Saudi startup ecosystem accounts for 60% of regional funding in September

Saudi startup ecosystem accounts for 60% of regional funding in September
Egyptian micromobility startup Rabbit Mobility closed a $1.3 million investment round led by 500 Global and Untapped Global. (Supplied)
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Updated 20 October 2024
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Saudi startup ecosystem accounts for 60% of regional funding in September

Saudi startup ecosystem accounts for 60% of regional funding in September
  • $282 million was raised across 63 startups in the region
  • The UAE ranked second with $73.8 million raised by 12 startups, while Egypt trailed, with 13 startups

CAIRO: Saudi Arabia’s startup ecosystem accounted for 60 percent of the Middle East and North Africa region’s funding in September, with $170.8 million raised across 23 deals.

According to Wamda’s monthly report, $282 million was raised across 63 startups in the region, a 234 percent increase month-on-month and a 607 percent rise year-on-year. Debt financing constituted 12 percent of the total raised.

Saudi mobility startup SHIFT led the month’s funding rounds by raising $82.8 million, followed by online car marketplace Syarah, which secured $60 million in a series C round, including $20 million in debt financing.

The UAE ranked second with $73.8 million raised by 12 startups, while Egypt trailed, with 13 startups collectively raising $25 million.

Fintech continued to dominate investor sentiment in the MENA region for the fourth consecutive month, attracting $102.5 million across 14 startups.

Mobility followed closely, driven by SHIFT’s substantial funding round. E-commerce and educational tech sectors showed strong activity, raising $63 million and $4.35 million, respectively, each with nine deals.

The software-as-a-service sector saw $10 million in investments across eight startups.

Accelerator programs had a notable impact on deal volume, with Flat6Labs’ demo days in Jordan and Saudi Arabia accounting for 17 deals valued at a combined $2 million.

Early-stage investments remained a priority for investors, who poured $102 million into 15 seed deals and $5 million into seven pre-seed startups. In contrast, only two later-stage rounds were reported, Paymob’s $22 million series B and Syarah’s series C.

Female-founded startups struggled to attract significant funding, raising only $583,000, mostly through grants.

In contrast, male-founded startups dominated the landscape, securing $260 million across 49 deals. Additionally, $21 million was raised by seven startups co-founded by both men and women.

AILA secures $1.15m for AI-powered edtech

Saudi edtech startup AILA closed a $1.15 million pre-seed round led by Sabah Hub, with participation from White Hill Capital and three other angel investors.

Established in 2023, AILA provides a generative artificial intelligence-powered platform for personalized and curriculum-aligned learning experiences.

The company plans to utilize the funds for regional expansion and technology enhancement.

Saudi Arabia’s Tawaref acquires Amaana.ai

Saudi-based investment community Tawaref acquired local AI company Amaana.ai for an undisclosed amount.

Founded in 2020 by Saeed Al-Ansari, Tawaref supports startups in the region with investments and entrepreneurial services, while Amaana.ai automates business entry processes into Saudi Arabia.

The acquisition aims to enhance Tawaref’s capabilities in providing innovative financial and technological solutions.

“The integration of Amaana.ai allows us to elevate our service offerings and reinforce our mission to support startups with advanced, AI-driven solutions. By blending our expertise, we’re providing smarter and more efficient solutions that will help our clients navigate the Saudi market with ease,” said Al-Ansari.

UMX raises $4.5m for global gaming growth

Saudi game studio UMX raised $4.5 million from Jetapult, an investment company backed by Accel Partners.

Founded in 2014, UMX specializes in developing mobile car games. The new capital will be used to expand UMX’s game portfolio and reach new audiences globally.

“This significant investment from Jetapult not only marks a milestone for UMX Studio but also heralds a new era for the Saudi Arabian gaming industry. We are thrilled to partner with a globally recognized leader in the gaming investment space,” said Ali Al-Harbi, founder of UMX.

JARAS Hospitality closes $666k pre-seed

JARAS Hospitality, a Saudi startup focused on integrated hospitality management solutions, secured $666,000 in a pre-seed round led by undisclosed angel investors.

The company, founded in 2023, plans to use the investment to further develop its product and expand its customer base.

