Kholoud Hussein

For decades, the Saudi economy was defined by scale. Large oil companies, government spending and mega-projects shaped the Kingdom’s economic landscape, while small and medium-sized enterprises remained an important but comparatively secondary component of the private sector.

That equation is changing.

Across Riyadh, Jeddah, Dammam and the Kingdom’s emerging economic centers, a new generation of entrepreneurs is building businesses that are increasingly embedded in the infrastructure of the Saudi economy. They are developing payment systems, digitizing commerce, creating logistics networks, transforming healthcare delivery, developing artificial-intelligence applications, supporting tourism and entertainment, and providing technology to businesses that previously had limited access to sophisticated digital services.

The significance of this transformation goes well beyond the number of startups being created. Saudi Arabia is gradually building an entrepreneurial economy in which SMEs are becoming employers, technology providers, suppliers, exporters and, increasingly, investment assets in their own right.

By the end of the third quarter of 2025, the Kingdom had 1.7 million commercial registrations, while SMEs employed more than 8.4 million people, according to Monsha’at. The scale of the business base is particularly notable when compared with the roughly 429,000 SMEs recorded in 2016, according to data cited in a 2026 Saudi British Bank analysis of the National Transformation Program.

At the same time, Saudi Arabia has emerged as the Middle East and North Africa’s leading venture-capital market. Saudi startups attracted a record $1.72 billion across 257 transactions in 2025, marking a 145% increase in funding from the previous year and the highest level ever recorded for a single MENA market, according to MAGNiTT data sponsored by Saudi Venture Capital Company (SVC).

Those numbers point to a profound shift: the Kingdom is no longer simply trying to encourage people to establish businesses. It is attempting to create companies capable of scaling, attracting institutional capital, generating employment, solving structural economic gaps and eventually becoming major economic actors.

From Vision 2030 beneficiaries to economic contributors

The transformation of the SME sector has been embedded in Saudi Arabia’s economic strategy from the beginning of Vision 2030.

Monsha’at, established in 2016 to regulate, support and develop the SME sector, has been tasked with helping raise SMEs’ contribution to GDP from around 20% to 35% by 2030. The authority identifies three structural challenges—human capabilities, government bureaucracy and access to financing—as central issues that need to be addressed if smaller businesses are to become a larger force in the economy.

The target is important because it changes the definition of economic diversification.

Diversification is not simply about replacing one large source of national income with another. A genuinely diversified economy requires thousands of businesses operating across different industries, sizes and geographies. It requires suppliers supporting larger companies, technology businesses serving traditional industries, consumer companies creating new demand, and entrepreneurs transforming previously fragmented markets.

That is where SMEs become particularly important.

Large companies can invest billions of riyals in a new industrial facility or infrastructure project, but SMEs create the ecosystem around those investments. They supply services, develop specialized technologies, provide logistics, recruit talent, build software and create new business models.

In other words, the economic value of SMEs is not limited to what they produce themselves; it also lies in what they enable other companies to produce.

This multiplier effect is becoming increasingly visible in Saudi Arabia.

Building an ecosystem around entrepreneurs

Saudi Arabia's rise as a startup hub has not been driven by venture capital alone. The Kingdom has spent years building a support architecture designed to address the practical barriers that can prevent startups from reaching scale.

Monsha’at’s Business Accelerators program provides startups with workspaces, consultancy, training, financial grants and access to investor networks, with programs designed to accelerate business development over periods of three to six months.

That support has also expanded beyond technology.

Monsha’at’s Dates Business Accelerator, for example, targets the entire dates value chain—from cultivation and harvesting to processing, packaging, marketing and sales. The program has recruited more than 175 startups, delivered more than 30 workshops and programs, facilitated more than 115 deals and partnerships, and provided more than 1,000 consulting hours.

The message is significant: Saudi Arabia is not attempting to build a startup ecosystem limited to fintech and mobile applications. It is increasingly trying to use entrepreneurship to modernize traditional sectors as well.

That approach is visible in tourism, healthcare, logistics, education, entertainment, agriculture and pilgrimage services.

In October 2025, Monsha’at launched a dedicated Hajj and Umrah entrepreneurship track designed to help entrepreneurs identify opportunities in pilgrim services and develop innovative solutions to improve the visitor experience.

The approach effectively turns some of the Kingdom’s largest economic transformation programs into markets for entrepreneurs.

A new tourism destination creates demand for booking platforms, hospitality technology, transportation solutions, event companies, food businesses and digital services. Expanding healthcare infrastructure creates demand for healthtech companies and specialized service providers. Growing logistics activity creates opportunities for supply-chain technology, last-mile delivery and warehouse solutions.

The result is a powerful relationship between mega-project investment and SME formation.

Financing is becoming less of a bottleneck

For many years, financing was one of the biggest constraints facing Saudi SMEs. The problem was not necessarily a shortage of business ideas; it was the difficulty of converting those ideas into companies capable of surviving and scaling.

The financial ecosystem has changed substantially.

SVC, established in 2018, was created specifically to stimulate financing for startups and SMEs from the pre-seed stage through pre-IPO. Its investment model includes venture-capital funds, private equity, venture debt and private credit, alongside direct investments.

By the first half of 2025, SVC had backed 59 private-capital funds that supported more than 900 startups and SMEs.

The effect is broader than the capital committed by SVC itself. The organization’s role is increasingly that of a catalyst, helping attract private and institutional investors into the market and reducing some of the risk associated with investing in younger businesses.

The acceleration became particularly visible in 2025.

Saudi Arabia deployed $860 million in venture capital during the first six months of 2025, more than the entire amount invested during 2024. The number of transactions reached 114, up 31% year-on-year. E-commerce accounted for 36% of capital deployed, while fintech led by number of deals with 30 transactions.

By the end of the year, the market had reached the $1.72 billion record.

That trajectory suggests that the Kingdom's challenge is gradually changing. The question is no longer simply whether entrepreneurs can find capital. It is whether the ecosystem can produce enough investment-ready companies with sustainable revenues and regional or global growth potential to absorb the increasing pool of capital.

The startups filling the gaps

The strongest argument for the economic importance of Saudi startups comes from the problems they are solving.

Fintech is perhaps the clearest example.

Companies such as Tamara emerged from a gap between rapidly changing consumer behavior and the traditional financial system. What began as a buy-now-pay-later platform evolved into a broader financial-services business serving consumers and merchants.

In February 2025, Tamara raised $160 million in Series E financing at a valuation of $3.3 billion, demonstrating the scale of value that Saudi-born financial technology companies can create.

The company's growth is important not simply because of its valuation. It demonstrates how a startup can develop from solving a relatively narrow consumer problem into building financial infrastructure around a much larger ecosystem of merchants and customers.

The same logic applies to Lean Technologies, which has focused on financial infrastructure rather than consumer lending.

Lean provides open-banking and financial-data infrastructure that enables fintech companies and businesses to connect with bank accounts and build financial services more efficiently. Its development reflects a broader trend: Saudi startups are increasingly building the plumbing underneath the digital economy, rather than simply creating consumer-facing applications.

That distinction matters.

An application may have thousands or millions of users. Infrastructure companies can potentially enable thousands of other businesses to serve millions of users.

The economic multiplier can therefore be much larger.

The rise of B2B startups

Another major opportunity is emerging in business-to-business commerce.

Saudi Arabia's SME economy is large and increasingly sophisticated, but smaller businesses have historically faced challenges in procurement, inventory management, working capital, logistics and access to large suppliers.

This has created opportunities for B2B platforms.

Saudi startup Sary, for example, built its business around digitizing procurement and connecting businesses with suppliers. Its subsequent combination with ShopUp created SILQ Group, with the combined business raising $110 million from investors including Valar Ventures and Sanabil Investments.

The importance of companies such as Sary is not simply their own growth. B2B platforms can make thousands of smaller companies more efficient by lowering procurement costs, improving access to suppliers and bringing previously fragmented transactions onto digital platforms.

That creates another multiplier effect.

The startup becomes an economic intermediary, while its customers become more productive.

This is precisely the type of entrepreneurship that can accelerate SME productivity and help the wider private sector become more competitive.

Saudi Arabia becomes a magnet for international capital

Perhaps the most important signal that Saudi Arabia has become a genuine startup hub is the behavior of foreign investors.

International capital is increasingly entering the Kingdom not simply because of government incentives, but because investors see a combination of market size, high digital adoption, strong consumer spending, government-backed transformation programs and a growing pipeline of scalable companies.

In 2025, Saudi Arabia accounted for the largest share of venture capital investment in MENA, with international investors becoming an increasingly important part of the funding landscape. MAGNiTT data showed that the Kingdom attracted $1.72 billion across 257 deals, reinforcing its position as the region’s largest VC market for the third consecutive year.

The significance of this capital extends beyond individual funding rounds.

International investors bring networks, technology, management expertise and access to overseas markets. Their involvement can help Saudi startups move from being domestic businesses to regional companies.

That transition could become one of the defining features of the next stage of the ecosystem.

Saudi Arabia is a large market on its own, but the real opportunity for many startups lies in using the Kingdom as a launchpad into the broader GCC, MENA and, for selected technology businesses, global markets.

The government is actively encouraging this direction. In late 2025, Monsha’at took Saudi startups to international technology events including Slush in Helsinki and Web Summit Lisbon, connecting entrepreneurs with international investors, partners and innovation ecosystems.

This represents a shift in policy ambition—from bringing capital to Saudi Arabia to helping Saudi companies reach capital and customers abroad.

Artificial intelligence could redefine the next generation

If fintech and e-commerce dominated much of the Kingdom’s early startup-growth story, artificial intelligence could define its next phase.

Saudi Arabia is increasingly trying to establish itself as an AI market, infrastructure hub and development center simultaneously.

The country's startup-support infrastructure is adapting accordingly. In June 2026, Monsha’at announced the graduation of 33 AI startups from the first cohort of its AI incubator program, developed in partnership with the National Technology Development Program.

The startups operated across eight areas, including enterprise solutions, healthcare, tourism and culture, fintech, infrastructure and logistics, e-commerce and education.

This is important because AI is not being treated as an isolated technology sector. Instead, it is being positioned as a horizontal technology capable of transforming almost every part of the SME economy.

A logistics startup can use AI to optimize routes. A healthtech company can use it for diagnostics or administrative automation. A financial company can use it for fraud detection and credit assessment. A tourism business can use it for personalization and demand forecasting.

That creates the possibility of a second-order effect: AI startups do not simply become companies themselves; they can increase the productivity of thousands of other companies.

The challenge now is scaling, not starting

Saudi Arabia has made remarkable progress in creating businesses and attracting capital. But the next stage will be more difficult.

Creating a startup is relatively straightforward compared with turning it into a company capable of generating sustainable profits, employing hundreds or thousands of people, expanding internationally and returning capital to investors.

This is where the Kingdom's ecosystem will be tested.

The record $1.72 billion in venture capital investment in 2025 is impressive, but funding is not an end in itself. Capital must eventually translate into revenue, productivity, employment, exports and returns.

There are encouraging signs.

A joint 2026 report by Endeavor Saudi Arabia and SVC found that 77% of surveyed founders are considering an IPO, while 91% of those considering an IPO prefer to list on the Saudi Exchange, Tadawul. The report points to an emerging pipeline of venture-backed companies moving toward public markets.

That could prove transformative.

A mature startup ecosystem requires exits. Successful IPOs and acquisitions return money to investors, create experienced entrepreneurs and executives, generate new pools of capital, and demonstrate to the next generation of founders that building a high-growth company can produce significant economic value.

Endeavor's analysis estimates a potential pipeline of four to 12 additional venture-backed IPOs in Saudi Arabia under different scenarios. If only half of the potential listings materialize, the market capitalization represented by venture-backed public companies could increase significantly.

This could mark the beginning of a new cycle in which Saudi capital markets increasingly become part of the startup ecosystem rather than remaining a destination only for mature corporations.

Where will the next investment wave go?

The investment opportunity is also becoming broader. While fintech remains one of the strongest sectors, Saudi venture investment is increasingly flowing toward e-commerce, AI, logistics, healthcare, education, tourism and other sectors aligned with the Kingdom's diversification strategy.

In the first half of 2025, e-commerce attracted the largest share of venture capital by value, while fintech recorded the highest number of transactions.

Future capital is likely to become increasingly concentrated around businesses capable of demonstrating three characteristics: real demand, scalable economics and strategic relevance.

Artificial intelligence and deep technology are particularly well positioned. Healthcare and healthtech are likely to benefit from demographic and infrastructure changes. Tourism and entertainment will continue to create new markets as visitor numbers and domestic consumption expand. Logistics and industrial technology will benefit from the Kingdom's ambition to become a global trade and supply-chain hub.

Meanwhile, growth-stage companies are likely to attract more private equity and structured capital as they move beyond the startup phase.

The direction is already visible. SVC has expanded beyond traditional venture capital into private equity, venture debt and private credit, reflecting the growing need for financing options across different stages of company development.

This diversification of financing is critical.

A company should not have to rely on equity funding at every stage of its life. As Saudi businesses mature, debt, growth equity, private equity and eventually public markets can provide alternative sources of capital.

The next economic engine will be measured by productivity

Saudi Arabia's SME revolution should therefore not be measured only by the number of startups established or billions of dollars raised. The more important question is what these companies are doing to the structure of the economy. Are they making businesses more productive? Are they reducing transaction costs? Are they creating skilled jobs? Are they bringing women and young people into entrepreneurship? Are they developing intellectual property? Are they creating companies capable of exporting Saudi technology and services? And, ultimately, are they producing sustainable financial returns?

There are already signs of progress.

The Kingdom's entrepreneurial activity rate rose from 12.1% in 2018 to 28.9% in 2025, while entrepreneurial intentions increased from 26.8% to 48.5%, according to the Global Entrepreneurship Monitor 2025–2026 report. Saudi Arabia ranked third globally in the National Entrepreneurship Context Index and led high-income economies in entrepreneurial finance.

Those figures reveal something deeper than a rise in company registrations. They indicate a change in economic culture.

Entrepreneurship is becoming a mainstream economic pathway rather than a niche activity. Young Saudis are increasingly seeing company-building as a career, while international founders and investors are viewing the Kingdom as a market in which companies can be built at scale.

That cultural shift may ultimately prove as important as the financial incentives.

From ecosystem to economic force

Saudi Arabia's SME sector has reached an inflection point. The Kingdom now has the scale of businesses, capital, institutional infrastructure and market demand required to create a self-reinforcing entrepreneurial ecosystem. The challenge is to convert that scale into durable companies.

The government has built much of the foundation: Monsha’at has expanded support programs; SVC has helped develop private-capital markets; regulatory reforms have made it easier to establish and operate businesses; accelerators and incubators are helping companies develop; and Vision 2030 projects are creating new markets.

Private investors are now adding another layer. The record $1.72 billion in venture capital investment in 2025 shows that the market has moved beyond experimentation. International investors are entering, Saudi funds are becoming more sophisticated, and founders are beginning to think about IPOs rather than only their next funding round.

But the real measure of success will come over the next decade.

If today's startups can evolve into tomorrow's major employers, technology providers, exporters and listed companies, SMEs could become one of the most important mechanisms through which Saudi Arabia converts Vision 2030's investment cycle into a sustainable private-sector economy.

The Kingdom's transformation, in that sense, is moving from a story about building projects to building companies.

And that may be the most important economic shift of all.

The future Saudi economy will still contain major corporations and large-scale investments. But around them will increasingly sit a dense network of entrepreneurs—fintech companies supporting financial inclusion, logistics startups connecting businesses, AI companies raising productivity, healthtech ventures improving services, tourism startups creating experiences, and B2B platforms making SMEs more competitive.

Ghada Ismail

What if you could build an app without knowing how to write code?

That is the idea behind vibe coding, an emerging approach to software development that uses artificial intelligence to turn natural language instructions into working code. Instead of writing every line manually, users describe what they want to build, and an AI tool generates the code, fixes errors, and helps refine the product through an ongoing conversation.

The term “vibe coding” was popularized in 2025 by AI researcher Andrej Karpathy, who described a style of programming where developers rely heavily on AI and focus more on describing the desired outcome than manually writing and reviewing every line of code.

How does vibe coding work?

Vibe coding typically starts with a simple prompt.

A user might tell an AI coding assistant: “Build a dashboard that shows monthly sales, allows users to filter by region and displays the results in charts.”

