Saudi Startups Achieve $3.3bn In Venture Capital Funding Over 10 Years, Report Shows
Startups in Saudi Arabia have experienced significant growth the past decade, a total of $3.3 billion in venture capital funding, according to a report by MAGNiTT. The report, titled "10 Years Saudi Arabia Founders Report" and sponsored by Saudi Venture Capital Co., provides a detailed analysis of the backgrounds and expertise of startup founders in the country.
MAGNiTT CEO and founder, Philip Bahoshy, explained the purpose of the report, stating that it aims to dispel myths surrounding founders, empower aspiring entrepreneurs, guide policymakers in shaping innovation-friendly policies, and provide valuable intelligence to investors interested in the region.Nabeel Koshak, CEO of Saudi Venture Capital Co., emphasized the remarkable growth and dynamism of the Saudi startup landscape. He stated that the report's goal is to provide policymakers, government officials, and investors with valuable insights and data to inform strategic decisions and policies that will further nurture the startup ecosystem in the coming years.
The report compiled data from 200 Saudi-based startups that collectively raised $3.3 billion from 2014 to 2023. It revealed that 44 percent of these startups were launched by teams consisting of two founding members, who secured 53 percent of the total funding. On the other hand, startups founded by a single individual accounted for 30 percent of the funded startups but only received 15 percent of the funding over the past decade.The report also highlighted the experience of founders before launching their startups. It found that 36 percent of the 400 founders analyzed had at least 10 years of work experience. Additionally, 66 percent of the founders were first-time startup founders, indicating a trend towards entrepreneurship among less experienced individuals.
One significant finding of the report was the gender disparity in the Saudi Arabian startup ecosystem. Male founders comprised 94 percent of the total 400 individuals, while female founders accounted for only 6 percent. This gender gap is considerably wider than the global average, where female founders make up 15 percent of startup ecosystems.Regarding education qualifications, 55 percent of the founders in Saudi Arabia had at least a bachelor's degree. In terms of technical development, 59 percent of founders had technical education backgrounds, with a focus on science, technology, engineering, and mathematics. Additionally, 39 percent of founders held degrees in business, higher than the global average of 19 percent.
The report also examined the professional experience of founders. Despite fintech being the most funded sector, only 7 percent of founders had experience in finance, while 48 percent had backgrounds in information technology. Furthermore, only 12 percent of founders had experience in e-commerce, despite this industry accounting for the highest share of deals closed by the top 200 Saudi startups.
The majority of founders in Saudi Arabia had significant leadership roles before launching their startups. Thirty-one percent had served as a founder, co-founder, or board member, while only 4 percent originated from entry-level positions. Notably, Saudi Aramco was the most common previous employer among funded founders, with 7 percent having worked there before starting their startups.In conclusion, the "10 Years Saudi Arabia Founders Report" provides valuable insights into the Saudi Arabian startup ecosystem. It highlights the significant growth of startups in the country and sheds light on the backgrounds and experiences of founders. The report also emphasizes the need for policies and initiatives to support and nurture the entrepreneurial ecosystem in Saudi Arabia for the next decade.
Sign in with Google