��������

RIYADH: Riyadh is becoming a leading destination for tech startups in the Middle East, fueled by ��������’s Vision 2030 reforms, an advanced infrastructure, and robust government-backed incentives.

The Saudi information and communication technology market is projected to reach $54.90 billion in 2025 and $82.51 billion by 2030 at a compound annual growth rate of 8.49 percent, according to an analysis by Mordor Intelligence.

This growth highlights the Kingdom’s increasing prominence as a regional innovation hub.

At the heart of this transformation is ��������’s Vision 2030 economic diversification plan, which has placed technology at the forefront of its strategy. Major initiatives, such as NEOM, a $500-billion smart city powered by artificial intelligence and renewable energy, and Riyadh Tech Valley, a dedicated hub for AI, the Internet of Things, and robotics startups, are driving this momentum.

Government programs such as the Saudi Unicorns Program and Tech Growth Financing provide critical support for scaling businesses, further cementing Riyadh’s appeal. 

Emmanuel Durou, technology, media and telecommunications leader at Deloitte Middle East, highlighted three key operational factors behind Riyadh’s startup success. “First, ��������’s advanced digital infrastructure has significantly accelerated startup growth,” he told Arab News in an interview. 

The 2018 Bankruptcy Law emphasizes debt restructuring over liquidation, providing cash-strapped startups a mechanism to negotiate with creditors early before default.

Jasem Al-Anizy, partner in corporate finance at Addleshaw Goddard KSA

Government-led digital transformation initiatives have created a robust technological backbone, with 14 percent of Saudi broadband users enjoying speeds over 1G bits per second — far surpassing the 4 percent seen in markets like the UK. “This infrastructure supports rapid innovation and scaling up,” he added.

The second factor, according to Durou, is the Kingdom’s strategic focus on developing local talent pipelines. “As many as 86 percent of Saudi universities now provide undergraduate programs in AI, 56 percent offer master’s degrees, and doctoral opportunities stand at 9 percent,” he noted.

The Deloitte leader emphasized that institutions like King Abdullah University of Science and Technology play a pivotal role in supplying startups with skilled, technology-ready talent.

Lastly, Durou pointed to the Kingdom’s supportive business environment, which includes government incentives, substantial funding mechanisms like venture capital and private equity, and vibrant incubator ecosystems such as Garage 46 and Impact 43.

He also shed light on the Kingdom’s high consumer adoption rates of advanced technologies, particularly Gen AI. 

Deloitte’s recent survey outlined ��������’s high awareness of the technology at 76 percent, with usage frequencies of 20 percent daily and 32 percent weekly — significantly higher than the UK, he added. 

When comparing Riyadh’s startup scaling environment to Dubai’s, Durou observed distinct strengths in each. 

“In Riyadh, government-driven initiatives such as Saudi Vision 2030 have significantly streamlined regulatory processes, enabling startups to reduce their time-to-market,” he said, adding that “extensive support from local incubators, accelerators, and dedicated funding programs serve to further accelerate product development and launch timelines.”

Durou noted that customer acquisition costs in Riyadh are comparatively lower, driven by the ongoing surge in digital adoption among consumers and supported by targeted government-backed marketing initiatives. 

The fintech sector, in particular, benefits from robust governmental support, which helps meet rising local demand. Meanwhile, e-commerce growth is further propelled by high Internet penetration and shifts in consumer behavior.

“Dubai offers rapid market entry facilitated by the globally recognized Dubai International Financial Centre and a mature, efficient regulatory environment. Although high market competition can drive up customer acquisition costs in Dubai, it’s balanced by an expansive and diverse customer base,” he explained.

Durou highlighted that the DIFC ecosystem offers fintech startups access to government incentives, which greatly enhance their growth prospects. He also emphasized that Dubai’s strategic geographic position as a global trade hub, along with its advanced logistics and warehousing capabilities, significantly accelerates the expansion of e-commerce.

Jasem Al-Anizy, partner in corporate finance at Addleshaw Goddard KSA, shed light on the legal structures that are proving effective in the Kingdom.