The AI can then generate the underlying code. The user tests the result and tells the AI what needs to change: perhaps the dashboard needs a different design, a new feature or a fix for an error.

This creates a conversational development cycle:

Describe → Generate → Test → Refine → Repeat.

The process can allow someone with limited programming experience to turn an idea into a functioning prototype much faster than traditional development.

Why is vibe coding becoming popular?

The rise of generative AI has significantly lowered the technical barrier to building software.

For startups, this can be particularly valuable. Founders can experiment with product ideas, build minimum viable products (MVPs), and test concepts before committing significant resources to a development team.

A nontechnical founder, for example, could use vibe coding to create an early version of a marketplace or customer portal and show it to potential customers. If the idea does not work, the founder can move on without spending months and substantial capital on development.

Even experienced developers can use the approach to speed up routine tasks, generate boilerplate code, explore ideas and create prototypes.

Vibe coding is not the same as traditional coding

The biggest difference is the role of the human.

In traditional software development, programmers typically write, inspect, and understand the code behind an application. With vibe coding, the user may focus primarily on what the software should do, while AI handles much of the implementation.

That does not mean coding knowledge has become irrelevant.

AI-generated code can contain bugs, security vulnerabilities, inefficient architecture, or technical decisions that work for a prototype but create problems as the product grows.

This is why vibe coding works best when users understand at least the basics of software development or have access to someone who can review the output.

What are the risks?

The biggest risk is assuming that working code is automatically good code.

An AI-generated application may appear to function perfectly while containing security weaknesses or scalability problems. Users may also struggle to maintain a project if they do not understand how its underlying code works.

There are also concerns around data privacy, intellectual property, and reliance on AI-generated code.

For businesses, these risks become more important as a prototype evolves into a product handling sensitive customer or financial information.

What does vibe coding mean for startups?

Vibe coding could change how early-stage companies build and validate products.

Instead of raising money first and building later, founders can potentially create functional prototypes, gather customer feedback, and demonstrate traction much earlier.

It could also make entrepreneurship more accessible by allowing people with strong ideas but limited technical skills to participate more directly in product development.

But vibe coding is unlikely to eliminate software engineers. Rather, it may change what developers spend their time doing. As AI handles more routine coding tasks, human expertise could become increasingly important in areas such as architecture, security, testing, product design, and complex problem-solving.

In that sense, vibe coding is less about replacing programmers and more about changing the interface between humans and software development.

For startups and entrepreneurs, its biggest promise may be simple: turning an idea into something users can actually try, faster than ever before.

Kholoud Hussein 

A company can have a compelling business model, strong revenue growth, and an ambitious founder—and still struggle to scale if it chooses the wrong investor. In today’s competitive funding environment, finding capital is no longer the only challenge for startups and growing companies. Finding the right investor may be just as important as securing the investment itself.

The Right Investor for Your Company: Beyond the Size of the Check

For entrepreneurs, the temptation is often straightforward: choose the investor offering the largest valuation or the biggest cheque. But capital comes with more than a financial value. It can bring strategic guidance, industry connections, governance requirements, operational expertise and, in some cases, significant pressure to deliver rapid returns.

The most suitable investor, therefore, is not necessarily the one willing to invest the most money. It is the investor whose capital, experience, network and expectations match the company's stage and ambitions.

This distinction is becoming increasingly important as startups move from an era of abundant funding toward a more selective investment environment. Investors are paying greater attention to business fundamentals, revenue quality, scalability and the path to profitability. At the same time, founders are becoming more careful about who they bring onto their cap tables.

Strategic investors: Capital with industry knowledge

For companies operating in specialized sectors, a strategic or corporate investor can offer advantages that go well beyond funding.

A strategic investor may bring access to distribution channels, customers, technology, suppliers or regulatory expertise. For a fintech startup, for example, an investment from a financial institution could potentially open doors to banking partnerships and a wider customer base.

The trade-off is that strategic investors may have objectives that differ from those of purely financial investors. Their priorities could include market access, technology integration or strengthening their own competitive position.

For a founder, the question should therefore be simple: What can this investor unlock that money alone cannot?

Venture capital: The growth partner

Venture capital investors are typically suited to businesses with the potential to scale rapidly across large markets.

Beyond funding, experienced VC firms can provide support in areas such as hiring senior executives, entering new markets, refining business models, and preparing for subsequent funding rounds. Their networks can also help startups connect with future investors and strategic partners.

However, venture capital is not suitable for every company.

VC funds generally seek significant growth and returns within a defined investment horizon. That can create pressure for a startup to expand quickly, raise additional rounds, and ultimately pursue an exit.

A profitable company that prefers steady expansion and greater founder control may therefore find that traditional venture capital is not the ideal match.

Private equity: For companies entering a new phase

As companies mature, their financing requirements often change. Private equity investors can become more relevant for businesses with established revenues, stronger operating structures and opportunities for expansion, consolidation or restructuring.

Unlike early-stage venture capital, private equity typically focuses more heavily on operational performance, cash flows and the potential to create value over a defined investment period.

For a growing company, the attraction may be the investor's ability to finance acquisitions, expand geographically or professionalize management. But founders should also be prepared for a more structured governance environment and potentially greater investor involvement in strategic decisions.

Family offices: Patient capital and relationships

Family offices have become increasingly relevant to entrepreneurs seeking investors with longer-term perspectives.

Their investment strategies vary considerably, but some family offices can offer more patient capital than traditional funds, particularly when they have a strong interest in a particular industry, geography or long-term business opportunity.

For founders, however, understanding the investment philosophy of the specific family office is crucial. Two family offices can have completely different approaches to risk, control, investment horizons and portfolio involvement.

The investor-founder relationship matters

Perhaps the most overlooked factor is chemistry.

An investment can last for years, meaning that the relationship between founders and investors can become one of the company's most important strategic partnerships. Disagreements over growth rates, hiring, acquisitions, fundraising or the timing of an exit can become costly if expectations were not aligned from the beginning.

Founders should therefore examine an investor's track record, including how they behaved when portfolio companies faced difficulties—not only how they supported companies during successful periods.

It is also worth speaking with founders of existing and former portfolio companies. Their experiences can reveal how an investor communicates, handles disagreements and supports management during challenging periods.

The right capital depends on the company's stage

There is no universal definition of the "best" investor.

An early-stage startup may need an investor who understands product development and customer acquisition. A scale-up entering new markets may prioritize international networks and operational expertise. A mature company may need growth capital, acquisition financing or support for a potential listing.

The company's funding requirements should therefore come before the investor search.

Founders should ask several fundamental questions: How much capital is actually needed? What will it finance? How quickly must the company grow? How much ownership is the founder prepared to give up? What level of investor involvement is acceptable? And what should the company look like after the investment?

The cost of choosing the wrong investor

The consequences of a poor investor match can extend well beyond dilution.

A misaligned investor can create conflicts over strategy, push for growth before the business is ready, restrict management flexibility or make future fundraising more complicated. In extreme cases, disagreements between shareholders can consume management time and distract the company from its core business.

That is why due diligence should work both ways.

Just as investors assess founders, founders should assess investors. The size of the fund, previous investments, sector expertise, portfolio conflicts, follow-on funding capacity and reputation should all form part of the evaluation.

Capital should accelerate the company's strategy—not replace it

Ultimately, the right investor is the one who understands where the company is today and where the founders want it to go tomorrow.

A strong investor-company relationship should create more than financial value. It should help the business access new markets, strengthen its management, improve its capabilities and build a more resilient organization.

For entrepreneurs, the lesson is increasingly clear: fundraising should not be treated as a race to find the biggest cheque. It should be treated as a strategic exercise to find the right partner.

The best investor is rarely the one who simply offers the most money. It is the one whose capital and capabilities can help the company achieve its next stage of growth—while allowing founders and investors to remain aligned on the road ahead.

Noha Gad

Hostile takeovers are one of the most dramatic forms of corporate conflict in the high-stakes world of mergers and acquisitions (M&A). It occurs when an acquirer attempts to gain control of a target company without the approval of its board of directors, often by making a direct offer to shareholders or launching a proxy fight to replace management. 

To face this pressure, target companies deploy a range of defensive tactics designed to raise the cost of acquisition, reduce the attractiveness of the bid, or find a more favorable alternative. White knight defense is one of the most constructive tactics that allows the target to accept the reality of a change in control while steering the outcome toward a more acceptable buyer, better terms, and greater continuity for management and operations.

How does a white knight defense strategy work?

A white knight defense is a takeover defense strategy in which a target company, facing a hostile bid, seeks out a friendly third-party acquirer and invites or encourages it to make a competing offer, thereby providing an alternative to the hostile bidder. This friendly buyer, or the white knight, is invited or encouraged by the target’s board to acquire the company on more favorable terms than the hostile bidder, often referred to as the “black knight.”

This strategy protects the target's management and often provides better compensation for shareholders, preventing control from passing to an unfriendly bidder.

How does it work?

1. The target company seeks another acquirer to stave off the unfriendly acquirer, who is typically called the black knight.
2. The white knight makes an offer to purchase the target, usually at a premium to the hostile acquirer's bid or with more favorable terms amenable to the target's shareholders, management, and/or board of directors.
3. Once the acquisition is complete, the white knight may choose to keep the target's management and/or board rather than replace one or both. The white knight may also choose to keep the target's business operations as is after the deal goes through.

Black, gray, and yellow knights

Along with the white knight, there are different types of so-called knights in the business world. The most common ones are: 

• Black knight. This type makes an unsolicited, hostile bid for its target. This entity does whatever it can to complete the transaction, even going over the target's board of directors. The target company does not want to be taken over by the black knights because of their selfish motivations.
• Gray knight. A gray knight is not as desirable as a white knight, but it is more desirable than a black knight. The gray knight is the third potential bidder in a hostile takeover who outbids the white knight. Although friendlier than a black knight, the gray knight still seeks to serve its interests.
• Yellow knight. A yellow knight is a company that planned a hostile takeover attempt, but backs out of it and instead proposes a merger of equals with the target company.

Advantages of a white knight defense strategy

The white knight defense offers several strategic benefits for target companies, their boards, and shareholders when facing hostile takeover pressure. This includes:

• Higher shareholder value. White knights typically offer better terms than hostile bidders, including higher premiums per share, more favorable payment structures, or clearer timelines for closing the deal. 
•  Preservation of management and strategic direction. Unlike hostile takeovers, which often lead to immediate leadership changes and strategic overhauls, white knight acquisitions usually retain existing management teams. The friendly acquirer typically shares the target's vision for the company's future, allowing for continuity in strategic plans and reducing uncertainty among employees and stakeholders. 
• Deal certainty and reduced transaction risk. White knight transactions are negotiated with the target's board and typically come with secured financing, transparent timelines, and clear post-merger agreements. This reduces uncertainty for all stakeholders compared to the protracted legal battles and defensive maneuvers that hostile takeovers often entail.

Despite these advantages, the white knight defense is not without significant risks and limitations, such as:

• Loss of independence. While a white knight takeover is preferable to a hostile one, it still results in the abrupt transfer of ownership to a third party. The target company becomes part of a larger entity, and its autonomy in decision-making is inevitably reduced.
• Overpayment and financial leverage risks. To outbid the hostile acquirer, white knights may overpay for the target company, leading to inflated acquisition premiums. This can result in excessive leverage for the acquiring company, which may create financial strain down the line and potentially undermine the long-term value of the combined entity. 
• Limited negotiation options and time constraints. Once a white knight is engaged, the target company may have limited options to negotiate with other potential buyers. The urgency of responding to a hostile bid often means there is insufficient time for thorough due diligence or comprehensive negotiation of terms. 

Finally, the white knight defense is less about avoiding a takeover and more about controlling its terms. By inviting a friendly acquirer, the target company can secure a higher price for shareholders, preserve management and strategic direction, and reduce the uncertainty that comes with hostile bids. However, this comes at the cost of independence and may involve rushed decisions, overpayment, and limited negotiation room. 

Ghada Ismail

Before a single road is built, a tower rises, or a railway is laid, another kind of construction is already underway high above the ground. Helicopters equipped with advanced laser scanners survey vast desert landscapes, drones capture thousands of high-resolution images over construction sites, and satellites continuously monitor coastlines, mountains, and cities. Together, these technologies create a digital blueprint of Saudi Arabia long before physical development begins. 

This is the world of geospatial intelligence, an industry that combines aerial surveying, remote sensing, geographic information systems (GIS), artificial intelligence, and digital modeling to transform location data into actionable insights. While largely invisible to the public, these technologies have become essential to Saudi Arabia's Vision 2030, supporting giga-projects, energy infrastructure, environmental conservation, and smart city development. Behind every landmark project lies an equally ambitious effort to map, analyze, and monitor the Kingdom with unprecedented precision. 

More Than Mapping

Modern geospatial services extend far beyond aerial photography. Aircraft and drones equipped with LiDAR sensors, thermal cameras, and multispectral imaging systems capture millions of measurements every second, producing highly accurate three-dimensional models and engineering-grade imagery. Once processed through GIS platforms and AI-powered software, this data becomes a digital representation of the physical world that supports planning, construction, maintenance, and operational decision-making. 

Demand for these capabilities has surged under Vision 2030. Mega-projects such as NEOM, The Red Sea, Diriyah, Qiddiya, renewable energy developments, logistics hubs, mining operations, and transportation corridors all require continuous surveying throughout their lifecycle. Rather than relying solely on traditional ground surveys, project teams now use helicopters, drones, and satellites to collect accurate spatial data in hours instead of weeks while improving safety by reducing the need for personnel to inspect hazardous locations. 

Helicopters and Drones: Complementary Technologies

Although drones dominate today's headlines, helicopters remain indispensable for large-scale aerial surveying. While drones excel at collecting highly detailed data over localized areas, helicopters are better suited for inspecting long infrastructure corridors, oil and gas pipelines, transmission lines, coastlines, and other remote areas where endurance and payload capacity are essential.

Among the companies supporting this capability is The Helicopter Company (THC), whose expanding operations across Saudi Arabia increasingly support infrastructure inspection, environmental monitoring, emergency response, and specialized aerial surveying. 

Drones, meanwhile, have transformed data collection by making aerial surveys faster, safer, and more affordable. Construction firms monitor project progress, mining operators calculate excavation volumes, utility companies inspect transmission lines, and environmental agencies assess vegetation and coastal erosion. Increasingly, the industry's focus has shifted from the aircraft themselves to the intelligence they generate, giving rise to Saudi companies that combine aerial operations with artificial intelligence, engineering expertise, and advanced analytics. 

Turning Data into Intelligence

Collecting aerial data is only the first step. The real value lies in transforming millions of images, laser measurements, and GPS coordinates into insights that engineers and decision-makers can use.

This is where Saudi Arabia's geospatial ecosystem is rapidly evolving. Companies increasingly provide end-to-end solutions that integrate aerial surveys, AI, GIS, cloud computing, and digital engineering rather than simply delivering imagery.

One example is Terra Drone Arabia, which provides aerial surveying, LiDAR mapping, photogrammetry, industrial inspections, and digital twin services across sectors including construction, oil and gas, utilities, and mining. By combining these capabilities with AI-powered analytics, the company helps organizations move beyond visual inspections toward predictive asset management and data-driven decision-making. The broader trend is clear: geospatial companies are no longer selling images; they are delivering intelligence. 

Beyond Construction

While mega-projects often dominate discussions about geospatial technology, its applications extend across virtually every major industry. Energy companies use drones and helicopters to inspect pipelines, offshore facilities, and power transmission networks. Mining operators monitor excavation progress and environmental compliance, while agricultural businesses rely on multispectral imaging to assess crop health, irrigation efficiency, and soil conditions. Environmental agencies track desertification, biodiversity, and flood risks, telecommunications providers optimize network coverage, and insurers increasingly use aerial imagery to assess property damage and streamline claims.

These diverse applications demonstrate that geospatial intelligence is no longer a niche engineering discipline. It has become a foundational digital capability supporting industries ranging from energy and logistics to agriculture, telecommunications, public safety, and environmental management. 

Building Talent for a Growing Industry

Technology alone cannot build a geospatial economy. Every successful mission depends on pilots, engineers, GIS specialists, software developers, AI experts, and data analysts capable of transforming raw data into meaningful insights. Recognizing this need, Saudi Arabia is investing heavily in workforce development.

