Saudi wealth fund unit backs Emkan Capital’s technology fund

A unit of Saudi Arabia’s sovereign wealth fund is among investors in Emkan Capital’s $31mn tech fund that will back early-stage startups across the Middle East.

Jada Fund of Funds, which is wholly owned by the Public Investment Fund, invested in the Emkan Capital Fund I, Emkan general partner Ghassan Aloshban said in an interview.

Emkan also received an investment from foreign investors including Ori Sasson, he said.

Emkan Capital will…

… invest in pre-seed and seed-stage companies with high-growth potential in sectors such as fintech, e-commerce, and logistics, Aloshban said. It will also cover frontier sectors like artificial intelligence, cyber, cloud and health tech across the Middle East, North Africa and Pakistan region.

Saudi Arabia’s PIF has been plowing money into tech firms and startups as it seeks to build a venture capital industry and encourage young entrepreneurs to set up their own businesses to diversify the economy and create jobs. It created a $1bn fund of funds for venture capital firms, and also invests directly through its subsidiary, Sanabil.

Read: Saudi Arabia’s PIF adds to games push with 5% Nintendo stake

In the Middle East, there are just a handful of unicorns — firms valued at above $1bn. Ride-hailing firm Careem is one of the region’s successes after Uber Technologies bought it for $3.1bn in 2019.

“Merger and acquisitions are the most common form of exists,” Aloshban said. Moreover, “the region has been very gung-ho about initial public offerings,” which he expects to pick up further.

Emkan’s current portfolio includes remittance firm Hubpay, biotech NovoGenomics, logistics firm Trukkin, and financial services company InvestSky.