“We are thrilled to have closed this investment round, which provides strong support for our vision to deliver innovative solutions that contribute to improving the hospitality sector. The investment will give us the opportunity to accelerate our growth and expand our market presence,” CEO Ahmed Al-Zubaidi said.

SVC invests $15m in Vision Ventures’ Saqr Fund II

Saudi Venture Capital committed $15 million to Vision Ventures’ Saqr Fund II, a $90 million-target venture capital fund that will focus on early-stage startups across Saudi Arabia and the broader MENA region.

Vision Ventures, founded in 2016, is a sector-agnostic firm investing in early-stage tech startups.

WellPal relocates to Saudi Arabia after new funding

Egyptian health e-commerce platform WellPal relocated its operations to Saudi Arabia following an undisclosed investment from an angel investor.

Founded in 2019 by Mohamed Ali and Mohamed Tantawy, WellPal, a Flat6Labs portfolio company, offers health products for fitness and wellness through its app.

The company aims to strengthen its position in the Saudi market and expand regionally.

“We are proud to support the Saudi Vision 2030, particularly in enhancing the quality of life for its citizens. Through WellPal’s AI-powered features, we look forward to providing tailored health and lifestyle products that can help our customers make smarter and healthier choices,” Ali, the firm’s CEO, said.

Rabbit Mobility raises $1.3m to fuel North African expansion

Egyptian micromobility startup Rabbit Mobility closed a $1.3 million investment round led by 500 Global and Untapped Global.

The funds will support the company’s growth and expansion across Egypt and other North African markets.

Rabbit Mobility was founded in 2020 by Kamal El-Soueni, Mohamed Mansoury and Bassem Magued and provides a fleet of electric scooters for urban mobility.

Morocco’s Agenz secures funding from Renew Capital

Morocco-based property tech startup Agenz received an undisclosed investment from Renew Capital.

Founded in 2020 Malik Belkeziz, Agenz offers instant property valuations using advanced data intelligence.

“Our platform helps people make smarter decisions by providing accurate data on property values and market trends,” said Belkeziz.

The funds will help the company expand its reach in Morocco and other African markets.

Moonbase Capital launches $15m investment fund

Spain-based Moonbase Capital launched its second investment vehicle, a $15 million fund aimed at acquiring and growing small to medium-sized enterprises worldwide.

The fund will target emerging markets, including Latin America, Southeast Asia, and the Middle East, with a focus on investing in 15 SMEs over the next three to four years.

The first close is expected in the first quarter of next year, with capital sourced from family offices and high-net-worth individuals in Europe, Egypt, and the Gulf Cooperation Council.

Abhi raises $15m debt financing round

UAE-based fintech Abhi has raised $15 million in debt financing in a round led by Shorooq Partners and Amplify Growth Partnership.

Established in Pakistan in 2021 by Ali Ladhubhai and Omair Ansari, Abhi focuses on improving financial inclusion for employees and SMEs across the MENA and Pakistan region.

The new funding will support Abhi’s expansion efforts, enabling it to scale its operations and broaden access to earned wage access services for both blue- and white-collar workers in the region.


AI will help Saudi Arabia achieve ambitious growth targets: expert

AI will help Saudi Arabia achieve ambitious growth targets: expert
Updated 12 sec ago
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AI will help Saudi Arabia achieve ambitious growth targets: expert

AI will help Saudi Arabia achieve ambitious growth targets: expert

RIYADH: Artificial intelligence will help Saudi Arabia to achieve its ambitious goals for growth, while reducing its reliance on other targets, according to a top executive.

Jad Haddad, partner and global head of consultancy Oliver Wyman’s AI division Quotient, spoke to Arab News recently about how technological advances are reshaping the workforce.

“Today, there is a shortage of labor, particularly in Saudi Arabia,” he said. “If the Kingdom’s going to reach its very ambitious targets of growth, in a way AI and the embracement of AI will basically help achieving those very aggressive, but also achievable, as we’ve seen, targets, with less dependency on others.”

Saudi workplaces are already well advanced in using generative AI tools, such as text generator Chat GPT, with 68 percent of employees surveyed by Oliver Wyman making use of the technology compared with a global average of 55 percent.