DroneX Academy prepares professionals for commercial drone operations through practical training and certification programs, while the Drones Academy at the College of Computer Science and Engineering, University of Jeddah integrates education, research, AI, robotics, and industry collaboration to prepare students for next-generation geospatial technologies. Meanwhile, the Drones Club at Tuwaiq Academy introduces younger innovators to drone technologies through workshops, technical challenges, and hands-on learning. Together, these initiatives reflect a shift from training drone pilots to building a complete talent pipeline for the Kingdom's expanding geospatial sector. 

The Next Frontier

Despite its rapid growth, the industry faces important challenges. Expanding commercial drone operations will require continued progress in regulation, airspace integration, and Beyond Visual Line of Sight (BVLOS) operations. At the same time, protecting sensitive geospatial data from cyber threats and integrating information from drones, satellites, IoT sensors, and engineering systems into unified platforms will remain key priorities. Meeting growing demand for AI specialists, GIS analysts, remote sensing experts, and digital twin developers will be equally critical. 

Looking ahead, artificial intelligence is expected to accelerate the industry's evolution by automating image analysis, identifying infrastructure defects, monitoring construction progress, and detecting environmental changes.

A Digital Foundation for Vision 2030

Saudi Arabia's transformation is often measured through its skyline, mega-projects, and landmark developments. Yet much of that transformation begins long before construction starts. It starts with helicopters surveying remote terrain, drones capturing millions of data points, satellites monitoring environmental change, and engineers transforming spatial information into digital models that guide billion-riyal investments.

Companies including The Helicopter Company and Terra Drone Arabia contribute to this evolving ecosystem, while institutions such as DroneX Academy, the University of Jeddah's Drones Academy, and the Drones Club at Tuwaiq Academy are developing the talent needed to sustain it. Together, they illustrate that geospatial intelligence has evolved from a technical support function into a strategic capability underpinning infrastructure planning, industrial productivity, environmental stewardship, and digital transformation.

As Vision 2030 advances, Saudi Arabia is not only building new cities and industries; it is creating a detailed digital representation of the Kingdom itself. In many ways, the nation's next great transformation is taking shape first in the virtual world, where every road, pipeline, coastline, and building is mapped, analyzed, and understood before it is built on the ground. 

Noha Gad

The e-commerce landscape in Saudi Arabia is experiencing unprecedented growth, solidifying the Kingdom's position as the largest and most dynamic digital marketplace in the region. According to a recent report from BMI, a FitchSolutions company, household spending in the Kingdom will grow by a real 3.3% year-on-year (YoY) in 2026, a slight decline from 3.4% in 2025. The report anticipated household spending growth to accelerate slightly to 3.7% YoY in 2027, taking real spending to 39.4% above pre-COVID-19 pandemic levels. This growth is driven by digital acceleration that reshapes consumer expectations, shifting the focus from mere access to products towards a demand for efficiency, transparency, reliability, and a superior overall user experience.

Within this dynamic and competitive landscape, Kanaa, a Saudi-born digital e-commerce platform, officially launched in the Kingdom in April 2026, introducing a curated commerce model designed to simplify product discovery while maintaining high standards of quality and trust. 

Sharikat Mubasher held an exclusive interview with Kartik Bhatt, CEO of Kanaa, to dive deep into the company’s business model, strategy, and technology, as well as its ambitions to expand and strengthen its presence across the Kingdom.

Kanaa officially launched in Saudi Arabia in April, introducing a curated commerce model to simplify product discovery while maintaining quality and trust. Can you tell us more about this model and what sets Kanaa apart from established marketplaces and specialty omni-retailers?

Saudi Arabia's e-commerce market has matured significantly over the past few years. Customers already have access to millions of products, fast delivery, and seamless payment options. However, all of that came with a lot of noise from endless choices, inconsistent content, bad reviews, and unpredictable service. This has made most customers insecure about whether they are making the right purchasing decision or not. They may feel that they are not getting the best deal, service, or product.

That is the thinking behind Kanaa's curated commerce model. We focus on offering the right products, presented with reliable information and backed by a consistent customer experience. Every product is carefully selected, supported with quality content and held to the same standards for pricing, fulfilment, and service.

Our model combines our own retail assortment, direct partnerships with leading brands, exclusive product collections, and a carefully managed marketplace. Each plays a specific role, but together they create a shopping experience customers can trust.

Today, our focus is on families, children, youth, and modern Saudi consumers across toys, books, gaming, hobbies, and lifestyle categories, with additional categories planned as we continue to grow.

Since launching in November 2025, we have achieved 44-fold growth in sales and a 30-fold increase in order volume. Those results confirm that we are solving a real customer need. Customers are not just looking for more products. They also need real confidence in what they are buying and where they are buying it from.

How does Kanaa plan to implement its strategy that is centered on curated selection, operational efficiency, and customer trust?

As I mentioned earlier, curation is only one part of the equation. Delivering a great customer experience depends just as much on how consistently you execute behind the scenes.

We start with the assortment itself, making sure every category has a clear purpose: everyday essentials, seasonal collections, exclusive partnerships, or marketplace offerings. Every category earns its place, and we are careful not to let the catalogue grow just for the sake of it.

Operational excellence is equally important. Customers remember whether an item was in stock, whether it arrived on time, and how quickly an issue was resolved. That is why we have invested heavily in inventory accuracy, delivery performance, returns management, and customer support. Today, we provide same-day delivery in Jeddah, are expanding that capability in Riyadh, and consistently deliver more than 98% of orders on time.

Technology underpins every stage of that experience, from search and stock visibility to personalized recommendations and a seamless checkout process. At the same time, we continue to build customer trust through transparent product information, clear policies, and responsive service.

Sales growth and traffic matter, but repeat purchases, customer loyalty, and our ability to build lasting relationships are what tell us this is actually working.

Does Kanaa integrate AI and machine learning into its business model — for search and discovery, fraud detection, pricing optimization, or logistics planning?

Absolutely. AI is already an important part of how we operate, especially in helping customers discover the right products more conveniently.

For example, a parent looking for a suitable gift or a teenager searching for gaming accessories rarely use precise search keywords. It is mostly broad categories, brand variations, use case-related keywords, etc. AI allows us to better understand customer intent and provide recommendations that feel more relevant and personalized, much like the guidance customers receive from an experienced sales advisor in a physical store.

Behind the scenes, we are also applying AI across demand forecasting, fraud detection, catalogue quality management and returns analysis. As the business grows, we will continue expanding its use across pricing optimization and logistics planning.

The real opportunity is the insights that come with connecting such capabilities. When demand shifts around a product, season, or occasion, AI can help us respond more quickly by improving inventory planning, product content, and stock allocation. That is what supports our next phase of growth, including marketplace expansion, new strategic partnerships, and our planned entry into the UAE.

A recent study conducted by Visa showed that 91% of consumers in Saudi Arabia embrace AI as part of their shopping journey. In your opinion, how do AI technologies revolutionise the shopping experience in the Kingdom?

These findings mirror current market behavior. Saudi Arabia is home to some of the most tech-forward shoppers globally, and they have already outgrown traditional e-commerce. They expect platforms to understand context and intent, bringing a level of personalization that standard catalog search simply cannot deliver 
AI helps deliver that in a few ways. It simplifies product discovery by understanding what customers are actually looking for rather than relying only on keywords. It also personalizes the experience, recognizing that someone shopping for children's toys has very different needs from someone looking for gaming products or gifts. Just as importantly, AI strengthens the experience in ways customers may not always notice directly. It improves product information, helps detect fraud more effectively, and enables faster customer service, all of which contribute to a smoother, more reliable shopping journey.

For years, online shopping missed something obvious: that helpful salesperson in the store who actually gets what you are looking for. AI finally lets us bring that human touch online, in both Arabic and English, at scale. We are not interested in AI hype for the sake of it; for us at Kanaa, it is just about making shopping easier, faster, and genuinely helpful.

What strategic partnerships are you pursuing to accelerate growth and enhance customer experience?

No platform succeeds in isolation. Our model is built entirely on smart partnerships. We deliberately chose not to build a bloated, open marketplace with lots of unverified sellers. We curate our brand and retail partners strictly because customers deserve reliable quality and pricing, not endless scrolling through questionable listings.

We take the same approach across the board. We are partnering with AI leaders to strengthen discovery, personalization, and fraud prevention capabilities that would take years to build in-house at the same quality. Logistics and last-mile partners are just as critical as merchandising ones. A platform can win a customer through marketing, but it keeps them through delivery and service.

We are also building relationships beyond conventional commerce, with schools, malls, creators and family-focused communities, because category education and gifting inspiration matter almost as much as the transaction itself. 

What are Kanaa's plans to expand its footprint within and beyond Saudi Arabia, driven by its mission to shape the next phase of e-commerce growth? What regional or international markets do you target next?

Our priority right now is the Kingdom. We want real depth here before we look anywhere else, which means strengthening our category leadership and continuing to invest in technology, fulfillment, and data. 

We still see significant demand across Saudi families, youth, and digitally native consumers who want a platform that understands their language, occasions, and service expectations.

Looking beyond the Kingdom, the GCC is the natural next step. UAE, Kuwait, Qatar, Bahrain, and Oman all share the digital adoption and purchasing power that fit our model, and our current plan is to enter the UAE in 2026.

We would rather take a Saudi-born platform to the region once we have proven it here than expand early and lose what makes Kanaa trusted in the first place.

As a seasoned leader with more than 20 years of experience scaling large-format retail and e-commerce businesses, how do you assess Saudi Arabia's e-commerce sector? What does the sector need over the coming years to continue growing?

Saudi Arabia's e-commerce sector has made remarkable progress over the past decade. The industry successfully addressed the fundamentals by expanding product availability, strengthening logistics, and giving consumers the confidence to shop online. That created strong and sustained growth across the market. I have watched a few markets go through this same shift, and Saudi Arabia is moving through it faster than most.

The next phase is really about the quality of the customer experience. Promotions and discounts can generate short-term sales, but long-term success depends on service reliability, customer retention, strong category expertise, and sustainable growth.

I also believe the industry has an opportunity to invest more in merchandise planning and product content, so customers get relevant assortments, accurate information, and a better overall shopping experience.

Finally, the sector needs to become even more locally relevant. That means reflecting Saudi shopping habits, family occasions, gifting traditions, and Arabic-first customer experiences in a more meaningful way. That is the shift I would tell any new entrant to prepare for.

Ultimately, I believe the companies that succeed over the coming years will be those that consistently earn customer trust through every interaction rather than those that offer the largest catalogue.

Kholoud Hussein 

From fintech unicorns to AI-powered startups, Saudi Arabia is rapidly transforming from an emerging startup ecosystem into one of the world's fastest-growing venture capital destinations. Backed by Vision 2030, government reforms, sovereign capital and an increasingly sophisticated entrepreneurial ecosystem, the Kingdom is now attracting global investors at an unprecedented pace.

For decades, global investors associated Saudi Arabia with oil, infrastructure, and large-scale government projects. Today, that perception is changing rapidly. International venture capital firms, sovereign wealth funds, family offices, and institutional investors are increasingly looking beyond traditional sectors and directing billions of dollars toward Saudi startups, convinced that the Kingdom is entering a new era of innovation-led growth.

The shift is neither accidental nor temporary. It reflects years of structural reforms under Vision 2030, an expanding digital economy, a young and tech-savvy population, and an ambitious government determined to position Saudi Arabia as the innovation hub of the Middle East.

The numbers tell a compelling story.

According to the latest Saudi Venture Capital Report by MAGNiTT, sponsored by Saudi Venture Capital Company (SVC), Saudi startups secured $1.72 billion in venture capital funding across 257 investment deals during 2025—the highest annual funding ever recorded by a single country in the MENA region. Saudi Arabia also became the region's largest VC market in both capital deployed and transaction volume, accounting for nearly half of all venture capital invested across the Middle East and North Africa. More importantly, the investor base became its most international to date, reflecting growing confidence among global funds in the scalability of Saudi startups. 

Those figures are significant not only because they represent record-breaking capital inflows, but because they highlight the evolution of Saudi Arabia from an emerging ecosystem into a mature investment destination. Unlike previous years, when venture activity depended heavily on a handful of large funding rounds, capital in 2025 was distributed across a much broader range of startups and growth stages, suggesting that the ecosystem is developing greater depth and resilience. 

A Market Too Big to Ignore

International investors are increasingly attracted to Saudi Arabia for one fundamental reason: market opportunity.

With a population exceeding 35 million, one of the highest smartphone penetration rates globally, and a digital-first consumer base, Saudi Arabia offers startups immediate access to one of the largest and wealthiest domestic markets in the region. Unlike smaller Gulf economies, founders can achieve significant scale within Saudi Arabia before expanding internationally.

The Kingdom's digital transformation has further accelerated this momentum. Government-led initiatives in digital infrastructure, cloud computing, artificial intelligence, fintech regulation, logistics, and e-commerce have created fertile ground for startups capable of solving real market problems.

Officials have repeatedly emphasized that entrepreneurship has become a strategic pillar of economic diversification. Through organizations such as Monsha'at, SVC, the Public Investment Fund (PIF), and various accelerator programs, policymakers have worked to remove barriers to business creation while increasing access to capital throughout the startup lifecycle.

The results are becoming increasingly visible. Saudi Arabia is no longer competing simply as the Gulf's largest economy; it is competing to become one of the world's most attractive destinations for venture capital.

Government Capital Is Crowding In Private Capital

One of the defining characteristics of Saudi Arabia's startup success is that public investment has encouraged—not replaced—private investment.

Instead of directly funding every startup, government-backed institutions have focused on building an ecosystem capable of attracting domestic and international investors alike.

Saudi Venture Capital Company (SVC), established under the National Development Fund ecosystem, has become one of the Kingdom's most influential market enablers by investing through venture capital funds, private equity vehicles, venture debt, and direct financing initiatives. Its fund-of-funds model has significantly expanded the availability of growth capital while encouraging leading global investors to participate alongside Saudi institutions.

This catalytic approach has changed investor perceptions.

Rather than viewing Saudi Arabia as a government-driven market, international investors increasingly see an ecosystem supported by strong institutions, clear regulations, and improving exit opportunities.

MAGNiTT's latest analysis highlights that investor participation expanded dramatically during 2025, with international funds accounting for a growing share of venture transactions. The report notes that this broader investor base reflects rising confidence in the Kingdom's regulatory environment, startup quality, and long-term growth prospects. 

Global Funds Are Following the Winners

Perhaps the strongest signal of Saudi Arabia's investment maturity is the calibre of international investors now participating in funding rounds.

Major global firms—including Wellington Management, Blue Pool Capital, and several international growth funds—have joined financing rounds for Saudi startups, particularly in fintech and digital commerce. Their participation demonstrates that Saudi companies are no longer relying solely on local capital but are successfully competing for investment on a global stage. 

Delivery and quick-commerce platform Ninja secured one of the region's largest startup funding rounds, while fintech leader Tabby raised another mega-round that attracted international investors. Digital payments platform HALA also completed a major financing round, highlighting growing investor appetite for Saudi fintech infrastructure. Together, these deals have helped reshape international perceptions of the Kingdom's startup ecosystem—from a promising emerging market to one capable of producing regional category leaders. 

Yet perhaps the most encouraging development is that Saudi Arabia's growth story is no longer dependent on mega-deals alone. Funding activity has expanded across seed, Series A, and growth-stage investments, creating a healthier pipeline of companies capable of becoming the next generation of regional champions.

Where Global Capital Is Flowing—and Why

If the first phase of Saudi Arabia's startup journey was about proving the market's potential, the next phase is about identifying the sectors capable of generating regional champions and globally competitive companies. Investors are no longer asking whether Saudi Arabia has promising startups—they are asking which industries will produce the Kingdom's next unicorns.

The answer, increasingly, lies in sectors that align with both the Kingdom's structural economic transformation and global technology trends.

Fintech: The Cornerstone of Saudi Venture Capital

No sector has attracted more investor attention than fintech. As Saudi Arabia accelerates its transition toward a cashless economy, demand for digital payments, embedded finance, lending platforms, wealth management, and banking infrastructure continues to rise.

According to MAGNiTT and Saudi Venture Capital Company (SVC), fintech remained the Kingdom's largest venture capital recipient in 2025, accounting for more than $500 million in funding across dozens of transactions. The sector benefited from supportive regulation by the Saudi Central Bank and the Capital Market Authority, both of which have expanded regulatory sandboxes and licensing frameworks to encourage innovation.

Investors view Saudi fintech as more than a domestic opportunity. With financial inclusion expanding across the GCC and digital banking becoming mainstream, Saudi startups are increasingly developing solutions that can be exported throughout the region.

