Saudi Aramco Allocates $100 Million for AI Investments, Accelerating Saudi Arabia's Global AI Ambitions

Saudi Aramco's venture capital arm, Wa'ed Ventures, has earmarked $100 million to invest in early-stage artificial intelligence (AI) startups. This move marks a significant step in Saudi Arabia's push to become a more competitive force in global AI. It is part of a broader effort to diversify the country's economy and shift focus from oil to rapidly growing non-oil sectors, aligning with the kingdom's Vision 2030 initiative.

Wa'ed Ventures, a $500 million VC arm of Aramco, is doubling down on AI investments this year as Saudi Arabia seeks to establish itself as a global AI hub. The fund aims to generate a strong pipeline of global AI startups by promoting innovation and localization of international talent. Anas Algahtani, the acting CEO of Wa'ed, emphasized that this investment will not only incentivize local entrepreneurs but also foster the development of cutting-edge technologies that will drive economic growth, improve quality of life, and position Saudi Arabia as a leader in the AI sector.

Aramco’s Venture Arm Allocates $100 Million for AI Investments – BNN Bloomberg

To ensure strategic deal sourcing and accelerate the localization of global startups, Wa'ed Ventures has appointed an advisory board. The board includes former employees from prominent companies and institutions like Meta Platforms Inc., Amazon.com Inc., Massachusetts Institute of Technology (MIT), and Oxford University. This diverse expertise supports Wa'ed's mission to invest in startups that can transform Saudi Arabia's AI landscape.

Over the next three years, Wa'ed Ventures will deploy the $100 million fund to fuel these AI investments. This comes on the heels of recent investments by Wa'ed, including $15 million in the South Korean chipmaker Rebellions Inc. and backing the AI platform Explain, as well as the Peter Thiel-backed AI firm Tenderd. The venture arm has been actively participating in the AI sector, investing in companies that offer potential for infrastructure development and innovative applications in AI technology.

Saudi Arabia's broader AI strategy is rooted in its Vision 2030 agenda, which seeks to drive economic diversification using data and AI throughout the current decade. By 2030, Saudi Arabia aims to lead the region and compete globally in AI. The kingdom has been closely competing with the UAE, with both countries racing to establish state-of-the-art data centers and positioning themselves as regional tech superpowers.

According to reports, Saudi Arabia's government plans to create a $40 billion AI fund to support the nation's AI ambitions further. In line with this, representatives from Saudi Arabia's Public Investment Fund (PIF) have discussed potential partnerships with leading venture capital firms, including Andreessen Horowitz, to explore additional opportunities in AI.

The economic potential of AI for Saudi Arabia is vast. A report from PwC estimates that AI could contribute as much as $135 billion to Saudi Arabia's economy by 2030, accounting for 12.4% of the country's gross domestic product. Saudi Arabia has already emerged as the most funded country for startups in the Middle East, raising $1.3 billion in venture capital in 2022, surpassing the UAE as the region's top destination for VC investment.

Established in 2013, Wa'ed Ventures has been instrumental in promoting economic diversification in Saudi Arabia by investing in high-growth technology startups across multiple sectors. Managing a portfolio of over 70 startups, Wa'ed has played a pivotal role in nurturing the tech ecosystem in the kingdom. Recent AI-related investments include the Korean AI chip company Rebellions, the California-based startup AiXplain, and the Egyptian deep-tech startup Intella, which focuses on AI. Wa'ed Ventures also invested in Tenderd, a company specializing in AI technologies, further signaling its commitment to backing high-potential AI applications and infrastructure.

With Saudi Arabia aiming to become a global leader in AI, Wa'ed Ventures' continued investment in AI startups represents a strategic effort to bolster the kingdom's economic diversification and technological advancement. Through these investments, Saudi Arabia seeks to unlock the immense potential of AI, both locally and globally.