Haddad noted how another survey found that more than 90 percent of CEOs at New York Stock Exchange-listed companies also invest heavily in AI and believe in its promise. “But yet we haven’t seen a lot of disruption to jobs.”

He added: “Will we see disruption in the job market? Probably. I think AI already is augmenting a lot of the things that we do, and as we have applications that are implemented and scaled within organizations, things are going to change.

“But at the same time, we can look at it from the other way around. I think it is already creating a lot of jobs as well.”

The forward-looking Gulf is a leader in the adoption of AI technologies, according Haddad, who highlighted the fact that some of the region’s biggest companies are employing the technology.

National oil companies such as Aramco and ADNOC “are really taking up AI, and that’s also great because they are a big part of the society but also of the economy,” he said.

“I think the region is really embracing AI, much faster than any other region, and is really seeing the benefit and the promise of AI.”

Saudi Arabia’s early focus on the new technology was evidenced when the Kingdom founded its government AI agency SDAIA in 2019.

The entity employs around 3,000 people, and is focused on establishing governance related to AI, and positioning the country as a leader in the field.

A November report from SDAIA highlighted Saudi Arabia’s global leadership in AI, as evidenced by its top ranking in the pillar of government strategy in the 2023 Global AI Index by Tortoise Media.

In 2023, the Kingdom joined the UN AI Advisory Body, aiming to promote the responsible use of AI.

Government spending on technologies, including AI, grew at a compound annual growth rate of 59 percent between 2019 and 2023, according to the Saudi Press Agency.

In September 2024, at the third edition of SDAIA’s Global AI Summit, the authority unveiled the AI Adoption Framework Document, providing a guiding reference for adopting AI in the public and private sectors.

SDAIA also recently announced the activation of AI offices in 23 government entities.


Egypt’s non-oil private sector shrinks more slowly in November, PMI shows

Egypt’s non-oil private sector shrinks more slowly in November, PMI shows
Updated 03 December 2024
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Egypt’s non-oil private sector shrinks more slowly in November, PMI shows

Egypt’s non-oil private sector shrinks more slowly in November, PMI shows

CAIRO: Conditions in Egypt’s non-oil private sector declined more slowly in November as output and new orders dropped at a slower pace, according to the latest Purchasing Managers’ Index (PMI) data from S&P Global.

The PMI edged up to 49.2 in November from 49 in October, inching closer to the 50 threshold that separates growth from contraction. Despite the improvement, the index still indicated a marginal downturn in business conditions.

“Declines in output and new business slowed across the non-oil sector in November, indicating that business conditions are close to stabilising,” said S&P economist David Owen.

Output levels fell for the third consecutive month, attributed to persistently weak customer demand. However, some firms reported a pick-up in new work, hinting at signs of recovery.

The output sub-index improved to 49.1 from 47.9 in October, while the new orders sub-index climbed to 48.7 from 47.6.

The manufacturing sector showed modest growth in goods orders, which helped offset declines in construction, wholesale & retail, and services.

Employment numbers decreased in November, their first reduction after four months of expansion. Companies cited reduced sales volumes and weaker confidence as reasons for not replacing voluntary leavers.

Input prices, at 55.9, rose at the slowest pace since July, with lower wage growth contributing to a four-month low in cost inflation. However, purchase prices continued to climb, partly due to a stronger US dollar.

Firms remained cautious about future business activity. Output expectations for the year ahead, at 50.5, was the second-lowest the series’ history.


Oil Updates – prices nudge higher ahead of OPEC+ meeting

Oil Updates – prices nudge higher ahead of OPEC+ meeting
Updated 03 December 2024
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Oil Updates – prices nudge higher ahead of OPEC+ meeting

Oil Updates – prices nudge higher ahead of OPEC+ meeting

SINGAPORE: Oil prices nudged higher on Tuesday but remained within a narrow trading range, as traders awaited the outcome of an OPEC+ meeting later this week.

Brent crude futures rose 31 cents, or 0.4 percent, to $72.14 a barrel by 10:04 a.m. Saudi time, after dropping 1 cent in the previous session. US West Texas Intermediate crude climbed 26 cents, or 0.4 percent, to $68.36, following a 10 cent gain on Monday.