“Saudi startups have historically preferred an offshore ring-fencing of intellectual property assets by holding and protecting intellectual property interests in a standalone sister company based in an offshore jurisdiction,” he explained to Arab News.

“This has helped startups in scaling globally and simplifies exit strategies,” Al-Anizy said. 

Government-driven initiatives have significantly streamlined regulatory processes, enabling startups to reduce their time-to-market.

Emmanuel Durou, technology, media and telecommunications leader at Deloitte Middle East

However, with stronger business and intellectual property laws, there is increasing trust in local company structures like the Simplified Closed Joint Stock Co.

Al-Anizy also highlighted the advantages of Riyadh’s bankruptcy laws for tech startups facing liquidity challenges. The 2018 Bankruptcy Law emphasizes debt restructuring over liquidation, providing cash-strapped startups a mechanism to negotiate with creditors early before default, he said.

The law was introduced to provide guidance on the adoption and implementation of bankruptcy proceedings. Despite its name, the primary objective of the Bankruptcy Law is not liquidation but rather the rescue of insolvent businesses through reorganization and financial restructuring.

Al-Anizy said that this sophisticated regime demonstrated in recent large-scale restructurings, has garnered recognition from founders and investors alike. On the dispute side, mediation and the Saudi Center for Commercial Arbitration are becoming preferred avenues for resolution.

For foreign founders setting up their MENA Headquarters in Riyadh, Al-Anizy stressed the importance of clear contractual considerations. “Founders having an unclear picture of their share cap table, equity vesting, or the conversion of any issued SAFE/KISS notes is an easily avoidable way to lose investor confidence,” he warned.

A Simple Agreement for Future Equity is an investment instrument that allows startups to raise capital without immediately determining a valuation, converting it into equity upon a future-priced round or liquidity event. Similarly, a Keep It Simple Security operates as either a convertible note or a SAFE-like agreement, offering standardized terms for early-stage funding.

Both are designed to streamline early investments while deferring valuation discussions, but founders must track their terms, such as discount rates, valuation caps, and conversion triggers, to maintain transparency with investors.

Al-Anizy also advised explicit contractual clauses to ensure intellectual property rights are clearly vested in the company, safeguarding the business and maintaining investor trust.

Riyadh has become a magnet for multinational corporations, with around 600 foreign companies establishing their regional headquarters in the city since the launch of the Saudi Program for Attracting Regional Headquarters in 2021.

Spearheaded by the Ministry of Investment and the Royal Commission for Riyadh City, this initiative is a cornerstone of Vision 2030’s goal to position �������� as a global business hub.

The program offers compelling incentives, including a 30-year tax relief package with 0 percent corporate and withholding taxes, streamlined setup processes, and access to world-class infrastructure.

Riyadh’s strategic location at the crossroads of Asia, Africa, and Europe, combined with its skilled workforce and economic stability, has made it the top choice for multinationals looking to expand in the region.

Riyadh’s appeal is further bolstered by business-friendly policies, including 100 percent foreign ownership in key sectors, tax incentives, and streamlined licensing through the Saudi Business Center. Startups also benefit from partnerships with major corporations like Aramco and STC, as well as accelerator programs from Flat6Labs and 500 Global. 

With a population of 36 million and the largest economy in the Middle East and North Africa, �������� offers startups access to a high-spending consumer base and a gateway to regional expansion. The Kingdom’s advancements in technology were recognized in the 2024 Global Innovation Index, where it secured the 47th spot among 132 countries.

Events such as the LEAP Tech Conference and Riyadh Season continue to draw global investors, while local success stories — from Tamara, ��������’s first fintech unicorn delivering payments and banking, to Salla, an e-commerce platform empowering SMEs with digital storefronts — demonstrate Riyadh’s potential as a launchpad for high-growth companies.

Saudi Entertainment Ventures, known as SEVEN, is investing heavily in the future of the Kingdom’s entertainment sector by creating a broad spectrum of job opportunities, said Abdulelah AlFawzan, chief projects officer at SEVEN.

