SME

The recently convened Global Entrepreneurship Congress in Riyadh saw a slew of agreements focused on nurturing entrepreneurship in the kingdom

A total of 33 agreements were signed during the event, and several investment initiatives were launched worth more than SAR 16 billion to develop start-ups and small enterprises in the country, and across the region. The conference’s theme "Reboot, Rethink and Regenerate" echoed the transformative development taking place in Saudi’s SME sector

The Saudi Venture Investment Company (SVC) inked deals valued at SAR 2.4 billion, while SABIC launched the Nusaned Fund 2 with Al-Ahly Capital Holding worth SAR 750 million.

 Fully owned by SABIC, Nusaned Investment aims to invest in industrial SMEs and increase local content in the country’s industrial sector. It signed an investment agreement with Saudi Pallet Manufacturing Company (SPMC) to promote the local production of plastic pallets.

In addition, Cars24, an automotive e-commerce platform; Lenskart, the largest Asian optical eyewear retail chain; and Kitopi, a cloud-kitchen platform, signed memorandums of understanding (MOU) with the General Authority for Small and Medium Enterprises (Monsha’at) to support entrepreneurs in specialised fields.

 

ENCOURAGING THE ENTREPRENEURIAL SPIRIT

Monsha'at also struck a deal with Saudi Authority for Data and Artificial Intelligence to develop the Ruwad initiative, and another MOU with the Royal Commission for Jubail and Yanbu, the Saudi Industrial Development Fund, and King Abdullah University of Science and Technology to collaborate in data, artificial intelligence, and with SABIC, to boost co-operation in various initiatives for entrepreneurs and small and medium enterprises. In addition, Monsha’at signed a deal with Aljabr Finance Company to finance products for SMEs to the tune ofSAR 20 million.

Saudi Aramco also signed 10 MoUs and two agreements focused on digital transformation, information technology, and national development, while the Social Development Bank signed agreements with several entities including the Royal Commission in Yanbu and the National Entrepreneurship Institute (Riyadah), and announced the launch of several initiatives, valued at more than SAR 11 billion, to
empower entrepreneurs.

The Social Development Bank also allocated SAR 11 billion to finance entrepreneurs in the kingdom in the next three years, as part of the country’s ambition to empower the Saudi youth.

“Emanating from the importance of partnerships in advancing the development process, the bank signed, on the sidelines of the conference, several agreements with various strategic bodies, that aim to provide training, rehabilitation, and sponsorship services to the beneficiaries of male and female entrepreneurs,” according to the SPA.

“The bank was also keen to initiate effective communication with guests and visitors of the conference, and introduce its services as well as financial and non-financial programmes to them, through the bank’s pavilion in the exhibition accompanying the conference.”

 

THRIVING START-UP ECOSYSTEM

Investments in Saudi start-ups accounted for 21% of the total VC deployed in the region in 2021, up from 15% in 2020, according to a new report by SVC.

Venture capital funding deployed in Saudi Arabian start-ups grew by 270% to a record-high of SAR 2.055 billion in 2021 versus 2020, while the number of VC deals rose by 54%, year over year, to a new high of 139 deals.

“This was the result of hard work to stimulate venture investment in start-ups, and to diversify funding options for entrepreneurs for different sectors and stages, with the aim of creating financial returns to investors, and achieving strategic returns that contributes to the growth of the economy in Saudi Arabia”, according to Eng. Saleh Ibrahim Al-Rasheed, chairman of SVC.

The Saudi Central Bank (SAMA), is also fuelling the digital economy. In March, the central bank awarded Bwatech, Rabet, and Mala'a licenses to operate under its regulatory sandbox, bringing the total number of its permitted fintech companies to 35.

“This newly permitted batch of companies falls under the operational framework of the Regulatory Sandbox in line with SAMA's endeavour to digitise and improve financial services, accelerate the digital transformation of the financial sector, and understand and evaluate the impact of newly introduced technologies on the kingdom's financial services sector, all done in accordance with requirements and objectives of the Financial Sector Development Program of ‘Saudi Vision 2030’,” SAMA noted.

SAMA also announced the Open Banking Policy in 2021, which aims to build and equip an integrated system for the implementation of open banking services across the country.