Sources from the producer group said it will extend its latest round of output cuts until the end of the first quarter at its Dec. 5 meeting.

“Given a rise in compliance with production cuts from Russia, Kazakhstan, and Iraq, the lower Brent price level, and indications in press reports, we assume an extension of OPEC+ production cuts till April,” Goldman Sachs analysts said in a note.

OPEC+, which includes the Organization of the Petroleum Exporting Countries and allies such as Russia, has been looking to unwind production cuts by the first quarter of 2025. However, the outlook for surplus supply has put pressure on prices. The group accounts for about half of the world’s oil production.

“I think there’s no other option but to defer it,” Priyanka Sachdeva, a senior market analyst at Phillip Nova said, adding that it could only be for just a month or so as there is a lot of pressure from participating nations to ramp up output.

Amid a lack of bullish catalysts and lacklustre demand, Sachdeva expects oil prices to trade in a limited range with a bias toward the downside.

The consumption outlook remains weak with China’s crude imports expected to peak as soon as next year as transport fuel demand begins to decline for the world’s top crude buyer, researchers and analysts said, further exacerbating the gap between demand and supply.

Concerns that the US Federal Reserve may not cut rates at its December meeting have also capped oil prices, offsetting positive signals from China, where the purchasing managers’ index rose to a seven-month high in November.

Oil prices on both sides of the Atlantic fell more than 3 percent last week.

Federal Reserve Governor Christopher Waller, whose views are often a bellwether for US monetary policy, said he was inclined to support another rate cut this month, but Atlanta Federal Reserve President Raphael Bostic maintained that the Fed still needed to consider upcoming jobs data.

In the Middle East, holes continued to appear in a US-brokered ceasefire between Israel and militant group Hezbollah, with nine people killed in strikes on two southern Lebanese towns shortly after Hezbollah fired missiles on an Israeli military position in the disputed Shebaa Farms area on Monday.

US crude oil stockpiles are expected to have fallen last week while gasoline and distillate inventories likely rose, a preliminary Reuters poll showed on Monday. The American Petroleum Institute and Energy Information Administration will release weekly data on Tuesday and Wednesday, respectively.


Saudi PMI hits 59 in November as non-oil sector grows 

Saudi PMI hits 59 in November as non-oil sector grows 
Updated 03 December 2024
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Saudi PMI hits 59 in November as non-oil sector grows 

Saudi PMI hits 59 in November as non-oil sector grows 
  • Business activity saw its sharpest rise in 16 months, with firms linking the surge to stronger demand, higher customer volumes, and successful marketing campaigns
  • Employment growth also surged, with companies expanding their workforce at the second-fastest pace in over a decade, driven by the need to manage rising workloads

RIYADH: Saudi Arabia’s non-oil private sector ended November with robust momentum, as business activity expanded at its fastest pace since July 2023, latest business survey showed. 

The Riyad Bank Saudi Arabia Purchasing Managers’ Index rose to 59.0 in November from 56.9 in October, marking the fourth consecutive monthly increase, buoyed by accelerated growth in new orders, purchasing activity, and staff recruitment.  

The headline PMI — calculated as a weighted average of sub-indices covering new orders, output, employment, supplier delivery times, and stock levels — reflected a substantial improvement in operating conditions, with all five components contributing to the uptick. 

Naif Al-Ghaith, chief economist at Riyad Bank, said: “The strong growth in Saudi Arabia’s non-oil private sector helped the PMI to reach 59.0 in November, demonstrating the continued success of economic diversification efforts.”  

He added: “This robust expansion, marked by accelerated output and demand, reflects the increasing capacity of non-oil sectors to contribute to economic activity independently of oil price fluctuations.” 

Business activity saw its sharpest rise in 16 months, with firms linking the surge to stronger demand, higher customer volumes, and successful marketing campaigns. New order inflows, including foreign sales, rebounded after a modest pullback in the previous survey period. 

Employment growth also surged, with companies expanding their workforce at the second-fastest pace in over a decade, driven by the need to manage rising workloads. 

“Employment growth indicates a rising capacity of non-oil sectors to absorb labour, further supporting socioeconomic objectives like increasing national employment,” Al-Ghaith noted. 