AlFawzan told Arab News that SEVEN is developing a diverse range of technical, creative, operational, and managerial roles to unlock “new horizons of joy” while building a thriving and sustainable workforce that mirrors the energy and ambition of ��������.

He said the company has already achieved 55 percent Saudization across its workforce, including 45 percent in leadership positions. “Through initiatives such as our Future Leadership Program in partnership with IMD, we are equipping Saudi talent with global best practices in entertainment management, ensuring they are prepared to lead this sector forward,” AlFawzan explained.

He said that delivering the best guest experiences depends on passionate, diverse teams who deeply understand and share the culture of the communities they serve. “We are committed to creating opportunities that empower Saudi youth to build meaningful careers in the entertainment industry,” he added.

The chief projects officer revealed that SEVEN is reshaping international entertainment experiences to resonate strongly with Saudi cultural values. 

AlFawzan stressed that guests remain at the core of every decision SEVEN makes. When collaborating with global brands like Warner Bros. Discovery, Mattel, and Hasbro, the company ensures a robust commitment to meaningful localization.

“It is never a matter of simply importing a concept,” he said. “We carefully reinterpret every experience to reflect Saudi traditions, family values, and community preferences.”

AlFawzan disclosed that more than 60 percent of SEVEN’s offerings are locally inspired, which guarantees that each destination feels authentic, familiar, and welcoming to Saudi audiences. “Our aim is for every visitor to feel a deep sense of cultural pride and connection upon entering a SEVEN venue because, for us, entertainment reflects identity — not just leisure,” he said.

Addressing concerns about whether large-scale projects like SEVEN overshadow local businesses in favor of international brands, AlFawzan reaffirmed the company’s dedication to nurturing both.

“We firmly believe that global and local players, alongside diverse creative talent, are all essential to the success of our destinations,” he said. While SEVEN partners with renowned names such as Warner Bros. Discovery, Mattel, Flow House, Play-Doh, Clip ‘n Climb, and Hasbro, it equally prioritizes celebrating Saudi creativity.

He said that the company is actively developing original attractions and homegrown concepts across its venues by working closely with Saudi artists and entrepreneurs to bring local content and ideas to life.

“Whether through Saudi-owned offerings or regionally inspired entertainment, we are establishing platforms where local innovation can thrive alongside international intellectual properties,” AlFawzan said. “Our guests deserve an entertainment landscape that honors global excellence while remaining deeply rooted in Saudi identity, originality, and values.”

AlFawzan also said that SEVEN places sustainability and cultural connection at the core of its nationwide entertainment developments, fully aligned with Saudi Vision 2030.

“Sustainability is not an afterthought at SEVEN; it is a guiding principle embedded in every stage of our development,” he said. He detailed how the company integrates environmental responsibility from design through construction and into long-term operations, with a clear focus on minimizing environmental impact.

He said that SEVEN is targeting LEED certification across its portfolio spanning 14 cities. “To date, we have recycled more than 75 percent of construction waste and sourced over 50 percent of materials from certified green suppliers,” AlFawzan noted. He highlighted that the incorporation of high-performance solutions has led to energy savings of up to 20 percent and water savings of up to 80 percent in key project locations.

Beyond environmental stewardship, SEVEN prioritizes broader social impact through community engagement and cultural preservation. “Entertainment is a powerful catalyst for community connection and cultural pride,” AlFawzan explained.

“With over SR50 billion ($13.3 billion) invested across 14 cities, our projects are accessible within minutes or a short drive for most Saudi communities,” he pointed out. “Accessibility is at the heart of our vision: making extraordinary experiences part of everyday life.”

He also revealed that SEVEN is introducing region-first and world-first concepts to the Kingdom, including the world’s first Hot Wheels electric go-karting experience and next-generation Family Entertainment Centers that seamlessly combine physical play with digital interaction.

“But more than the rides and attractions, what truly sets SEVEN apart is our focus on culture and community,” he added.