Among the most prominent examples is Tabby, whose latest funding round attracted leading international investors and pushed its valuation above the billion-dollar mark. While headquartered in the Gulf, the company's continued expansion in Saudi Arabia reflects the Kingdom's importance as the region's largest consumer market.

Digital payments platform HALA has also emerged as a strong example of investor confidence in Saudi financial infrastructure, while newer startups specializing in SME financing, accounting automation, payroll, and embedded finance are attracting increasing attention from regional and international funds.

AI Is Becoming the Next Investment Frontier

If fintech dominated the previous wave of venture investment, artificial intelligence (AI) is expected to define the next.

Saudi Arabia has made AI a national priority through its broader digital transformation agenda. Significant government investment in cloud infrastructure, data centers, semiconductor partnerships, and AI research has created an environment where startups can commercialize AI applications at scale.

International investors increasingly view Saudi Arabia not only as a market for AI adoption but also as a place where AI companies can be built.

Rather than funding generic AI businesses, investors are focusing on startups that apply artificial intelligence to real economic sectors, including healthcare, logistics, education, legal technology, financial services, and industrial operations.

This reflects a broader global trend: venture capital is shifting away from standalone AI models toward companies that embed AI into industry-specific products capable of generating recurring revenues.

Industry observers expect AI to become one of Saudi Arabia's fastest-growing venture categories over the next five years, particularly as enterprise adoption accelerates across both government and private sectors.

Enterprise Software Is Quietly Becoming a Powerhouse

While fintech captures headlines, enterprise software—often delivered through Software-as-a-Service (SaaS) platforms—is steadily becoming one of Saudi Arabia's most attractive investment opportunities.

Businesses across the Kingdom are digitizing operations at an unprecedented pace, creating strong demand for cloud-based accounting systems, HR platforms, procurement software, cybersecurity solutions, compliance tools, customer relationship management systems, and workflow automation.

Unlike consumer applications, enterprise software offers predictable subscription revenues, high customer retention, and scalable business models—all characteristics highly valued by venture investors.

Saudi Arabia's ambitious digitalization of both public and private sectors provides an expanding customer base for these companies, while GCC expansion offers additional growth opportunities without requiring major product adaptation.

Healthcare Innovation Moves Into Focus

Healthcare is another sector rapidly climbing investors' priority lists.

An ageing population, increasing healthcare expenditure, and growing demand for digital medical services have accelerated investment into healthtech startups offering telemedicine, AI diagnostics, digital pharmacies, hospital management systems, and preventive care solutions.

Vision 2030's emphasis on improving healthcare quality while increasing private-sector participation has created favorable conditions for entrepreneurs addressing long-standing challenges in healthcare delivery.

Global investors increasingly recognize that healthtech represents not only a commercial opportunity but also a strategic sector aligned with government priorities.

Logistics and Supply Chain Technology

Saudi Arabia's ambition to become a global logistics hub is also reshaping venture investment.

Massive infrastructure projects—including ports, airports, industrial zones, and logistics corridors—are creating demand for technology solutions capable of improving supply-chain efficiency.

Startups developing warehouse automation, freight technology, route optimization, inventory management, and cross-border commerce platforms are benefiting from this transformation.

Investors see logistics technology as one of the sectors with the strongest long-term potential, particularly as Saudi Arabia seeks to position itself as a gateway connecting Asia, Europe, and Africa.

Climate Technology Is Beginning to Attract Institutional Capital

Although still in its early stages compared with fintech and AI, climate technology is emerging as an increasingly important investment theme.

Saudi Arabia's commitments to sustainability, renewable energy, and carbon reduction are opening opportunities for startups specializing in clean energy, water management, waste recycling, smart agriculture, energy efficiency, and environmental monitoring.

Global institutional investors, many of whom now allocate capital according to environmental, social, and governance (ESG) principles, are expected to increase exposure to climate-focused Saudi startups as the market matures.

Analysts believe climate technology could become one of the Kingdom's fastest-growing venture sectors during the second half of this decade.

Investors Are Backing Ecosystems

Perhaps the most notable change is that international investors are no longer evaluating Saudi startups in isolation. Instead, they are investing in an ecosystem that has become increasingly interconnected.

The Kingdom now offers founders access to accelerators, incubators, venture studios, sovereign-backed investment vehicles, corporate innovation programs, university research centers, and specialized entrepreneurship initiatives.

Organizations such as Monsha'at, Saudi Venture Capital Company (SVC), Sanabil Investments, and leading private VC firms—including STV, Raed Ventures, and Impact46—have helped build a financing continuum that supports companies from idea stage through late-stage expansion.

This ecosystem reduces investment risk. International funds entering Saudi Arabia today find not only ambitious founders but also stronger governance, deeper pools of local capital, more experienced management teams, and an increasingly active network of strategic partners.

As a result, many global investors are shifting from opportunistic participation in individual funding rounds to establishing long-term investment strategies focused on Saudi Arabia.

The remarkable growth of Saudi Arabia's startup ecosystem is not merely the result of larger funding rounds or more active venture capital firms. It reflects a fundamental shift in how international investors perceive the Kingdom. Saudi Arabia is no longer viewed as an emerging opportunity on the fringes of global venture capital—it is increasingly regarded as a strategic market with the potential to produce the Middle East's next generation of technology champions.

This confidence is being reinforced by a combination of demographic strength, regulatory reform, sovereign backing, and a growing pipeline of experienced entrepreneurs who have already demonstrated their ability to build and scale successful businesses.

The Rise of a Second Generation of Founders

One of the clearest indicators of a maturing startup ecosystem is the emergence of repeat entrepreneurs. In the early years of Saudi venture capital, much of the market consisted of first-time founders navigating unfamiliar territory. Today, a growing number of entrepreneurs are launching second or third ventures after successful exits or leadership roles in high-growth companies.

For investors, this significantly reduces execution risk.

Founders with prior experience typically possess stronger operational discipline, deeper industry networks, and a better understanding of fundraising, governance, and scaling. Many have also attracted senior executives from established technology companies, strengthening the overall quality of startup leadership across the Kingdom.

This evolution mirrors the development of mature ecosystems such as Silicon Valley, London, and Singapore, where experienced founders have repeatedly launched successful businesses and mentored the next generation of entrepreneurs.

Government Reforms Have Reduced Investment Risk

Another reason international capital is flowing into Saudi Arabia is the country's increasingly investor-friendly regulatory environment.

Over the past several years, the Kingdom has introduced reforms aimed at simplifying company formation, strengthening intellectual property protections, improving bankruptcy procedures, expanding digital government services, and modernizing commercial legislation. These initiatives have made it easier for both entrepreneurs and investors to establish and grow businesses.

Regulators have also introduced sector-specific frameworks that encourage innovation while providing greater legal certainty. In fintech, for example, regulatory sandboxes have enabled startups to test new financial products under the supervision of the Saudi Central Bank (SAMA) and the Capital Market Authority (CMA). Similar regulatory support is emerging in areas such as digital health, mobility, and artificial intelligence.

For international investors, these reforms reduce one of the most significant barriers to entering emerging markets: regulatory uncertainty.

Sovereign Capital Is Catalyzing Private Investment

Perhaps the most distinctive feature of Saudi Arabia's venture ecosystem is the role played by sovereign-backed institutions in mobilizing private capital.

Rather than dominating the market, entities such as the Public Investment Fund (PIF), Saudi Venture Capital Company (SVC), Jada Fund of Funds, and Sanabil Investments have focused on building a sustainable investment ecosystem. Their strategy has been to act as cornerstone investors, encouraging private venture capital firms to deploy larger amounts of capital while attracting international co-investors.

This approach has created a multiplier effect.

According to SVC, every riyal committed through its investment programs is intended to crowd in additional private-sector funding, expanding the overall pool of capital available to startups. By strengthening local venture funds and supporting international partnerships, these institutions have helped create a more resilient financing environment that extends beyond government resources.

The result is an ecosystem where sovereign capital provides confidence, while private investors drive competition, specialization, and commercial discipline.

Saudi Arabia Is Becoming the GCC's Launchpad

Historically, many startups viewed Saudi Arabia as a market to enter only after establishing themselves elsewhere in the Gulf. That dynamic has shifted dramatically.

Today, an increasing number of founders are designing their businesses around Saudi Arabia from the outset, using the Kingdom as their primary market before expanding across the GCC.

Several factors explain this change.

Saudi Arabia's large population, high consumer spending, expanding digital economy, and strong government support provide startups with an opportunity to achieve meaningful scale domestically. Once successful in Saudi Arabia, businesses can leverage that experience to enter neighboring markets such as the United Arab Emirates, Kuwait, Bahrain, Oman, and Qatar.

For investors, this creates a compelling value proposition: portfolio companies can validate their products in one of the region's largest markets before pursuing regional expansion.

The Next Wave of Capital

While venture capital investment reached record levels in 2025, most analysts believe the market is still in the early stages of its growth cycle.

Industry forecasts suggest that annual venture funding could continue rising steadily over the remainder of the decade, supported by increasing participation from global institutional investors, sovereign wealth funds, corporate venture capital arms, and family offices.

Several structural trends are expected to fuel this expansion:

• Greater adoption of artificial intelligence across industries. 
• Accelerated digitalization of financial services. 
• Expansion of enterprise software solutions. 
• Growth in healthcare innovation. 
• Increased investment in climate technologies and renewable energy. 
• Continued development of logistics and supply-chain technology. 
• Rising demand for cybersecurity solutions. 
• The commercialization of deep-tech research emerging from Saudi universities and innovation centers. 

Some analysts also expect new sectors—such as robotics, space technology, semiconductor design, and advanced manufacturing—to begin attracting meaningful venture capital before the end of the decade, particularly as the Kingdom continues investing heavily in research and industrial diversification.

What Investors Want Has Changed

Global investors are also becoming more selective.

The era of funding growth at any cost has largely given way to an emphasis on sustainable business models, profitability, and capital efficiency. International venture firms increasingly seek startups with clear revenue models, disciplined spending, and strong corporate governance.

Saudi startups appear well positioned for this environment.

Many have been built during a period characterized by tighter capital markets, forcing founders to prioritize operational efficiency from the outset. Investors often view this as an advantage compared with startups that expanded rapidly during periods of abundant global liquidity.

Increasingly, the question for investors is no longer whether Saudi Arabia can produce successful startups—it is which companies will emerge as the Kingdom's next regional and global leaders.

Can Saudi Arabia Become the Region's Startup Capital by 2030?

Saudi Arabia's startup story is no longer defined by isolated success stories or record-breaking funding rounds. Instead, it has evolved into a broader economic transformation that is reshaping the Kingdom's position in the global innovation economy. The question facing investors today is not whether Saudi Arabia will remain an attractive venture capital destination, but whether it can sustain this momentum and emerge as one of the world's leading startup ecosystems by the end of the decade.

Increasingly, market participants believe the answer is yes.

An Ecosystem Reaching Critical Mass

One of the defining characteristics of successful startup ecosystems is the ability to generate a self-reinforcing cycle of entrepreneurship. Founders build companies, successful exits create wealth, experienced entrepreneurs become angel investors or venture capitalists, and a new generation of startups benefits from both capital and expertise.

Saudi Arabia is beginning to exhibit many of these characteristics.

The Kingdom now hosts hundreds of active startups across fintech, enterprise software, healthtech, logistics, e-commerce, AI, gaming, and climate technology. More importantly, the supporting infrastructure has matured considerably. Venture capital funds, accelerators, incubators, government initiatives, universities, corporate innovation programs, and regulatory sandboxes are increasingly interconnected, creating an ecosystem capable of supporting startups from ideation through regional expansion.

This institutional maturity has become one of Saudi Arabia's greatest competitive advantages.

According to Saudi Venture Capital Company (SVC), the Kingdom ranked first in the MENA region for venture capital funding in 2025, attracting $1.72 billion across 257 deals, equivalent to approximately 45% of all venture capital deployed across the region. The report also highlighted that Saudi Arabia led MENA in both investment value and transaction volume, reflecting the breadth of activity rather than reliance on a handful of mega-rounds.

Officials See Entrepreneurship as an Economic Imperative

Saudi policymakers increasingly view startups as a strategic pillar of economic diversification rather than a niche segment of the private sector.

Officials at SVC have consistently emphasized that expanding access to venture capital is essential to increasing private-sector participation, supporting innovation, and creating high-value employment opportunities. The organization has also highlighted the importance of developing a complete financing ecosystem that supports startups across every stage of growth—from seed funding to late-stage expansion.

Similarly, Monsha'at, the Kingdom's Small and Medium Enterprises General Authority, continues to position entrepreneurship at the center of Vision 2030. Through accelerator programs, entrepreneurial support services, training initiatives, and partnerships with local and international investors, the authority aims to increase the contribution of SMEs to GDP while strengthening Saudi Arabia's competitiveness as a regional innovation hub.

These initiatives are complemented by broader government investments in digital infrastructure, artificial intelligence, cloud computing, advanced manufacturing, and logistics—all of which expand the addressable market for technology startups.

Global Investors Are Looking Beyond Fintech

Although fintech remains the dominant venture capital sector, investor interest is becoming increasingly diversified.

Artificial intelligence is widely expected to become the next major investment wave, particularly following Saudi Arabia's commitment to becoming a global AI leader. Startups applying AI to enterprise software, healthcare, education, logistics, financial services, and industrial automation are expected to attract growing interest from both regional and international investors.

Climate technology is another sector gaining momentum. As the Kingdom advances its sustainability agenda under the Saudi Green Initiative and expands renewable energy investments, venture capital is expected to flow toward startups specializing in clean energy, carbon management, water technologies, circular economy solutions, and sustainable agriculture.

Healthcare innovation, cybersecurity, logistics technology, and deep-tech ventures are also forecast to attract increasing levels of investment as digital transformation accelerates across the economy.

Market observers increasingly argue that Saudi Arabia's future venture capital landscape will be more balanced, with multiple high-growth sectors contributing to ecosystem expansion rather than a single dominant industry.

The Exit Challenge—and Opportunity

Despite the remarkable progress, one challenge continues to shape investor conversations: exits.

For venture capital firms, successful exits—whether through acquisitions, mergers, or public listings—are critical to recycling capital into new startups. While Saudi Arabia has witnessed several high-profile acquisitions and IPOs in recent years, many investors believe the next stage of ecosystem maturity will depend on increasing the frequency and scale of these liquidity events.

Encouragingly, several developments suggest that the outlook is improving.

The expansion of the Saudi capital market, growing corporate appetite for acquisitions, and increasing participation from private equity firms are expected to create more exit opportunities for venture-backed companies over the coming years. If this trend continues, it could further accelerate international investor participation by demonstrating clear pathways to returns.

A Regional Hub with Global Ambitions

Saudi Arabia's ambition extends beyond becoming the largest startup market in the Middle East. Increasingly, policymakers and investors envision the Kingdom as a global innovation hub capable of attracting entrepreneurs, talent, and capital from around the world.

Major initiatives such as NEOM, The Garage, King Abdullah University of Science and Technology (KAUST), and a growing network of venture studios and innovation districts are designed to strengthen research commercialization, attract international entrepreneurs, and foster collaboration between academia, government, and the private sector.

Combined with continued investments from sovereign institutions, these initiatives are expected to enhance Saudi Arabia's competitiveness against established innovation centers in Europe, Asia, and North America.

While forecasting venture capital flows is inherently uncertain, the underlying fundamentals suggest that Saudi Arabia's startup ecosystem is positioned for sustained expansion.

A large domestic market, supportive public policy, sophisticated institutional investors, improving regulatory frameworks, and a growing pool of experienced entrepreneurs provide a strong foundation for future growth. As more international funds establish dedicated MENA strategies—and increasingly view Saudi Arabia as the region's anchor market—the Kingdom is likely to capture an even larger share of global venture capital directed toward emerging markets.

The coming years will undoubtedly present challenges. Global economic volatility, shifting monetary policy, geopolitical developments, and increased competition for capital will continue to influence investment decisions. Yet the resilience demonstrated by Saudi Arabia's startup ecosystem during periods of global uncertainty has strengthened investor confidence rather than weakened it.

To conclude, just a decade ago, Saudi Arabia was largely absent from conversations about global venture capital. Today, it stands at the center of the Middle East's innovation economy, attracting record levels of investment and producing startups capable of competing on a regional—and increasingly international—stage.

