in the GCC. Falak Investments Hub is helping to develop the ecosystem through initiatives such as Falak Angels for investors to identify syndicate opportunities, Falak Products to host ventures, and Falak Spaces for community building. 

As the Summit brought into focus, a trend that will remain of special interest is whether Riyadh’s fast-growing FinTech industry, as showcased at the latest FinTech24 conference (hosted in Riyadh), will find collaborative opportunities in Latin and South America. Sao Paulo is the preeminent tech hub of Latin America, with an especially impressive FinTech industry that has led many innovations in banking services. There are already indications that this is just the beginning: In June PIF pledged $15 billion of investment in Brazil, focusing on strategic technologies like green hydrogen and renewable energy. 

Moonshots and Monshaat

Saudi Arabia’s entrepreneurship and innovation sector is evolving fast, driven by the ambitious Vision 2030. The country's focus is on diversifying its economy, reducing reliance on oil, and fostering a dynamic private sector. Key targets under Vision 2030 include increasing the GDP contribution of small- and medium-sized enterprises (SMEs) from 20% to 35%, increasing the private sector’s share of GDP from 40% to 65%, and boosting the share of non-oil exports from 16% to 50%. Other goals include raising SME lending share to 20%, attracting more foreign direct investment (FDI), lowering unemployment to 7%, and increasing female workforce participation from 22% to 30%. Entrepreneurship and innovation are seen as especially critical to achieving these goals because they have the greatest potential to drive ambitious growth, diversify economic activity, and create workplaces where a vibrant reinvigorated Saudi culture can thrive.

A key emphasis in Saudi Arabia’s innovation sector is the development of disruptive technologies such as the metaverse, machine learning, biotechnology, and agritech. These cutting-edge industries are seen as moonshots for future economic growth and a means to enhance productivity across sectors. They contain multiplier effects. For example, agritech is vital to the kingdom’s food security goals, while biotech could launch Saudi Arabia towards being a global leader across healthcare and pharmaceuticals development. The metaverse and AI-related industries align with the country’s digital transformation efforts, laying the foundation for a knowledge-based economy.

Supporting entrepreneurs is a wide network of venture capital firms, government entities, and non-governmental organizations (NGOs). Monshaat, the Small and Medium Enterprises General Authority, provides various programs to foster SME growth, while Saudi Venture Capital (SVC) offers capital to high-potential startups. Additionally, the Public Investment Fund (PIF) has committed significant resources to invest in innovative startups, and entities like Saudi Aramco’s Wa’ed initiative offer direct support to tech-focused entrepreneurs.

Several upstart companies in Saudi Arabia have raised significant capital and made headlines with their success. Food delivery platform Jahez completed a $427 million IPO, while cloud kitchen startup Kitopi raised over $400 million in funding. M&A exits have also increased, with companies like Careem (acquired by Uber) showcasing the potential of the startup ecosystem.

Saudi Arabia has been active in welcoming investors from around the world across all Vision 2030 sectors, with a focus on fostering innovation. In particular, the Saudi Ministry of Investment has designed an entrepreneurship license program to provide international startups with a streamlined path to establish operations in the Kingdom. This fully digital process comes with several important benefits, including eligibility to apply for local funding and access to regional networks of investors and talent development, all of which facilitates access to a burgeoning market and significant investment opportunities.

City of Earth Cup

Before the decade has even reached halftime, Saudi Arabia has been rapidly advancing toward its Vision 2030 goals of becoming a global hub for sports and recreation. By investing heavily in world-class sporting events and infrastructure, the Kingdom is positioning itself as a premier destination for international sports. From hosting Formula E to international boxing matches, Saudi Arabia’s commitment to enhancing its sports and entertainment sectors is clear. These efforts not only promote active lifestyles and community engagement but also attract global attention, driving international investment and a diversified economy.

The Saudi Super Cup, now renamed the Diriyah Saudi Super Cup, is a key part of these ambitions. The tournament, first held in 2013, has quickly become one of Saudi Arabia’s most prestigious soccer events. The 2024 edition took place in the Prince Sultan bin Abdulaziz Sports City in Abha from August 13 to 17, featuring four top teams: Al Hilal, Al Nassr, Al Ahly, and Al Taawoun. These clubs represent the best of Saudi football, with star players such as Cristiano Ronaldo (Al Nassr), who scored two goals in the tournament and Aleksandar Mitrović (Al Hilal), who scored three en route to being named Best Player. The tournament has grown in stature, drawing tens of thousands of fans in attendance, and becoming a showcase for the Kingdom’s top footballing talent and attracting fans from around the world.

