Saudi Arabia’s Rise As Global Startup Hub Attracts Egyptian Entrepreneurs

RIYADH: Saudi Arabia is rapidly emerging as a global hub for startups and entrepreneurs as the Kingdom continues to undertake massive diversification activities under Vision 2030, opening up new opportunities for innovative ideas and businesses to flourish.

The Global Entrepreneurship Congress, or GEC, which opens next week on March 27 in Riyadh, is one such platform where rising young talent and entrepreneurs from around the world will come together to tap into the burgeoning start-up market. of the Kingdom.

Saudi Arabia was chosen to host the event as it ranked first out of 45 countries, with Riyadh ranked as one of the top five regional cities based on startup ecosystem performance, according to startup ecosystem research firm Startup Genome.

The four-day event will feature 150 speakers including top policymakers, investors, company founders and CEOs, including Apple co-founder Steve Wozniak and Netflix co-founder Marc Randolph.

Technology is the engine of the world, and Saudi Arabia is already one of the biggest potential markets in MENA in terms of ICT.

Egyptian entrepreneur and founder of the technology startup DevisionX, Mahmoud Abdelaziz

startup ecosystem

Entrepreneurs from around the world are looking to Saudi Arabia as the country is witnessing a major shift in its economy, boosting the Kingdom’s startup ecosystem.

Saudi Arabia has seen a 54 percent increase in startup funding deals in 2021 compared to 2020 and accounted for 23 percent of all funding in MENA in 2021, according to a report by data platform MAGNiTT.

One of the countries that has successfully unlocked these financing deals with Saudi Arabia is Egypt, as both nations share immense market opportunities for the startup ecosystem.

“Technology is the engine of the world, and Saudi Arabia is already one of the biggest potential markets in MENA in terms of ICT,” Egyptian businessman and founder of tech startup DevisionX Mahmoud Abdelaziz said in an interview with Arab News.

HIGHLIGHT

• Saudi Arabia was chosen to host the event as it ranked first out of 45 countries, with Riyadh ranked as one of the top five regional cities for startup ecosystem performance, according to startup ecosystem research firm Startup Genome.

• The four-day event will feature 150 speakers including top policymakers, investors, company founders and CEOs, including Apple co-founder Steve Wozniak and Netflix co-founder Marc Randolph.

He will attend the GEC to connect with investors and create partnerships.

“There will also be a great contribution from Saudi Vision 2030 in leading the digital transformation in the region by supporting deep tech start-ups through investments and market opportunities,” Abdelaziz added.

As Egypt is taking important steps in its 2030 initiatives, the performance of the country’s business ecosystem has seen growth in recent years.

This puts local entrepreneurs in a better position to explore opportunities within Egypt and other regional countries, including Saudi Arabia.


Omar Hagrass, founder of Trella

Trella is extremely optimistic and committed to the future of Saudi Arabia. The Kingdom’s economy is diversifying and seeks to use the latest technologies.

Omar Hagrass, founder of Trella

Startup agreements between Saudi Arabia and Egypt

Egyptian entrepreneurs have turned to Saudi Arabia for funding and expansion plans, while many Saudi-based companies are doing the same in Egypt.

For example, Egypt-based logistics startup Bosta recently announced its expansion plans in Saudi Arabia after raising series B funds.

“As a focal area with a large economy and high e-commerce activity, the attractiveness of the Saudi freight and logistics market is attracting the attention of startups and investors,” Bosta co-founder Mohamed Ezzat said in a statement.

The sentiment is also shared by many other logistics companies like Trella, who are executing expansion plans in the Kingdom.

Cairo-based digital cargo marketplace Trella, which began operations in Egypt in 2018, expanded its operation to the Kingdom and later raised $42 million in its latest funding round that was co-led by Saudi-based venture capital Saudi Raed Ventures.

“Trella is extremely optimistic and committed to the future of Saudi Arabia,” founder Omar Hagrass told Arab News, adding that “the Kingdom’s economy is diversifying and looking to use the latest technologies.”

He said that major international companies are investing large amounts of capital in the UK market.

“All of this complements the Saudi Vision 2030 to drive business growth and attract investment; This all bodes well for entrepreneurship in the country,” added Hagrass. Raed Ventures founding partner Omar Al-Majdouie said in a statement that Trella’s growth is a combination of the founders’ expertise and a “booming cargo sector.”

While the Kingdom’s cargo sector is experiencing growth with new start-ups from Egypt entering the market, other sectors, such as e-commerce, are also seeing increased activity with acquisitions in both countries.

Saudi Arabian B2B e-commerce marketplace Sary recently announced the acquisition of Egypt-based e-commerce platform Mowarrid.

The acquisition is part of Sary’s plan to expand into the North African market, starting with Egypt, Africa’s second largest economy.

“Egypt is a strategic market for us and has great synergy with the Saudi and GCC markets,” Mohammed Al-Dossary, CEO and co-founder of Sary, said in a statement.

Saudi Arabia and Egypt share the stage of the entrepreneurial ecosystem, as both countries registered the highest number of investment deals in the MENA region, with 15 and 11 deals, respectively, in January 2022.

Saudi Arabian startups raised $219 million in February alone, accounting for more than half of the total $375 million of funds raised in the MENA region, according to a report by Wamda.

As it seems the sky is the limit for startups and entrepreneurs eyeing the Saudi market, deal sizes are expected to increase in the coming days, with regional countries like Egypt set to jump on the entrepreneurial bandwagon.

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