The Kingdom's transformation is being driven by more than capital. It reflects a deliberate strategy to build an ecosystem where entrepreneurs, investors, regulators, universities, and corporations work together to create long-term economic value.

For global investors, Saudi Arabia is no longer simply a promising frontier market. It is becoming a strategic destination where scale, policy support, technological adoption, and entrepreneurial ambition converge.

If the current trajectory continues, the next decade may not simply be remembered as the period when Saudi Arabia became the Middle East's largest startup ecosystem—it may be remembered as the decade when the Kingdom emerged as one of the world's most influential centers for innovation and venture capital.

Ghada Ismail

Behind every successful startup lies an unspoken goal. It's not simply raising another funding round or achieving unicorn status; it's creating an opportunity for founders and investors to realize the value they've spent years building. In the startup world, that milestone is called a liquidity event. Whether through an acquisition, an IPO, or a secondary share sale, a liquidity event turns paper wealth into real financial returns. Understanding how it works helps founders make smarter decisions long before an exit is on the horizon.

What Is a Liquidity Event?

A liquidity event is any transaction that allows founders, investors, or employees to convert their ownership in a startup into cash or other liquid assets.

Private startup shares are typically illiquid, meaning they cannot be easily sold because they are not traded on a public market. A liquidity event unlocks that value, allowing shareholders to monetize their equity.

Why It Matters

Liquidity events reward the people who helped build the company. Founders receive compensation for years of risk-taking, employees can benefit from stock options, and investors generate returns that can be reinvested into new ventures.

They also fuel the broader startup ecosystem by encouraging venture capital, creating successful entrepreneurs, and attracting fresh investment.

Common Types of Liquidity Events

Acquisition

The most common startup liquidity event is an acquisition, where another company buys the business for cash, shares, or both. Many successful startups—including Instagram, WhatsApp, and YouTube—reached liquidity through acquisitions rather than public listings.

Initial Public Offering (IPO)

An IPO occurs when a private company lists on a stock exchange. Existing shareholders can eventually sell their shares, while the company gains access to public capital. However, IPOs also bring stricter regulations and greater scrutiny.

Secondary Share Sale

Founders or early investors may sell part of their shares to new investors during later funding rounds without selling the entire company. These transactions provide partial liquidity while allowing the startup to continue growing independently.

Management Buyout or Private Equity Sale

Although less common for startups, a liquidity event can also happen when the company's management team or a private equity (PE) firm buys the business from its existing shareholders.

In a management buyout (MBO), the people already running the company—such as its executives or senior managers—purchase the business and become its new owners. In a private equity sale, an investment firm acquires the company with the goal of growing its value before eventually selling it or taking it public.

In both cases, founders and early investors can sell their shares and receive cash, while the company continues to operate as a privately owned business. This type of liquidity event is more common among mature, profitable companies than early-stage startups.

Liquidity Event vs. Exit

Although often used interchangeably, the two terms are different.

An exit usually means founders or investors leave the business through a sale or IPO. A liquidity event simply means converting equity into cash. A founder who sells only part of their stake experiences liquidity without making a full exit.

Preparing for a Liquidity Event

Successful liquidity events are built years in advance. Startups should maintain clean financial records, strengthen corporate governance, protect intellectual property, and build scalable, predictable businesses. Strong preparation makes due diligence easier and often leads to higher valuations.

To Wrap Things Up…

A liquidity event is more than a payday; we can safely say it's the moment when years of building a startup translate into real financial value. Whether through an acquisition, an IPO, or a secondary share sale, it marks a major milestone for founders, investors, and employees alike. Understanding liquidity events early can help entrepreneurs make better decisions about fundraising, equity, and long-term growth.

Kholoud Hussein 

Entrepreneurship is often portrayed as a one-size-fits-all journey—an ambitious founder develops an idea, secures funding, launches a startup, and scales it into a successful business. In reality, however, entrepreneurs come in many forms, each driven by different motivations, risk appetites, and long-term ambitions. While some are determined to build the next billion-dollar company, others are passionate about solving local challenges, creating social impact, or simply achieving financial independence.

Understanding your entrepreneurial personality is more than an exercise in self-awareness. It can help you choose the right business model, attract suitable investors, build an effective team, and make strategic decisions that align with your vision. As global startup ecosystems continue to mature—particularly across the Middle East, where entrepreneurship is becoming a cornerstone of economic diversification—recognizing your entrepreneurial type has never been more important.

1. The Innovator

Innovators are the entrepreneurs who redefine industries. They introduce groundbreaking products, disruptive technologies, or entirely new business models that challenge the status quo. Rather than improving existing solutions, they focus on creating something the market has never seen before.

These entrepreneurs are naturally curious, highly creative, and willing to take calculated risks. They often invest significant time and resources in research and development before bringing their ideas to market.

Strengths:

• Visionary thinking
• High growth potential
• Ability to create new markets

Challenges:

• Long development cycles
• High capital requirements
• Greater market uncertainty

Think of founders behind revolutionary technologies such as artificial intelligence platforms, biotech companies, or next-generation fintech solutions.

2. The Scalable Startup Founder

This is the entrepreneur most associated with the startup ecosystem. Their goal is rapid growth, often backed by venture capital, with ambitions to expand across regions—or even globally.

Scalable founders prioritize technology, automation, and repeatable business models. They continuously measure growth metrics, customer acquisition costs, and revenue scalability.

These entrepreneurs thrive in sectors such as SaaS, fintech, healthtech, logistics, and e-commerce.

Success is measured by:

• Market expansion
• Investment rounds
• Revenue growth
• Exit opportunities through acquisitions or IPOs

3. The Lifestyle Entrepreneur

Not every entrepreneur dreams of becoming the next unicorn founder. Lifestyle entrepreneurs build businesses that support the life they want rather than allowing the business to define their lives.

Many freelancers, consultants, digital creators, coaches, and boutique agency owners fall into this category. Their priorities often include flexibility, autonomy, and sustainable income instead of aggressive expansion.

While these businesses may never seek institutional investment, they can generate consistent profitability and long-term stability.

4. The Social Entrepreneur

For social entrepreneurs, profit is only part of the equation. Their primary mission is solving societal or environmental challenges while maintaining a financially sustainable organization.

Whether addressing education gaps, healthcare accessibility, food security, renewable energy, or financial inclusion, these founders measure success by both financial performance and social impact.

With governments increasingly supporting ESG initiatives and sustainable development, social entrepreneurship is becoming a major contributor to modern economies.

5. The Small Business Entrepreneur

Small business entrepreneurs represent the backbone of every economy. They establish businesses that primarily serve local communities, including restaurants, retail stores, manufacturing firms, professional services, and family-owned enterprises.

Unlike venture-backed startups, these businesses generally rely on personal savings, bank financing, or traditional lending rather than external equity investment.

Although they may not dominate headlines, small businesses collectively generate millions of jobs and contribute significantly to GDP across developed and emerging markets alike.

6. The Corporate Entrepreneur (Intrapreneur)

Entrepreneurship does not always require starting a company from scratch. Corporate entrepreneurs—or intrapreneurs—drive innovation from within established organizations.

They develop new products, launch business units, improve operational processes, and identify growth opportunities while leveraging the company's existing resources.

Many successful innovations have originated from employees who were encouraged to think and act like entrepreneurs inside large corporations.

7. The Acquisition Entrepreneur

Rather than creating a business from zero, acquisition entrepreneurs purchase existing businesses and improve their operations.

Their expertise lies in identifying undervalued companies, streamlining operations, expanding customer bases, and increasing profitability before holding or selling the business.

This model has gained popularity among experienced investors and entrepreneurs looking for lower startup risk compared to launching a new venture.

8. The Serial Entrepreneur

Some entrepreneurs simply love building companies. Once they achieve success—or even after experiencing failure—they move on to launch another venture.

Serial entrepreneurs accumulate valuable experience, extensive networks, and operational expertise across multiple industries. Their previous successes often make it easier to attract investors, recruit talent, and enter new markets.

Many of today's most influential founders have built several companies throughout their careers rather than dedicating themselves to a single business.

Which Entrepreneur Are You?

Most founders don't fit neatly into one category. A startup founder may begin as an innovator, evolve into a scalable entrepreneur after attracting investors, and eventually become a serial entrepreneur following a successful exit. Likewise, a lifestyle entrepreneur may discover an opportunity that transforms a small business into a high-growth company.

Your entrepreneurial identity also changes as markets evolve. Economic shifts, technological advances, access to funding, and customer demand can all influence how you build and grow your business.

The key is understanding your priorities. Are you motivated by rapid expansion or long-term independence? Do you seek financial returns, social impact, or industry disruption? Your answers will shape everything from your funding strategy to your hiring decisions.

Finally, there is no universally "best" type of entrepreneur. Every entrepreneurial path contributes differently to economic growth, innovation, and job creation. While venture-backed startups often attract the spotlight, local businesses, social enterprises, corporate innovators, and lifestyle entrepreneurs all play essential roles in building resilient economies.

Ultimately, successful entrepreneurship is not about following someone else's blueprint—it's about understanding your own strengths, ambitions, and definition of success. The entrepreneurs who thrive are those who build businesses that align with their vision, adapt to changing markets, and create lasting value for customers, investors, employees, and society.

Noha Gad

In a world where every purchase, partnership, and policy is increasingly visible, the way investors invest carries more weight than ever. Money is no longer just a tool for growth; it is a statement of what we believe in and the future we want to build. For decades, investing was framed as a simple trade-off: maximize returns, and leave ethics at the door. Today, that narrative is crumbling. Across global markets, investors are asking a different question: How can I grow my wealth without compromising my values?

This shift is not only moral; it is strategic. Companies that ignore environmental risks, social expectations, or governance standards are increasingly exposed to scandals, regulation, and reputational damage. At the same time, businesses leading in sustainability, innovation, and responsible practices are positioning themselves for long-term resilience.

Ethical investing sits at the heart of this transformation. It is the practice of aligning investment decisions with moral, social, and sometimes religious principles, while pursuing sound financial returns. 

What is meant by ethical investing?

Ethical investing is an investment strategy where the investor’s ethical values are the primary objective, along with good returns. With suspicious and illegal investment deals on the rise, many investors are starting to insist that companies they invest in are socially responsible. This means treating their employees with respect, creating healthy products and services, and keeping away from unethical business practices.

Types of ethical investing

Ethical investing is not a single strategy; it is a family of approaches that help investors align their portfolios with their values. Each type uses different tools to direct capital toward what the investor considers “good” and away from what they consider harmful. Key types are:

• Socially Responsible Investing Funds (SRI Funds). This type avoids investing in controversial areas such as gambling, firearms, tobacco, alcohol, and oil. They focus on moral and social values, often with an emphasis on avoiding harm.
• Environmental, Social and Governance Funds (ESG Funds). Unlike SRI funds, ESG funds consider in their decision-making how environmental, social and governance risks and opportunities can cause material impacts on a company’s performance. They typically evaluate carbon emissions, water usage, and climate risk; assess employee treatment, diversity, and community relations; and review board structure, executive pay, and transparency.
• Impact Funds. This type of fund places equal importance on fund performance. Hence, they aggressively focus on creating ethical changes and supporting companies that provide certain products and services. Impact funds are suitable for investors who are socially responsible but also want good returns.
• Faith-based Funds. Faith-based funds only invest in stocks that follow religious values and ideals, and strictly exclude investments that don’t fit the category.

Advantages And Disadvantages

Ethical investing offers meaningful benefits, but it also comes with trade-offs. Understanding both sides helps you decide whether it fits your goals and how to design your portfolio wisely. Major benefits are:

• Alignment with personal values: Ethical investing lets investors direct capital toward companies and projects that reflect their moral and social beliefs.
• Potential for long-term performance: Companies with strong ESG practices are often better managed and less exposed to scandals, which can support stable earnings and competitive returns over time.
• Risk mitigation: Screening out firms with poor environmental, social, or governance practices can reduce exposure to lawsuits, fines, and reputational damage. 
• Positive social and environmental impact: Ethical investing channels money into areas like clean energy, fair labor, healthcare, and education, contributing to broader societal goals.

Disadvantages

• Limited Investments: Excluding certain sectors narrows investors’ options, which can reduce diversification and potentially limit returns. Avoiding entire industries may mean missing out on profitable opportunities in specific market conditions.
• Potential for lower returns: Ethical funds may underperform in periods when excluded sectors outperform, as they prioritize values over maximum profit.
• Higher costs and fees: Specialized research and active management often lead to higher fees compared to standard index funds. These costs can erode net returns, especially in smaller or niche ethical funds. 
• More research and due diligence: Ethical investing demands extra effort to verify that holdings align with your values, requiring time and expertise. This can be a barrier for investors who prefer simpler, passive strategies.

Finally, ethical investing is a fundamental shift in how capital is allocated in a transparent, interconnected world. It offers a powerful way to align your financial goals with your values, support responsible businesses, and potentially reduce long-term risks. By understanding the strategies, benefits, and limitations, investors can build a portfolio that reflects who they are and the future they want to support, without abandoning sound financial principles.

Ghada Ismail

Media buying has come a long way from negotiating television spots, newspaper placements, and billboard locations. Today, it is a data-driven discipline powered by artificial intelligence (AI), automation, audience analytics, and real-time optimization. Brands are no longer simply buying advertising space; instead, they are investing in technologies and strategies that ensure their marketing investment reaches the right audience at the right time.

This transformation is reshaping advertising markets worldwide, and Saudi Arabia is no exception. As businesses accelerate their digital transformation under Vision 2030, advertisers are demanding smarter, faster, and more measurable campaigns. In response, a new generation of Saudi companies is redefining media buying by combining technology, creativity, and data-driven decision-making.

While the term "AdTech" is often associated with software platforms and AI-powered advertising tools, Saudi Arabia's evolving media buying ecosystem extends beyond startups developing proprietary technology. It also includes agencies that integrate digital marketing, analytics, creative strategy, and campaign optimization into comprehensive media buying services. Together, these companies are helping brands navigate an increasingly complex advertising landscape.

Media Buying Has Become a Technology Business

The rise of digital platforms has fundamentally changed the role of media buyers. Instead of manually selecting where advertisements should appear, marketers now rely on sophisticated tools that analyze audience behavior, measure campaign performance, and automate bidding across multiple advertising channels.

Programmatic advertising has become a cornerstone of modern media buying, allowing advertisers to purchase digital inventory in milliseconds using automated auctions. AI algorithms continuously evaluate campaign performance, optimize budgets, and identify high-performing audiences, enabling businesses to maximize return on investment while reducing wasted advertising spend.

This shift has transformed media buying from a transactional activity into a strategic business function. Success is no longer measured solely by how many people see an advertisement, but by how effectively campaigns generate engagement, conversions, and long-term customer value.

Why Saudi Arabia Is Ripe for Innovation

Saudi Arabia's rapidly expanding digital economy has created fertile ground for innovation in advertising and media buying. The Kingdom boasts one of the highest internet and smartphone penetration rates in the region, while social media platforms have become central to consumer engagement and purchasing decisions.

At the same time, the government is encouraging businesses across sectors to embrace digital transformation, increasing demand for sophisticated marketing solutions. As companies compete for consumer attention in an increasingly crowded online environment, they require partners capable of combining media planning, creative storytelling, data analytics, and performance measurement into integrated campaigns.

This growing demand has opened opportunities for Saudi agencies to move beyond traditional advertising and adopt technology-driven approaches that improve campaign efficiency and accountability.

How Saudi Companies Are Reinventing Media Buying

Saudi Arabia's media buying ecosystem is evolving through companies that blend strategic planning with digital innovation, helping brands reach audiences across multiple channels while delivering measurable business outcomes.

Bassmat is among the agencies reflecting this evolution. As an integrated marketing communications company, it offers media planning and buying alongside services such as digital strategy, search engine optimization, social media management, public relations, and campaign analytics. Rather than treating media buying as an isolated service, Bassmat positions it within a broader communications strategy that allows brands to coordinate messaging across digital and traditional platforms.

A similar integrated approach can be seen at True Vision (TrueVS), which focuses on digital marketing and performance-driven campaigns. By combining media buying with branding, creative development, audience targeting, and digital strategy, the agency helps businesses optimize advertising investments based on measurable results instead of impressions alone. This reflects a wider industry shift toward performance marketing, where campaign success is evaluated through conversions, customer acquisition, and return on investment.

