SME

RECORD VC DEPLOYMENT SHOWS CONFIDENCE IN SAUDI START-UPS

Venture capital (VC) companies deployed USD 860 million in Saudi start-ups and small and medium businesses in the first six months of 2025 - up 116% compared to the same period last year. The funding at the half-way mark, surpassed that for all of 2024. 

The H1 2025 Saudi Arabia Venture Capital Report by Magnitt, which tracks investment flows in Middle East start-ups, showed Saudi Arabia maintained its top ranking in VC funding among MENA countries, accounting for 56% of the total capital deployed in the region.

The funding underscores the attractiveness of the Saudi market, with its competitive environment, and reputation as the largest economy in the MENA region. 

The kingdom also saw a record 114 VC deals in the first half of 2025, a 31% increase compared to the same period last year. The deals accounted for 37% of all agreements in the MENA region, marking the largest share ever for the kingdom. 

E-commerce ranked first among sectors in Saudi Arabia, representing 36% of the countryís capital deployed in H1 2025, with a value of USD 306 million, according to the Magnitt report. Fintech led in the number of deals, with 30 sealed, representing 26% of all VC deals in the country.

"Saudi Arabia is charting a bold course toward becoming a global start-up powerhouse. Underpinned by its ambitious Vision 2030 strategy, expansive government funding, and pro-investment reforms aimed at fostering innovation, VC investments will surpass USD 1 billion in 2025, reaching approximately USD 10 billion annually by 2030," according to the report. 

The local start-up ecosystem is thriving across high-growth verticals such as AI, fintech, and health-tech ñ driven not only by targeted national programmes and rising demand for digital-first solutions, but also by a new wave of Saudi entrepreneurs who now lead over 40% of VC-funded start-ups.

Meanwhile, the start-up exit environment is maturing as well, with successful IPOs like Jahez and Nice One boosting market confidence and paving the way for a surge in start-up exits, with 50+ IPOs expected by 2026, the report forecast.

TOURISM SMES

In July, Saudi Arabiaís Tourism Development Fund (TDF) unveiled three new programmes designed to accelerate the role of small and medium-sized enterprises (SMEs) in shaping the kingdomís tourism economy. These initiatives ñ the Grow Tourism Incubator, Tourism Hackathons & Bootcamps, and the Grow Tourism Accelerator ñ are delivered under TDF Grow, the fundís non-financial enablement arm. 

The programmes mark a significant step in TDFís broader mission to foster a supportive ecosystem for entrepreneurs and SMEs. By combining training, mentorship, and access to investors, the initiatives help businesses at different stages of maturity to overcome barriers to entry, scale effectively, and contribute to a competitive, innovation-driven tourism sector. 

"SMEs are the backbone of Saudi Arabiaís tourism economy," said TDF CEO Qusai bin Abdullah Al-Fakhri. "Our role is to equip them with the tools, knowledge, and networks to transform ideas into commercially viable projects. These programmes reflect our commitment to enabling growth that is sustainable, practical, and aligned with Vision 2030."

The Grow Tourism Incubator targets early-stage tourism start-ups, offering a 10-month programme that combines workspaces, legal and administrative support, and specialised training with one-on-one mentoring. For entrepreneurs outside the main hubs, hybrid delivery ensures accessibility across the kingdom.

Collectively, TDF Grow has supported more than 8,800 entrepreneurs and SMEs through its non-financial programmes to date. By lowering barriers, building capacity, and connecting businesses with opportunities, the fund is strengthening the role of SMEs in driving sustainable growth and diversifying Saudi Arabiaís tourism economy.

SUPPORTING E-COMMERCE GROWTH

Recently, the Transport General Authority (TGA) and Amazon signed a memorandum of understanding (MoU) aimed at transforming delivery infrastructure and supporting the growth of SMEs in the kingdomís thriving e-commerce sector. The agreement lays the foundation for a more innovation-driven regulatory environment. 

The strategic collaboration creates a comprehensive framework for TGA and Amazon to jointly modernise parcel delivery services across the country. The partnership will focus on embracing cutting-edge technologies and developing innovative financing and leasing solutions to support sustainable growth among local delivery companies and Amazonís last-mile partners. It also seeks to enhance service quality and expand delivery coverage to significantly improve the customer experience. 

The partnership will support the objectives of the National Transport and Logistics Strategy by promoting a more competitive last-mile delivery sector, increasing SME participation in the digital economy, and advancing Saudi Arabiaís position as a global logistics hub. This collaboration underscores the shared commitment of both organisations to drive economic diversification, enhance logistics efficiency, and foster a future-ready ecosystem aligned with national development priorities.