20 Jun 2024
RIYADH: Saudi Arabia’s capital Riyadh is among the top five startup ecosystems in the Middle East and North Africa region, according to new data.
The international policy advisory and research organization Startup Genome, in collaboration with the Global Entrepreneurship Network, revealed that three of the Kingdom’s cities were among the top-ranked startup ecosystems in the region.
Riyadh was ranked fourth, with Jeddah and Alkhobar also making the list, according to Startup Genome’s latest Global Startup Ecosystem report.
The criteria for inclusion in the list required ecosystems to be ranked in the top 40 global leaders or top 200 emerging environments or to have a value greater than $200 million.
Furthermore, Riyadh was also one of two MENA ecosystems making the global list of cities with four or more unicorns in the last 10 years, the other being Dubai.
A company is termed a unicorn when it reaches a valuation of $1 billion without being listed on the stock market.
The report highlighted that the capital was ranked between 51 and 60 internationally, with its funding performance ranking seven out of 10.
The Kingdom was also praised for its proactive approach to embracing artificial intelligence, with the report highlighting the nation’s $40 billion commitment to boosting the technology.
The UAE’s capital, Abu Dhabi, was ranked as the fastest-growing startup ecosystem in the region, with a global rank between 61 and 70.
“In a nation emboldened by its strategic vision to become a dominant global technology hub, the UAE is establishing its capital city as one of the world’s most prominent destinations for high-growth technology companies,” the report stated.
Abu Dhabi’s ecosystem was valued at $4.2 billion, with one unicorn between 2021 and 2023. The city also saw a median funding of $825,000 in seed rounds. Total venture capital funding amounted to $1.1 billion between 2019 and 2023, with 16 exits during the same period.
The region has seen significant growth in venture capital and startup development in recent years, mostly driven by Saudi Arabia.
In 2023, the Kingdom secured 52 percent of the total VC funding in the MENA region, a substantial increase from the 31 percent share it held in 2022.
Saudi Arabia’s startup ecosystem ranked first in regional venture funding activities in 2023, amassing an unprecedented $1.38 billion in capital.
This achievement positioned the Kingdom at the forefront of venture capital funding in the Middle East and North Africa, surpassing the $1 billion mark for the first time, as reported by MAGNiTT in their Saudi Arabia FY2023 report.