Lenzo demonstrates how media buying is expanding beyond digital advertising into experiential marketing. The agency specializes in brand activations, exhibitions, events, and immersive experiences that connect physical engagement with digital promotion. As brands increasingly seek omnichannel marketing strategies, companies like Lenzo illustrate how media buying now extends across multiple consumer touchpoints, creating campaigns that bridge online and offline experiences.

Meanwhile, Tech Wave highlights the growing convergence between technology consulting and marketing services. Known for its expertise in software development and digital transformation, the company also provides digital marketing solutions that leverage technology to improve campaign effectiveness. This reflects a broader trend in which media buying increasingly relies on technological capabilities, including automation, analytics, and digital infrastructure, rather than creative execution alone.

Although these companies operate with different business models, they share a common objective: helping advertisers make smarter decisions using technology, customer insights, and integrated marketing strategies.

AI Is Changing the Rules

Artificial intelligence is becoming one of the most influential forces shaping the future of media buying. AI-powered tools can analyze vast amounts of consumer data, predict purchasing behavior, identify the most valuable audience segments, and continuously optimize campaigns while they are running.

Instead of relying on historical performance alone, advertisers can now adjust budgets in real time, personalize advertising messages, and automate routine campaign management tasks. These capabilities improve efficiency while enabling marketing teams to focus on strategy and creativity.

For agencies, AI is not replacing human expertise but enhancing it. Success increasingly depends on combining technological capabilities with market knowledge, creative thinking, and a deep understanding of consumer behavior.

What Comes Next?

Saudi Arabia's media buying industry is expected to keep evolving as more businesses invest in digital transformation and online advertising. To stay competitive, agencies will continue adopting new technologies such as AI-powered analytics, smarter audience targeting, creator marketing, and integrated campaigns that run across multiple platforms.

The advertising industry is also adapting to growing privacy expectations. As third-party cookies become less common, brands are placing greater value on first-party data collected directly from their own customers. Agencies that can help businesses use this data effectively while still reaching the right audiences are likely to have a competitive advantage.

Generative AI is also set to play a bigger role in media buying. It can help agencies create content faster, identify the best audience segments, and optimize campaigns more efficiently. While AI will automate some routine tasks, it is unlikely to replace marketing professionals. Instead, it will make human creativity and strategic thinking even more valuable, allowing agencies to deliver smarter and more effective campaigns.

Conclusion

Media buying is no longer simply about purchasing advertising space. It has become a multidisciplinary practice where technology, creativity, analytics, and customer experience work together to deliver measurable business outcomes.

Saudi Arabia's media buying industry reflects this transformation. While innovation is often associated with AdTech platforms, the Kingdom's broader ecosystem of marketing agencies is also playing a critical role in modernizing how brands reach consumers. Companies such as Bassmat, TrueVS, Lenzo, and Tech Wave demonstrate that successful media buying increasingly depends on integrating strategic planning, digital expertise, and technology into every stage of the advertising journey.

As Saudi Arabia continues building a digital-first economy, the organizations that combine innovation with measurable performance will help define the next chapter of the Kingdom's advertising industry, one where media buying is not just about visibility, but about delivering meaningful business results.

Kholoud Hussein 

In the world of entrepreneurship, the strength of an economy is not measured solely by the number of companies it creates, but by the number it can help survive when adversity strikes. Financial distress is no longer an exception in today's business landscape; it has become an inevitable phase in the corporate lifecycle, particularly for startups navigating volatile markets, tightening funding conditions, rising operating costs, and rapidly evolving customer demands.

For decades, bankruptcy carried a deeply negative connotation across much of the Middle East. It was widely perceived as the final chapter in a company's journey—an admission of failure that inevitably led to liquidation, reputational damage, and prolonged legal disputes. That perception, however, has begun to change in Saudi Arabia with the introduction of the Kingdom's Bankruptcy Law, legislation that fundamentally redefines bankruptcy not as the end of a business, but as an opportunity to preserve one.

More than a legal reform, the law represents a shift in economic philosophy. It aligns closely with the ambitions of Saudi Vision 2030, which seeks to build a diversified, competitive, and resilient economy capable of encouraging innovation while managing business risks more effectively. Rather than forcing financially distressed companies into immediate liquidation, the framework allows viable businesses to restructure their obligations, reorganize their finances, and continue operating—preserving jobs, protecting creditors' rights, and maintaining economic value.

For startups, this legal framework has become one of the defining characteristics of a mature entrepreneurial ecosystem. Venture capitalists understand that innovation inherently involves uncertainty, and that not every business succeeds on its first attempt. What matters is not eliminating risk altogether, but creating mechanisms that allow promising companies to recover from temporary setbacks. By providing those mechanisms, Saudi Arabia has taken an important step toward strengthening investor confidence and encouraging greater capital deployment across its growing startup ecosystem.

From Punishment to Business Recovery

Saudi Arabia's Bankruptcy Law, enacted under Royal Decree No. M/50 in 2018, marked a turning point in the Kingdom's commercial legal framework. Replacing outdated insolvency provisions that were no longer suited to the needs of a rapidly diversifying economy, the law introduced internationally recognized restructuring principles while adapting them to Saudi Arabia's legal and economic environment.

At its core lies a simple but transformative principle: financial distress does not necessarily mean a business has reached the end of its life cycle. Many companies experience temporary liquidity shortages, operational disruptions, or financing challenges that can be overcome through restructuring rather than liquidation.

To address varying degrees of financial distress, the law establishes several judicial procedures, each designed to preserve economic value whenever possible. These include:

• Preventive Settlement, allowing debtors to negotiate repayment agreements with creditors before insolvency escalates. 
• Financial Restructuring, enabling companies to reorganize their debts while continuing day-to-day operations under court supervision. 
• Liquidation, which remains the final option when a business is no longer economically viable. 

This graduated approach represents a fundamental departure from traditional insolvency regimes. Instead of treating bankruptcy as a legal penalty, the Saudi framework views it as a structured process aimed at business recovery whenever feasible.

Why Startups Stand to Benefit the Most

No segment of the economy illustrates the importance of such legislation better than startups.

Globally, the majority of startups encounter cash flow challenges during their early years—not because their products lack potential, but because they often expand rapidly, depend heavily on external financing, and require years before achieving profitability. Market fluctuations, delayed fundraising rounds, changing investor sentiment, or unexpected economic shocks can quickly place otherwise promising companies under financial pressure.

Saudi Arabia's startup ecosystem has expanded significantly over the past decade. Government-backed initiatives, venture capital funds, accelerators, incubators, and regulatory reforms have fueled rapid growth across sectors such as fintech, e-commerce, digital health, artificial intelligence, logistics, and enterprise software.

As the ecosystem matures, financial distress becomes an inevitable reality for some companies. The critical question is no longer whether businesses will encounter challenges—but whether the legal environment enables them to recover.

Unlike traditional businesses whose value often lies in physical assets, startups derive much of their worth from intangible assets: proprietary technology, software platforms, intellectual property, customer relationships, data, and brand equity. Immediate liquidation frequently destroys much of that value. Restructuring, by contrast, preserves these assets while allowing management to stabilize operations and pursue long-term recovery.

Equally important, the Bankruptcy Law provides distressed businesses with breathing space. Under judicial supervision, companies can negotiate with creditors, suspend certain enforcement actions, and develop restructuring plans without the immediate threat of business closure. This period often proves critical in restoring liquidity and rebuilding operational stability.

Investors Fear Uncertainty More Than Failure

Contrary to popular belief, bankruptcy legislation does not encourage reckless business behavior. In reality, sophisticated investors have never expected every startup to succeed.

The venture capital model itself is built on the assumption that only a small percentage of portfolio companies will generate extraordinary returns, compensating for the inevitable failures elsewhere. Failure, therefore, is already priced into the investment equation.

What investors fear is not failure itself, but uncertainty surrounding failure.

When insolvency procedures are unclear, recovery mechanisms are weak, and creditor rights are poorly defined, investment risk increases substantially. Conversely, transparent bankruptcy frameworks reduce uncertainty by establishing predictable legal pathways for debt restructuring, creditor negotiations, and business continuation.

This is precisely why insolvency reform has become an important indicator of a country's investment climate. International institutions and legal experts consistently regard efficient restructuring frameworks as essential components of business-friendly economies because they improve legal certainty, facilitate capital allocation, and reduce systemic financial risk.

Saudi Arabia's Bankruptcy Law forms part of a broader package of economic reforms designed to improve the Kingdom's ease of doing business, strengthen investor protection, and position Saudi Arabia as one of the region's leading destinations for entrepreneurship and foreign investment.

When Financial Distress Becomes Part of the Growth Story

Some of the world's most recognizable companies demonstrate why restructuring laws matter.

During the 2008 global financial crisis, General Motors underwent one of the largest corporate restructurings in history. Rather than disappearing, the company successfully reorganized its operations, emerged from bankruptcy protection, and returned to profitability.

More recently, WeWork, once considered one of the world's fastest-growing startups, entered restructuring proceedings after facing mounting debt and declining valuations. Instead of immediately ceasing operations, the company used the legal framework to renegotiate obligations, reduce costs, and reposition its business model.

Similarly, LATAM Airlines, severely affected by the COVID-19 pandemic, utilized restructuring procedures to reorganize billions of dollars in liabilities while maintaining operations across Latin America before ultimately emerging with a stronger financial foundation.

These cases do not suggest that every financially distressed company can—or should—be saved. Rather, they demonstrate that modern bankruptcy laws seek to distinguish between businesses that have become fundamentally unviable and those suffering from temporary financial challenges. For the latter, restructuring protects enterprise value, preserves employment, and often delivers better outcomes for creditors than immediate liquidation.

Saudi Arabia's Bankruptcy Law embraces this same philosophy by recognizing that preserving a viable business frequently creates greater economic value than dismantling it.

Changing the Culture Around Failure

Perhaps the greatest impact of Saudi Arabia's Bankruptcy Law extends beyond the courtroom.

Its true significance lies in reshaping how entrepreneurs, investors, lenders, and society perceive business failure.

In the world's most innovative economies, failed entrepreneurs are rarely viewed as permanent failures. Instead, they are often regarded as individuals who have accumulated valuable experience that increases their chances of succeeding in future ventures.

By contrast, where bankruptcy carries social stigma or severe legal consequences, entrepreneurs may delay seeking help until recovery becomes impossible.

Saudi Arabia's framework encourages earlier intervention. Rather than waiting until a company has exhausted every option, the law incentivizes businesses to pursue preventive settlements and financial restructuring before financial distress becomes irreversible.

As Saudi Arabia continues to accelerate its transition toward a knowledge-based economy, this cultural transformation may prove just as important as the legal reform itself. A thriving startup ecosystem is not one in which companies never fail; it is one in which innovative businesses are given every reasonable opportunity to recover, adapt, and create value once again.

Building Confidence Through a Culture of Business Recovery

The true success of a bankruptcy framework is rarely measured by the number of companies that enter its procedures. Instead, it is measured by whether entrepreneurs, investors, lenders, and the wider business community develop sufficient confidence to use it before financial distress becomes irreversible. In Saudi Arabia, that confidence has been steadily building since the Bankruptcy Law came into force, reflecting a broader transformation in how financial distress is perceived within one of the Middle East's fastest-growing entrepreneurial ecosystems.

For decades, insolvency was often associated with corporate failure, reputational damage, and the inevitable dissolution of a business. Companies experiencing liquidity shortages frequently delayed seeking legal protection, hoping that market conditions would improve or additional financing would materialize. By the time many businesses acknowledged the severity of their financial challenges, recovery had become significantly more difficult, leaving liquidation as the only viable option.

Saudi Arabia's Bankruptcy Law seeks to reverse that pattern. Rather than encouraging companies to wait until collapse is unavoidable, the legislation promotes early intervention, allowing businesses to negotiate with creditors while they remain operational and economically viable. This subtle shift in timing has profound implications. A company that enters restructuring before exhausting its resources stands a far greater chance of preserving jobs, protecting supplier relationships, safeguarding intellectual property, and ultimately returning to sustainable growth.

The growing acceptance of this philosophy is becoming increasingly evident. According to data released by the Saudi Bankruptcy Commission, bankruptcy applications have continued to rise over recent years—not because more businesses are necessarily failing, but because awareness of the legal framework has expanded among companies, financial advisers, and creditors. More importantly, a growing proportion of these filings involve Preventive Settlement and Financial Restructuring procedures rather than liquidation, suggesting that businesses are increasingly viewing the law as a mechanism for recovery instead of a final exit from the market.

This distinction is particularly important for startups. Young, high-growth companies operate under financial dynamics that differ significantly from those of traditional businesses. Rapid expansion often requires substantial upfront investment, while revenues may take years to reach levels capable of supporting profitability. During this period, startups remain highly sensitive to changes in funding conditions, shifts in investor sentiment, supply chain disruptions, or unexpected economic shocks. Financial distress, therefore, is not always a reflection of poor management or a flawed business model; it is often a consequence of the inherently uncertain nature of innovation.

The venture capital industry has long understood this reality. Professional investors rarely expect every company within their portfolios to succeed. In fact, the venture capital model is built upon the assumption that only a relatively small number of investments will generate exceptional returns capable of offsetting losses elsewhere. Failure, therefore, is not an anomaly—it is embedded within the economics of innovation itself.

What concerns investors is not the possibility that a startup may struggle, but the absence of predictable legal mechanisms to manage those struggles. Every investment decision incorporates an assessment of institutional risk alongside commercial potential. Investors want to know how creditor claims will be handled, whether management can continue operating during restructuring, how quickly courts can resolve disputes, and whether enterprise value can be preserved while financial obligations are reorganized.

In this context, Saudi Arabia's Bankruptcy Law performs an important function beyond corporate recovery. It reduces uncertainty.

Legal certainty has become one of the defining characteristics separating mature investment destinations from emerging markets. Countries capable of providing transparent restructuring procedures, efficient judicial oversight, and balanced protection for both debtors and creditors generally attract greater volumes of long-term investment because they offer investors confidence that business risks can be managed within a predictable legal environment.

This institutional maturity has become increasingly important as Saudi Arabia's venture capital market continues its rapid expansion. Over the past several years, the Kingdom has consistently ranked among the largest recipients of venture capital investment in the Middle East and North Africa, supported by government initiatives, sovereign-backed investment vehicles, corporate venture funds, and an increasingly active private investment community. The growing number of technology startups operating across fintech, artificial intelligence, logistics, digital health, retail technology, and enterprise software demonstrates the remarkable pace at which the entrepreneurial landscape is evolving.

Yet every mature startup ecosystem eventually reaches a point where supporting successful companies alone is no longer sufficient. It must also develop sophisticated mechanisms for managing unsuccessful ones.

This is where bankruptcy legislation assumes strategic importance.

Modern innovation economies recognize that preserving viable businesses often creates significantly greater economic value than liquidating them. Startups rarely derive their worth from factories, machinery, or real estate. Their greatest assets are typically intangible: proprietary software, patented technologies, customer databases, algorithms, digital platforms, data assets, intellectual property, and highly specialized human capital. These assets frequently lose much of their value when companies are dismantled through liquidation.

Restructuring offers an alternative. By allowing companies to continue operating while negotiating revised financial obligations, bankruptcy procedures preserve the knowledge, innovation, and commercial relationships that have often taken years to build. Employees remain productive, customers continue receiving services, suppliers retain business relationships, and investors maintain the possibility of recovering value from their investments.

The international experience provides compelling evidence of this approach. Some of today's most recognizable companies owe their continued existence not to uninterrupted commercial success, but to legal systems capable of facilitating corporate recovery.

The restructuring of General Motors during the global financial crisis remains one of the most widely studied examples of modern corporate rehabilitation. Faced with unprecedented financial losses, the automotive giant reorganized its operations through court-supervised restructuring rather than outright liquidation, enabling the company to preserve industrial capacity, protect thousands of jobs, and eventually regain profitability.

More recently, WeWork's highly publicized restructuring demonstrated that even companies once celebrated as symbols of innovation can experience severe financial distress. Rather than disappearing entirely, the company utilized bankruptcy procedures to renegotiate leases, reduce debt, streamline operations, and reposition itself within a changing commercial environment. Likewise, LATAM Airlines emerged from one of the aviation industry's largest restructurings after reorganizing billions of dollars in liabilities while maintaining operations during the COVID-19 pandemic.

These examples should not be interpreted as evidence that every struggling business deserves rescue. Bankruptcy laws are not designed to preserve companies that lack viable business models or sustainable market demand. Instead, they are intended to distinguish between temporary financial distress and permanent commercial failure—a distinction that is essential in economies driven by innovation, where early-stage companies often require time to transform promising ideas into profitable enterprises.