The tournament’s commercial success is driven by the exclusive partnership between Saudi Media Company (SMC) and Diriyah Company. SMC, the commercial partner, has played a pivotal role in promoting the event both locally and internationally. Together, Diriyah and SMC have worked to ensure that the Super Cup is a major success, using advanced marketing strategies to elevate the tournament’s profile. Their collaboration has ensured high visibility for the event, boosting its reputation as one of the region’s top sporting competitions.

These sponsorships also serve a broader purpose, promoting Saudi Arabia’s rich cultural, heritage, and tourism destinations. As part of Vision 2030, institutions like Diriyah Company are strategically investing in the sports sector to boost tourism, attract foreign investors, and position the Kingdom as a key player in the global sports industry.

Unicorns in the Desert

Saudi Arabia is emerging as a dynamic hub for entrepreneurship, fueled by the Vision 2030 initiative, which aims to diversify the economy and reduce its dependence on oil. The ecosystem is thriving, as startups in Saudi Arabia raised a record-breaking $1.38 billion in capital in 2023. That success is no coincidence. Key organizations, including the Saudi Venture Capital Company (SVC) and Jada, are providing critical funding and support to startups, and forming the solid foundation for a startup sector to flourish.

SVC is a government-backed entity that provides funding to venture capital and private equity firms, which, in turn, invest in Saudi startups. SVC addresses the need for early-stage funding by boosting access to capital for innovative, high-growth startups. It has helped catalyze investments in sectors like fintech, e-commerce, and health tech. One of its notable successes includes backing venture funds that invested in Tamara, a Saudi fintech company offering buy-now-pay-later services, which raised significant rounds of capital and cemented its place as the first Saudi fintech “unicorn” – valued at $1 billion or more.

Jada, a “fund of funds,” plays a complementary role by injecting capital into private equity and venture capital firms. It was established to close the funding gap for startups and small and medium-sized enterprises (SMEs), encouraging more private sector investment. It has since supported more than 500 SMEs, trained more than 450 investment professionals, deployed over a billion Riyals (about $300 million) in capital funding, and created more than 12,000 jobs in Saudi Arabia. By offering long-term commitments for fledgling businesses, Jada has supported numerous funds that have driven successful investments in Saudi startups, especially in the healthcare sector. 

In addition to venture capital, Saudi Arabia offers robust loan programs. The National Technology Development Program (NTDP), in collaboration with the Kafalah Program, provides loans designed to meet the unique needs of tech startups. These loans guarantee capital for early-stage companies, ensuring that even those with limited collateral can access much-needed financing. One success story is Nana Direct, a grocery delivery app, which benefited from the NTDP loan program and scaled rapidly to become a major player in the online grocery sector in Saudi Arabia.

The Saudi Ministry of Communication and Information Technology (MCIT) has been a driving force behind fostering entrepreneurship. Through its Center of Digital Entrepreneurship (CODE), MCIT offers mentorship, incubators, and accelerators to tech startups. CODE has played a pivotal role in nurturing a culture of innovation, helping entrepreneurs navigate the early challenges of business development and gain access to funding opportunities with hands-on support from mentors in technical fields.

An influx of foreign investment in Saudi Arabia’s startup sector is already underway, and widely attributed to the Kingdom’s booming collaborative entrepreneurial ecosystem, favorable regulatory changes including an expedited immigration and visa process for foreign innovators, and a population eager for innovation and on the hunt for growth opportunities. With robust support from the public and private sectors and a national appetite for quantum quality-of-life improvements, the Kingdom is becoming a magnet for foreign capital looking for the next unicorn in the desert.

Renew Under the Sun

Where the most plentiful natural resource may be sunshine, it’s no surprise that renewable energy presents the possibility of a brighter future. Saudi Arabia is blazing a trail in renewables, embarking on several ambitious gigaprojects to transform its energy sector, focusing on renewable and clean electricity production. These initiatives are key components of the Saudi Green Initiative (SGI) and the National Renewable Energy Program (NREP), two cornerstone projects designed to align with HRH Crown Prince Mohammed Bin Salman’s Vision 2030 and its twin goals of combatting climate change while creating more abundant and affordable energy. The aim is to reduce the Kingdom’s reliance on fossil fuels, diversify and localize the energy supply, and position Saudi Arabia as a global leader in renewables technology and production. Saudi entrepreneurs and foreign investors are pursuing these ambitious goals through substantial investments in solar, wind, and green hydrogen projects, showcasing the nation’s commitment to growth that enhances – rather than detracting from -- environmental sustainability.

