RIYADH: The Saudi Industrial Development Fund Investment Co., or SIC, is expanding its presence in alternative financing instruments and venture capital investments, with CEO Fahad Al-Naeem expecting total investments to reach approximately SR1.6 billion ($425 million) by the end of this year.
In an interview with Asharq Bloomberg, Al-Naeem explained that the company plans to contribute to two or three additional funds before year’s end, including an infrastructure fund in partnership with a foreign investor, as well as funds specializing in growth financing and exploring direct investments in industrial and technology sectors.
SIC, a subsidiary of the SIDF, announced on May 13 its first venture capital investment, becoming a strategic investor in Khwarizmi Ventures 2. This move aims to support emerging technology companies linked to industry, logistics, and supply chains.
First venture capital investment
This investment represents SIC’s first direct foray into the venture capital sector, as part of a strategy to link traditional industrial financing with the innovation ecosystem and modern technologies, particularly those related to artificial intelligence, automation, and the Fourth Industrial Revolution, according to Al-Naeem, who confirmed that his company monitored the performance of Khwarizmi Ventures 1 before making the investment decision to ensure its viability.
He also noted that the Saudi market needs to diversify its financing instruments, highlighting that the current funding gap presents an attractive opportunity for investment institutions and asset managers. He added that SIC has exceeded SR1 billion in investment commitments to date, with more than SR300 million already disbursed. He explained that this new investment represents the company’s 11th investment and its first in a venture capital fund targeting the private sector.
For his part, Abdulaziz Al-Turki, managing partner at Khwarizmi Ventures, stated that the fund successfully closed its first funding round at $75 million and aims to exceed $100 million by the final close in the second half of the year.
Al-Turki clarified that the fund intends to invest in 20 to 30 startups over a 10-year period, injecting $1 million to $5 million in seed and early funding rounds.
Khwarizmi Ventures is a Saudi venture capital firm founded in 2018 that invests in early-stage startups across the Gulf Cooperation Council and the Middle East and North Africa region, managing a portfolio of 35 companies.