Perhaps the most significant impact of Saudi Arabia's Bankruptcy Law, however, extends beyond legal procedure and financial restructuring. It is gradually reshaping the culture surrounding entrepreneurship itself.

In many established innovation hubs, including Silicon Valley, entrepreneurial failure is often regarded as an educational experience rather than a permanent stigma. Investors frequently back founders who have previously experienced unsuccessful ventures, recognizing that practical experience acquired through failure can improve leadership, operational discipline, and strategic decision-making in future businesses.

Historically, many entrepreneurs across emerging markets have operated under very different assumptions. The social and legal consequences traditionally associated with insolvency often encouraged founders to conceal financial problems rather than address them openly. This reluctance frequently delayed restructuring efforts until recovery was no longer possible.

Saudi Arabia's evolving legal framework encourages precisely the opposite behavior. By providing structured pathways for preventive settlement and financial restructuring, it incentivizes earlier dialogue between businesses and creditors, increasing the likelihood that viable companies can recover before financial deterioration becomes irreversible.

This cultural evolution aligns closely with the broader objectives of Vision 2030. Economic diversification depends not only on encouraging entrepreneurs to establish companies but also on creating institutions capable of supporting businesses throughout every stage of their development—from incorporation and fundraising to expansion, restructuring, acquisition, and, where necessary, an orderly exit from the market. In that sense, the Bankruptcy Law complements a much wider program of commercial reforms designed to strengthen investor confidence, modernize the judicial system, improve the business environment, and position Saudi Arabia as one of the region's leading destinations for entrepreneurship and innovation.

Ultimately, the Bankruptcy Law is not simply legislation governing financial distress. It is an institutional signal that Saudi Arabia has embraced a more sophisticated understanding of how modern economies grow. Innovation requires ambition, ambition inevitably involves risk, and risk occasionally leads to failure. Sustainable entrepreneurial ecosystems are therefore built not on the unrealistic expectation that companies will never fail, but on the confidence that when viable businesses encounter temporary setbacks, the legal system provides them with a genuine opportunity to recover.

That may prove to be one of the Kingdom's most important competitive advantages in the years ahead. As Saudi Arabia continues to attract entrepreneurs, venture capital, and technology investment from around the world, its Bankruptcy Law serves as a reminder that resilient economies are not defined by the absence of failure—they are defined by their ability to transform failure into a foundation for future growth.

Ghada Ismail

Imagine a startup that has been around for six years; it has an office, a team of employees, and a product with a loyal customer base. Every few months, it announces a new feature. Every year, it raises just enough funding to keep operating.

At first glance, everything seems fine, but behind the scenes, revenue hasn't grown in years. Investors have stopped asking about the next funding round. The founders spend more time extending the company's runway than planning its future. The dream of becoming the next unicorn has quietly been replaced by a much simpler goal: surviving another quarter.

The startup isn't thriving, but it isn't dead either; this is what economists call a Zombie Startup.

What Is a Zombie Startup?

A zombie startup is a company that continues operating despite losing its growth trajectory. It generates enough revenue—or raises just enough funding—to cover expenses, but not enough to scale, attract major investors, or become a market leader.

Think of it as a car with the engine running but stuck in traffic. It's still moving, but it's not getting any closer to its destination.

Unlike a failed startup, a zombie startup hasn't shut down. Customers still use its product, employees still come to work, and the founders haven't given up. The problem is that the business has become trapped in survival mode. Growth has stalled, innovation has slowed, and every decision is focused on staying alive rather than moving forward.

How Does a Startup Become a Zombie?

Zombie startups rarely appear overnight. Instead, they gradually lose momentum.

One common reason is weak product-market fit. The product solves a problem, but not one that enough customers are willing to pay for. As demand slows, so does growth.

Scaling too early is another frequent mistake. Hiring aggressively, expanding into new markets, or overspending on marketing before validating the business model can quickly drain cash.

Competition can also take its toll. Larger rivals often have stronger brands, deeper pockets, and more resources to improve their products, making it difficult for smaller startups to keep pace.

Sometimes, however, the biggest obstacle is emotional. Founders become deeply attached to the company they've built. Rather than making difficult decisions—such as pivoting, downsizing, or even shutting down—they continue operating in the hope that things will eventually improve.

Warning Signs You Shouldn't Ignore

Zombie startups don't suddenly stop growing. Their decline is usually slow, making it easy to mistake stagnation for stability.

Some of the most common warning signs include:

• Revenue has remained flat for an extended period.
• Customer acquisition has slowed significantly.
• The company relies on small funding rounds just to survive.
• Product innovation has stalled.
• Talented employees begin leaving.
• There is no clear path to profitability or long-term growth.

Not every startup experiencing these challenges is a zombie. Markets fluctuate, fundraising becomes difficult, and even successful companies go through slow periods. The difference is persistence. If these issues continue year after year without meaningful progress, the startup may have entered survival mode.

Can a Zombie Startup Recover?

The answer is yes, but only if founders are willing to make difficult decisions.

Some startups regain momentum by pivoting to a different market or narrowing their focus to a customer segment where they have a stronger competitive advantage. Others recover by cutting unnecessary costs, simplifying their products, or building a more sustainable business instead of chasing rapid growth.

Of course, not every company can be saved. Sometimes the smartest decision is to close the business and apply the lessons learned to the next venture. Many successful entrepreneurs have built their greatest companies only after walking away from one that wasn't working.

Ultimately, entrepreneurship isn't about keeping a startup alive at all costs. It's about building a company that creates value and continues to grow. Recognizing the signs of a zombie startup early gives founders the best chance of changing course before survival becomes the company's only achievement.

Because in the startup world, staying alive isn't the same as moving forward.

Noha Gad

Investors and advisors often evaluate opportunities through multiple aspects: capital appreciation, total return, tax effects, and, crucially, cash flow. Cash-on-cash return (CoC) isolates the cash dimension of an investment by measuring the annual pre-tax cash income relative to the actual cash outlay required to acquire and prepare the asset. This focus on realized cash yield makes CoC an essential metric for income-oriented strategies, portfolio liquidity planning, and financing comparisons.

Unlike valuation-based metrics that ignore financing, CoC reflects the combined effect of operating performance and debt service, revealing how leverage and funding costs alter an investor’s immediate cash experience. It is simple enough for quick screening yet informative when paired with deeper analysis, helping to identify properties that deliver steady distributable income versus those that rely primarily on future price appreciation.

What is cash-on-cash return (CoC) and how does it impact real estate investments?

The cash-on-cash return is a straightforward metric that measures the annual return on cash invested in real estate, particularly commercial properties. Unlike standard return on investment (ROI), it focuses solely on the cash invested, offering clearer insight into an investment's performance, especially for properties with long-term debt. This calculation is pivotal in assessing potential cash distributions and understanding the effectiveness of a property investment strategy.

Calculations based on standard ROI take into account the total return on an investment. Meanwhile, Cash-on-cash return only measures the return on the actual cash invested, providing a more accurate analysis of the investment's performance.

CoC is calculated using an investment property's pre-tax cash inflows received by the investor and the pre-tax outflows paid by the investor. Essentially, it divides the net cash flow by the total cash invested.

By capturing the cash-generating performance of an investment in a single, easy-to-understand ratio, CoC has significant importance in:

• Reflecting financing effects. By using pre-tax cash flow after debt service, CoC reveals how leverage, interest rates, and loan terms change an investor’s cash position. Two properties with similar operating income can produce very different CoC outcomes depending on financing structure.
• Comparing multiple deals. CoC is quick to compute and useful for comparing multiple deals on a cash-yield basis during early-stage screening. It helps prioritize opportunities for deeper due diligence.
• Supporting liquidity and cash planning. For income-focused strategies and investors with near-term cash requirements, CoC helps forecast actual cash available for reinvestment or distribution.
• Early expectations. This metric provided an intuitive number for presenting expected annual cash returns to partners, lenders, or investors, aiding transparency in deal memos and investor presentations.

CoC is useful as a quick cash-flow snapshot, but it can easily mislead investors if they treat it as a complete measure of performance, as it has many pain points:

• Ignoring taxes. CoC return is calculated before tax, so it does not show the investor’s true net outcome. This can make an investment look stronger than it really is, especially in markets where taxes materially affect returns. 
• Missing long-term value growth. The metric focuses only on annual cash flow and does not account for property appreciation, principal paydown, or exit profits. Thus, it can undervalue investments that build wealth over time rather than producing immediate cash.
• Excluding time value of money. CoC treats all cash as equal, whether it is received now or later. This makes it less suitable for comparing investments with different holding periods or delayed payback profiles.
• High sensitivity to assumptions. Small changes in rent, vacancy, operating expenses, or financing terms can change the result significantly. If the inputs are overly optimistic, the return figure can give a false sense of confidence.

Finally, cash-on-cash return is a valuable metric because it shows how much actual cash an investment generates relative to the cash an investor puts in. It is especially useful for evaluating leveraged real estate deals, comparing opportunities quickly, and understanding how financing affects short-term performance. However, it must be treated as one part of a broader investment analysis, not the final answer, as it excludes taxes, long-term appreciation, time value of money, and many risk factors.

For this reason, the most effective approach is to use CoC alongside other measures such as cap rate, IRR, and stress-tested cash flow assumptions. This gives investors a clearer view of both immediate income potential and long-term investment quality.

Kholoud Hussein 

The Kingdom is no longer simply digitizing public services or investing in technology. It is attempting something far more ambitious: rebuilding its economic architecture around data, artificial intelligence, entrepreneurship, and digital infrastructure. The question is no longer whether Saudi Arabia can diversify beyond oil, but whether it can redefine what a modern digital economy looks like in the Middle East.

The Economy Saudi Arabia Is Really Building

For more than eight decades, Saudi Arabia's economic story has been inseparable from oil. Hydrocarbons transformed the Kingdom from a largely desert economy into one of the world's most influential energy producers, financing decades of infrastructure, industrialization, education, and social development. Oil was not merely a source of government revenue; it became the foundation upon which the modern Saudi state was built.

Today, however, Saudi Arabia is pursuing a transformation that is arguably even more profound than the discovery of oil itself. While much of the global conversation continues to focus on the Kingdom's diversification efforts under Vision 2030, a quieter yet far more consequential shift is unfolding beneath the surface. Saudi Arabia is no longer asking how to reduce its dependence on oil. Instead, it is asking what the country's next economic operating system should look like.

Economic diversification has traditionally meant expanding into new industries, whether tourism, manufacturing, logistics, mining, or entertainment. A digital economy, however, represents something fundamentally different. Rather than creating another sector alongside existing ones, it reshapes every sector simultaneously. It changes how governments deliver services, how companies produce goods, how entrepreneurs build businesses, how consumers spend money, and ultimately how economic value itself is created.

In this new model, data becomes a productive asset. Algorithms become economic infrastructure. Cloud computing replaces physical limitations. Artificial intelligence evolves from a technological tool into a driver of productivity, competitiveness, and innovation. The economy becomes less dependent on physical resources and increasingly powered by digital capabilities that transcend geography.

Saudi Arabia's ambitions therefore extend well beyond becoming a technology hub or attracting multinational technology companies. The Kingdom is attempting to redesign the foundations of its economy so that digital technologies become embedded across government, finance, healthcare, education, manufacturing, logistics, energy, and commerce. Success will not be measured by the number of technology companies operating in Riyadh or the volume of venture capital invested in startups alone. It will be determined by whether digital technologies become the default mechanism through which economic activity is created, exchanged, and scaled.

This is precisely why Saudi Arabia's digital transformation deserves to be viewed through an economic rather than a technological lens. Around the world, many countries have successfully digitized government services or expanded internet connectivity. Far fewer have attempted to rebuild their entire economic model around digital capabilities.

The Kingdom believes it can become one of them.

Yet ambition alone has never transformed economies. History offers countless examples of countries that invested billions in technology parks, innovation districts, and digital infrastructure without fundamentally changing how their economies functioned. Building a digital economy requires far more than laying fiber-optic cables or launching government applications. It requires rethinking regulation, attracting capital, cultivating entrepreneurial talent, building trust in digital services, encouraging private-sector innovation, and ensuring that digital technologies generate productivity rather than merely convenience.

Saudi Arabia's challenge, therefore, is not simply technological. It is structural.

The Kingdom must prove that digital transformation can become an engine of sustainable economic growth capable of generating new industries, creating high-value employment, increasing productivity, and positioning Saudi Arabia as a global exporter of digital innovation rather than a consumer of imported technologies.

It is an ambition that reaches beyond Vision 2030 itself. It is about defining what the Saudi economy looks like long after oil ceases to dominate global growth.

More Than Diversification: Redefining Economic Value

When policymakers first began speaking about economic diversification in Saudi Arabia, the objective appeared relatively straightforward: reduce dependence on oil revenues by expanding sectors such as tourism, mining, manufacturing, entertainment, logistics, and financial services. These industries would create new jobs, attract foreign investment, and generate alternative sources of national income.

A decade later, that conversation has evolved significantly. Today, diversification is increasingly viewed not as an end goal but as one component of a much larger economic transformation. The emergence of artificial intelligence, cloud computing, advanced analytics, and digital platforms has fundamentally altered how wealth is created in the global economy. Competitive advantage is no longer determined solely by natural resources or industrial capacity. It is increasingly shaped by a country's ability to generate, process, and commercialize data.

This shift helps explain why Saudi Arabia's investments in digital infrastructure have accelerated alongside investments in traditional economic sectors. The Kingdom is not merely building new industries; it is building the digital foundations upon which those industries will operate. The distinction is subtle but profound.

A tourism strategy can increase visitor numbers. A digital economy transforms the entire tourism value chain, from digital visas and intelligent transportation systems to AI-powered hospitality services, cashless payments, predictive demand forecasting, and personalized travel experiences. Manufacturing no longer depends exclusively on factories but on connected supply chains, industrial automation, predictive maintenance, and real-time analytics. Financial services become embedded into digital platforms rather than confined to bank branches.

In this sense, digital transformation ceases to be an ICT initiative and becomes national economic policy.

This is one of the defining characteristics of Saudi Arabia's approach. Rather than treating technology as a standalone industry, policymakers increasingly present digital capabilities as horizontal enablers capable of increasing productivity across virtually every sector identified in Vision 2030.

The result is a new understanding of economic value. Instead of asking how many barrels of oil the Kingdom exports, policymakers are beginning to ask how many digital transactions are processed daily, how much private capital flows into technology ventures, how many startups commercialize locally developed innovations, and how effectively data can be transformed into economic output.

Such questions would have seemed peripheral to Saudi Arabia's economic strategy only a decade ago. Today, they sit much closer to its center.

And perhaps that is the clearest indication that Saudi Arabia is pursuing something more ambitious than diversification. It is attempting to redefine the very mechanisms through which economic growth is generated.

Building the Digital Backbone: Why Infrastructure Became Saudi Arabia's New Strategic Resource

Every industrial revolution has depended on infrastructure. The railways powered the first age of industrialization. Electricity transformed manufacturing in the twentieth century. Highways connected national markets and accelerated trade. Today, the infrastructure that determines economic competitiveness is far less visible. It consists of fiber-optic cables buried beneath cities, hyperscale data centers, cloud computing platforms, artificial intelligence clusters, and billions of digital transactions flowing silently through secure networks every day.

Saudi Arabia recognized early that becoming a digital economy would require far more than launching government applications or encouraging online commerce. Digital services can only flourish when supported by an infrastructure capable of processing vast amounts of data securely, reliably, and at scale. In other words, before building digital businesses, the Kingdom first had to build a digital backbone.

That realization has fundamentally shaped Saudi Arabia's digital strategy over the past decade.

Unlike many countries where digital infrastructure evolved gradually through private-sector investments, Saudi Arabia adopted a coordinated national approach. Government entities, regulators, sovereign wealth funds, and global technology companies have worked simultaneously to establish the physical and regulatory foundations of the digital economy. The objective has never been limited to improving internet speeds or expanding telecommunications coverage. Instead, the Kingdom has sought to create an environment where digital businesses can emerge, scale, and compete internationally.

This explains why investments in telecommunications infrastructure have been accompanied by equally significant reforms in digital governance, cybersecurity, cloud regulation, spectrum allocation, and data management. Digital infrastructure, in the Saudi context, is viewed not as a utility but as a productive economic asset capable of attracting investment, reducing transaction costs, and increasing national competitiveness.

