Saudi Technology Ventures, a 500 million USD technology venture capital firm has reported that the Middle East and North Africa (MENA) region has the potential to create 45 tech start-ups worth almost $100 billion by 2030.
Saudi Technology Ventures (STV) said the MENA region could produce 45 companies worth a minimum of $1 billon each before the end of the decade as well as a decacorn, which is a technology company worth $10 billion.
As per SV’s report entitles “From start-up to IPO” the decacorn is expected to reach a value of $20 billion, while five start-ups will be worth $5 billion, 13 worth $2 billion and 26 worth $26 billion. This would bring the total worth of unicorn and decacorn start-ups to $97 billion.
In addition given that region also has the highest percentage of “unbanked” consumers, or those without bank accounts, at 45%, this means there is a large potential for FinTech businesses,.
STV described Saudi Arabia as the “gravitational centre” for the broader MENA catchment area, which also includes Central Africa, Southeast Europe and Southwest Asia. Venture capital funding in Saudi Arabia surged more than threefold to $584 million in the first half of 2022, surpassing the total for the whole of 2021. The world’s top oil exporter is projected to spend about $33bn on ICT development in 2022, the International Data Corporation says
The report adds that MENA witnessed this tipping point in 2021, with a steep increase of VC deployed capital and of growth-stage deals (defined as funding rounds larger than $5M). The acceleration of the economic and technological ecosystem is driven by a growing talent pool, tech infrastructure, consumer adoption, as well as broad macroeconomic and regulatory reforms.
The two main drivers of Saudi’s status as a hub for tech start-ups are its GDP, which account for one third of the region’s GDP and the size and depth of its stock exchange, STV said. New development programmes and company laws designed to encourage innovation and remove barriers also play a part.