The Public Investment Fund (PIF) plays a critical role in driving investments into these green initiatives. As Saudi Arabia’s sovereign wealth fund, PIF directs capital into projects that align with national goals of sustainability and economic diversification. Through SGI, the fund supports afforestation, carbon reduction, and clean energy infrastructure, positioning Saudi Arabia at the forefront of global environmental efforts. In parallel, the Ministry of Energy’s NREP aims to increase the share of renewable energy in the country’s electricity-generation mix, targeting 50% clean energy by 2030. NREP facilitates large-scale renewable projects, inviting both domestic and foreign investment to meet these ambitious targets.

One of the major goals of these gigaprojects is to achieve 27.3 gigawatts (GW) of renewable energy capacity by 2024 and 58.7 GW by 2030. To this end, projects such as the $5 billion NEOM Green Hydrogen Project (led by the joint venture of the same name) and the Sakaka solar power plant will be crucial. The NEOM project is set to become the largest green hydrogen plant globally, while Sakaka represents a huge leap towards the productive use of photovoltaic technology to generate electricity using the sun’s rays. Wind farms like Dumat Al Jandal, which is the largest in the Middle East at an installed capacity of 400 megawatts, are also part of Saudi’s clean energy landscape, further reducing carbon emissions.

Strategic partnerships with local companies such as Ma’aden mining and ACWA Power, along with the localization of renewable energy technologies, ensure that Saudi Arabia will not only meets its energy needs but create jobs and foster technological development in the process. And, as PIF’s guidelines emphasize, sustainability is embedded in these projects through efforts to minimize environmental impact, ensure resource efficiency, and establish sources of power for a booming economy that can keep up with the rapid pace of growth without sacrificing efficiency and cleanliness.

Not Over the Hump

After years celebrating calligraphy, coffee, and poetry – all tapping into Saudi Arabia’s roots as a civilizational center – 2024 marks the Year of the Camel, dedicated to the great mammal’s symbolic power and profound connection to the people of the Arabian Peninsula. 

The Saudi Ministry of Culture’s Year of the Camel initiative celebrates the deep historical and cultural significance of the camel in Arabian life. For centuries, camels have been an integral part of Arabian culture, symbolizing resilience, loyalty, and endurance in the harsh desert climate. Known as the “ship of the desert,” camels have long provided transportation, nourishment, and companionship for Arabian tribes, enabling them to traverse vast desert expanses. Camels have thus become a powerful symbol of Arabian identity, representing the virtues Saudi culture holds dear and a deep connection to the land.

As part of Vision 2030, the Ministry of Culture has aimed to solidify the camel’s standing as an authentic cultural legacy and boost its global presence – coinciding with the United Nations designating 2024 the International Year of Camelids. The camel is seen not just as an emblem of Saudi Arabia’s heritage, but also as a core component in building civilizations. Through this initiative, the Ministry seeks to showcase the camel's historical significance and its role in the development of Arabian societies, from ancient trade routes to its continued importance in today’s culture, to reconnect Saudis with their heritage while sharing this rich legacy with the world.

Throughout the year, the Ministry partnered with various organizations to celebrate the camel through events, activities, and initiatives, drawing attention to its cultural value. These celebrations aligned with Vision 2030 by boosting tourism, recreation, and pride in Saudi heritage. 

The AlUla Camel Cup took place in late April, featuring top racing camels from the region and a $6.4 million prize for winners. Mazayen al-Ibl (“the beautiful camels”) is an annual camel beauty pageant held in Rumah. Also known as the King Abdel Aziz Festival, this event is put on by the Qahtani tribe, and this year featured approximately 1,400 camel owners from various Gulf states, receiving extra promotion and attention this year as part of the yearlong festivities. In Al-Jawf, moreover, visitors have been treated to showings of 2,000-year-old, life-size camel carvings on desert rocks. Across the Kingdom, Camel-inspired activities showcased how camels impact Saudi lifestyle through the arts, fashion, cuisine, and sustainability practices. And then there is Alheda’a: visitors can experience this special oral tradition used by camel herders to communicate with their flocks.

Not only has the Year of the Camel honored the camel’s role in Saudi history, but it has also contributed to the development of the camel sector, increasing its role in economic growth and tourism, further cementing the camel’s place in the Kingdom’s future.

Publisher: Jason Greenblatt Productions LLC