Firms ramped up input purchases at the strongest rate since March to build inventories in anticipation of higher sales. However, this strained supply chains, resulting in the slowest improvement in vendor performance in 15 months. 

Inflationary pressures  

The report noted that the sector’s rapid expansion brought inflationary pressures to the forefront. Input costs rose at the sharpest pace in over four years, driven by higher wages, geopolitical tensions, and increased transport costs. Wage inflation hit a ten-year high, while firms raised their selling prices at the fastest rate since January to offset these pressures. 

“Stronger purchasing activity and inventory expansion suggest businesses are gearing up for continued growth in demand,” Al-Ghaith said.  

“This performance aligns with broader economic trends showing Saudi Arabia’s ability to attract foreign investments, boost consumer confidence, and enhance trade partnerships,” he added. 

The strong November PMI underscores the resilience of Saudi Arabia’s non-oil economy despite global uncertainties. Companies remain optimistic about future growth, supported by government initiatives to diversify the economy under Vision 2030. 

“Maintaining this momentum will be essential to achieving Vision 2030 goals and ensuring long-term economic growth,” Al-Ghaith concluded.


Saudi Arabia to strengthen healthcare through partnership with China’s BGI Group

Saudi Arabia to strengthen healthcare through partnership with China’s BGI Group
Updated 02 December 2024
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Saudi Arabia to strengthen healthcare through partnership with China’s BGI Group

Saudi Arabia to strengthen healthcare through partnership with China’s BGI Group

JEDDAH: Saudi Arabia is poised to bolster its healthcare system through a strategic new partnership with China’s BGI Group. The collaboration will focus on localizing medical services, improving supply chains, and advancing preventive care to better serve the Kingdom’s population.

On Dec. 2, the Public Investment Fund’s fully owned National Unified Procurement Co. signed a memorandum of understanding with Shenzhen-based BGI Group. The partnership is aimed at enhancing healthcare cooperation and leveraging BGI’s cutting-edge expertise to support Saudi Arabia in delivering comprehensive, high-quality healthcare services to its citizens.

The signing ceremony, held in China, was attended by Saudi Minister of Health Fahad bin Abdulrahman Al-Jalajel, who is on an official visit to the country.

The agreement aligns with the goals of Saudi Arabia’s Healthcare Sector Transformation Program, which aims to modernize and integrate the Kingdom’s medical system.

The transformation effort prioritizes innovation, financial sustainability, and disease prevention, while expanding access to healthcare, enhancing e-health services, and improving care quality in line with international standards.

As part of the MoU, Nupco and BGI will explore opportunities for direct collaboration in developing integrated logistics services for biological samples. This will help strengthen the infrastructure of Saudi Arabia’s healthcare sector.

Al-Jalajel emphasized that Saudi Arabia is emerging as a global hub for digital health and innovation, with the partnership with BGI underscoring the Kingdom’s commitment to addressing global health challenges.

The minister’s visit to China is part of broader efforts to deepen health cooperation and reinforce Saudi Arabia’s position as a global center for health innovation — aligning with both the Health Transformation Program and Vision 2030.

This MoU follows a visit in November by a Nupco delegation to BGI Genomics. During the visit, the group, including Nupco CEO Fahad Al-Shebel, was introduced to BGI Genomics’ innovative technologies in proactive disease prevention, multi-omics research, and smart laboratory solutions. BGI’s leadership, including CEO Yin Ye and CEO of BGI Genomics Zhao Lijian, welcomed the delegation, marking a significant milestone in the two organizations’ growing collaboration.

The visit also reinforced the ongoing strategic partnership between the two companies, which began with efforts to combat the COVID-19 pandemic.

During discussions, both sides expressed a shared commitment to expanding cooperation in areas like genetic testing, laboratory expansion, and medical sample transportation — all aimed at advancing life sciences.

BGI highlighted that both parties agreed to enhance localized genetic testing services in Saudi Arabia, contribute to the Kingdom’s public health and precision medicine initiatives, and make significant contributions to improving public health outcomes.

This partnership marks a key step in the Kingdom's healthcare transformation journey, reinforcing its vision to provide world-class medical services while advancing technological innovation in the sector.