The impact of this strategy becomes particularly evident when examining how businesses now operate. A startup launching today in Riyadh enters a fundamentally different environment than one established only ten years ago. Cloud services can be deployed almost instantly. Payment systems are increasingly integrated. Government licensing has become significantly faster. Digital identity solutions simplify customer onboarding, while advanced logistics and communications networks enable companies to reach customers across the Kingdom with unprecedented efficiency.

For entrepreneurs, this infrastructure removes many of the barriers that once slowed business creation. For investors, it reduces operational risk. For multinational corporations, it provides the confidence to establish regional operations capable of serving broader Middle Eastern markets.

In many respects, infrastructure has become Saudi Arabia's most important competitive advantage.

This advantage extends well beyond connectivity. The Kingdom has increasingly positioned itself as a regional destination for cloud computing, recognizing that data storage and processing capacity will become as strategically important in the twenty-first century as ports, highways, and industrial zones were in previous decades.

The arrival of global technology companies reflects this shift. International cloud providers have announced significant investments in Saudi Arabia, encouraged by regulatory reforms, expanding demand, and the government's commitment to developing local digital capabilities. Rather than exporting data abroad, Saudi Arabia is gradually building the capacity to process, store, and analyze information domestically, strengthening both economic resilience and digital sovereignty.

The importance of cloud infrastructure cannot be overstated. Artificial intelligence applications require enormous computing power. Digital banking depends on secure cloud environments. Smart factories generate millions of data points daily. Autonomous transport systems rely on real-time information processing. None of these innovations can scale without robust digital infrastructure operating continuously behind the scenes.

As digital technologies become embedded across every industry, infrastructure itself begins to influence productivity. Faster networks reduce business costs. Secure cloud environments accelerate innovation. Reliable digital identity systems simplify financial transactions. Integrated government platforms reduce administrative burdens. Each improvement may appear incremental, yet together they reshape how economic activity occurs.

This transformation has also altered the relationship between the public and private sectors.

Historically, governments built roads, airports, and power stations while businesses invested in commercial opportunities. In the digital economy, these roles increasingly overlap. Governments establish digital platforms and regulatory frameworks, while private companies build products and services on top of them. The result is a more collaborative model in which public infrastructure creates opportunities for private innovation rather than replacing it.

Saudi Arabia's digital government initiatives illustrate this evolution particularly well. Instead of merely digitizing paperwork, government agencies have developed interoperable digital platforms that businesses can integrate directly into their operations. Entrepreneurs no longer spend weeks navigating administrative procedures that once required multiple physical visits to government offices. Licensing, taxation, customs, and regulatory compliance are increasingly handled through integrated digital systems, allowing companies to devote more resources to growth and innovation.

This seemingly administrative transformation carries profound economic implications. Time, after all, is one of the most valuable resources for any entrepreneur. Reducing bureaucratic friction does more than improve convenience; it lowers the cost of doing business. For startups operating with limited capital and tight timelines, these efficiencies can determine whether a company succeeds or fails.

Infrastructure has therefore become an invisible form of venture capital. Instead of financing individual companies, the government finances the environment in which thousands of companies can emerge.

Perhaps the most striking aspect of Saudi Arabia's digital infrastructure strategy is that it has been designed with future technologies in mind rather than current demand alone. Investments in artificial intelligence, edge computing, high-performance cloud services, cybersecurity, and advanced connectivity anticipate an economy that does not yet fully exist but is expected to emerge over the coming decades.

This long-term perspective distinguishes infrastructure planning from many earlier digital initiatives around the world, which often focused on solving immediate administrative problems. Saudi Arabia is instead attempting to create digital capacity before demand reaches its peak, positioning itself to capture future industries rather than reacting to them after they mature elsewhere.

Yet infrastructure alone cannot produce innovation.

Fiber-optic networks do not create startups. Data centers do not invent new business models. Artificial intelligence platforms do not automatically generate globally competitive companies. They provide the conditions under which innovation becomes possible, but they cannot substitute for entrepreneurship itself.

That is where the private sector enters the story.

As Saudi Arabia's digital foundations have matured, a new generation of startups has begun transforming public investment into commercial opportunity. They are not merely benefiting from the Kingdom's digital transformation; increasingly, they are becoming the mechanism through which that transformation reaches consumers, businesses, and global markets.

The digital backbone may have been built by national strategy, but its true economic value will ultimately be measured by the companies that grow upon it.

The Startup Layer: Where National Strategy Meets Entrepreneurial Innovation

Governments can build infrastructure. They can modernize regulations, invest in artificial intelligence, establish cloud regions, and digitize public services. Yet history has consistently shown that governments rarely create the innovations that transform everyday economic life. Those breakthroughs almost always emerge from entrepreneurs who recognize market inefficiencies long before policymakers do.

Saudi Arabia appears to understand this distinction. While much international attention has focused on the Kingdom's multi-billion-dollar investments in digital infrastructure and flagship projects such as NEOM, an equally significant transformation has been unfolding within its entrepreneurial ecosystem. Over the past decade, startups have evolved from peripheral players into one of the principal instruments through which the Kingdom's digital ambitions are being translated into commercial reality.

This shift represents a fundamental change in how economic development is being pursued.

For decades, economic growth in Saudi Arabia was largely driven by public expenditure. Government investments created industries, generated employment, and stimulated private activity. Today's digital economy, however, operates according to different rules. Innovation moves too quickly to be directed exclusively through public institutions. Consumer preferences evolve faster than regulation. Technologies become obsolete within years rather than decades. Under these conditions, entrepreneurship becomes not merely desirable but indispensable.

The Kingdom's role, therefore, has gradually evolved from being the primary driver of economic activity to becoming an enabler of entrepreneurial innovation.

This philosophy is increasingly visible across the Saudi startup landscape.

Rather than attempting to build digital services directly, public institutions have concentrated on creating the conditions in which private companies can solve market problems more efficiently. The result is an ecosystem where government provides the infrastructure, regulatory certainty, and access to capital, while entrepreneurs compete to create scalable solutions for consumers and businesses alike.

It is a relationship that has become one of the defining characteristics of Saudi Arabia's digital transformation.

Perhaps nowhere is this more evident than in electronic commerce.

Only a decade ago, launching an online retail business in Saudi Arabia presented significant logistical and operational challenges. Payment systems remained fragmented. Small businesses struggled to establish digital storefronts. Inventory management, shipping integration, customer analytics, and marketing tools were often inaccessible or prohibitively expensive for entrepreneurs.

Today, much of that complexity has disappeared.

Companies such as Salla and Zid have fundamentally changed how commerce operates across the Kingdom. Rather than simply providing website-building software, these platforms have developed integrated ecosystems that allow thousands of small and medium-sized enterprises to establish digital businesses with unprecedented speed. Payments, logistics, inventory management, marketing automation, customer engagement, and analytics are increasingly delivered through unified digital platforms, lowering the barriers to entrepreneurship for an entirely new generation of business owners.

In doing so, these companies have accomplished something larger than technological innovation. They have democratized access to entrepreneurship itself.

A similar transformation has occurred within financial technology.

Traditional banking systems often struggle to serve rapidly evolving digital businesses whose operational models differ significantly from conventional enterprises. Fintech startups have emerged precisely because they can respond more quickly to changing customer expectations.

Companies such as Tamara, which pioneered the rapid adoption of Buy Now, Pay Later (BNPL) services across the Gulf, have redefined consumer finance for younger generations accustomed to seamless digital experiences. Rather than viewing finance as a standalone banking product, these companies have embedded financial services directly into digital commerce, shortening purchasing journeys and expanding access to credit.

The significance of this innovation extends beyond consumer convenience.

Embedded finance fundamentally changes how money circulates within the economy. Transactions become faster, merchants experience improved cash flow, consumers gain greater purchasing flexibility, and digital commerce accelerates. What appears to be a simple payment option ultimately increases economic activity across multiple sectors simultaneously.

Equally transformative has been the emergence of Saudi startups specializing in artificial intelligence.

While much global discussion surrounding AI continues to revolve around large language models and consumer-facing applications, several Saudi companies have chosen a different path, focusing on enterprise solutions tailored to regional markets.

Companies such as Mozn have demonstrated how artificial intelligence can address highly specialized challenges in financial crime detection, compliance, fraud prevention, and risk management. Their success illustrates an important evolution within Saudi entrepreneurship. Rather than replicating Silicon Valley consumer applications, an increasing number of Saudi startups are developing technologies designed to solve complex business and institutional problems.

This transition from consumer applications to enterprise technology represents a critical milestone in any innovation ecosystem.

It indicates that entrepreneurship is beginning to create intellectual property rather than simply adapting existing business models.

A similar trend can be observed in companies like Lucidya, whose artificial intelligence platform enables organizations to analyze Arabic-language digital conversations across social media and online channels. By developing technologies specifically optimized for Arabic, Lucidya addresses a challenge largely overlooked by many global software providers.

Its competitive advantage lies not merely in technology, but in contextual understanding.

This highlights another defining characteristic of Saudi Arabia's startup ecosystem. Increasingly, local companies are identifying opportunities that international competitors cannot easily replicate because they require deep familiarity with regional languages, consumer behavior, regulatory frameworks, and business culture.

In many ways, localization itself has become a strategic advantage.

The construction and industrial sectors offer another compelling example.

Saudi Arabia's unprecedented investment in megaprojects has created demand for digital solutions capable of improving safety, productivity, and operational efficiency. Companies such as WakeCap have responded by integrating wearable technologies and real-time analytics into construction sites, enabling project managers to monitor workforce movements, improve safety standards, and optimize project execution through data-driven insights.

These innovations may appear highly specialized, yet their cumulative economic impact is substantial.

Construction productivity influences infrastructure delivery. Infrastructure affects logistics. Logistics shapes manufacturing competitiveness. The ripple effects extend throughout the broader economy.

The same pattern is emerging across healthcare, education, logistics, cybersecurity, climate technology, and industrial automation.

They identify inefficiencies invisible to large institutions and transform them into scalable business opportunities.

That capacity for experimentation may ultimately become one of Saudi Arabia's greatest competitive advantages.

Unlike traditional economic development strategies, which often depend upon large industrial investments with long implementation cycles, startups compress innovation into months rather than years. New products are tested rapidly, customer feedback is incorporated continuously, and successful models scale across markets with remarkable speed.

This entrepreneurial agility has become increasingly important as digital technologies evolve faster than regulatory frameworks can adapt.

Recognizing this reality, Saudi Arabia has invested heavily not only in startups themselves but in the ecosystem surrounding them.

Events such as LEAP have evolved into global platforms connecting founders with venture capitalists, multinational technology companies, policymakers, and institutional investors. Initiatives led by Monsha'at, the National Technology Development Program (NTDP), and innovation hubs such as The Garage have sought to reduce many of the structural obstacles traditionally associated with entrepreneurship, including access to funding, mentorship, technical expertise, and international networks.

The Public Investment Fund has further reinforced this momentum by channeling significant capital into technology-focused initiatives and attracting global venture investors to the Kingdom.

The cumulative effect is becoming increasingly visible. Saudi Arabia is no longer merely producing successful startups. It is beginning to produce an innovation economy. A startup ecosystem measures the number of companies created.

An innovation economy measures how effectively those companies reshape productivity, generate intellectual property, attract global capital, and create entirely new industries.

Saudi Arabia appears increasingly focused on the latter.

Yet becoming the Middle East's first truly digital economy will require more than a vibrant startup ecosystem. It will require demonstrating that digital technologies can transform not only new companies, but also traditional industries that continue to account for the overwhelming majority of national output.

The next phase of Saudi Arabia's transformation, therefore, may prove to be its most difficult: extending digital innovation beyond startups and embedding it into the wider economy, from manufacturing and logistics to healthcare, tourism, mining, and energy itself.

Mohamed Ramzy

Egypt's fintech sector is undergoing a period of rapid transformation, driven by the expansion of digital transformation, growing adoption of non-banking financial services, and continuous improvements to the regulatory landscape. These developments have enabled startups to introduce increasingly innovative solutions that address the evolving needs of both consumers and businesses.

Amid these changes, competition among fintech companies is no longer limited to offering payment or financing services. It has expanded to include the use of artificial intelligence and data analytics to build integrated financial platforms that deliver more seamless and personalized user experiences.

Klivvr is one of the companies embracing this shift. In a relatively short period, it has evolved from a digital financial services platform into a comprehensive financial ecosystem that combines payments, consumer finance, cards, and intelligent financial services, with technology serving as the primary driver of its growth.

In this interview, Sharikat Mubasher spoke to Omar Sherif, Co-founder and Chief Technology Officer of Klivvr, who discussed the company's growth trajectory, the role of artificial intelligence in shaping its products, the impact of support from Orascom Financial Holding, as well as his outlook on the future of fintech and Klivvr's expansion plans.

Klivvr has grown rapidly in a short period. How would you assess the company's performance today?

Since launching Klivvr, our objective has been to build a customer base driven by genuine engagement rather than simply increasing the number of registered users. We have focused on developing services that make the app an essential part of customers' everyday financial lives, and that strategy has clearly translated into strong usage metrics.

Today, the platform serves more than 700,000 users, including approximately 250,000 monthly active users, while around 25,000 customers use the app every day. We consider these figures far more meaningful than the total number of registered users because they reflect the extent to which customers rely on the platform for their daily financial transactions.

Going forward, we will continue expanding our user base while enhancing our services, all while maintaining the high-quality user experience that defines Klivvr.

Klivvr is backed by Orascom Financial Holding. How has this support accelerated the company's growth?

Being part of Orascom Financial Holding, together with the involvement of Onsi Sawiris as a co-founder, has added tremendous value to Klivvr since its inception. This goes beyond strengthening customer confidence; it has also provided us with invaluable strategic business expertise.

His continued participation in discussing the company's strategy, combined with his extensive network, has helped accelerate our growth and opened up new opportunities for Klivvr.

We see this relationship as much more than a financial investment. It is a genuine strategic partnership that actively contributes to building and developing the company.

Klivvr aims to build a fully integrated financial platform. How have the company's services evolved?

From the outset, our vision was never to offer a single service, whether in payments or financing. Instead, we set out to build a comprehensive financial ecosystem that addresses customers' diverse financial needs through one application.

The launch of our payment cards marked an important milestone in driving daily engagement with the platform. The cards now serve as a payment tool alongside our consumer finance services, enabling users to manage a significant portion of their financial activities within a single platform.

We are also preparing to launch a new feature that will allow customers to access their approved consumer finance credit limit directly through their cards, once we receive the necessary regulatory approvals.

Artificial intelligence has become a major focus across the fintech industry. How is Klivvr leveraging AI?

Artificial intelligence is now one of our top investment priorities because it has become a fundamental component of financial services improvement and customer experience enhancement.

We use AI technologies to deliver a more personalized experience for every user by analyzing financial behavior and recommending products and offers that best match individual needs.

AI also plays a key role in assessing creditworthiness and managing risk, helping us make better financing decisions while reducing default rates. In addition, these technologies support our internal teams by improving operational efficiency and accelerating product development.

From our perspective, artificial intelligence will become the cornerstone of the fintech industry over the coming years because of its ability to enhance efficiency while delivering faster, smarter, and more accurate financial services.

How do you view the growth opportunities in the Egyptian market?

The Egyptian market remains our largest growth opportunity. We believe the fintech sector is still in its early stages, and there are broad customer segments that have yet to benefit fully from digital financial services.

That is why we have invested heavily in building a robust technology infrastructure that enables us to scale quickly and efficiently within Egypt, while continuously developing products and services that meet customers' evolving needs.

What about Klivvr's plans to expand beyond Egypt?

Regional expansion is certainly part of our long-term strategy, but it is not our immediate priority. For now, our focus remains on achieving our objectives within the Egyptian market.

When we decide to enter new markets, expansion will not be pursued for its own sake. Instead, we will adopt the model that creates the greatest value, whether through organic growth, strategic partnerships, or acquisitions, depending on the characteristics of each market and the opportunities it presents.

How do you see Klivvr's future as the fintech industry continues to evolve rapidly?

Over the coming period, we will continue investing in technology and product innovation while expanding our customer base and strengthening our position in the Egyptian market.

We firmly believe that the future of financial services will be increasingly driven by data and artificial intelligence. That is why we continue investing in these technologies to deliver smarter, more efficient, and more user-friendly solutions that enhance the customer experience and support Klivvr's long-term growth.

Translation by: Ghada Ismail