Venture capital funds still eye Saudi market: Kearney

Mukund Bhatnagar, Kearney’s Financial Services Global Head

Venture capital funds remain interested in the Saudi market despite global uncertainty and a shift in liquidity flows toward US markets, Mukund Bhatnagar, Kearney’s global head of financial services, told Argaam on the sidelines of Money 20/20.

Venture investment has played a pivotal role in driving growth, with total funding exceeding $900 million in the first half of this year, compared with nearly $750 million in all of last year, he said.

Funds have become more selective in financing companies, which improves the quality of investments over the long term, Bhatnagar added.

He cited buy-now-pay-later firms Tamara and Tabby as examples of success stories that could draw more investors once geopolitical conditions stabilize. Strong ideas will continue to attract funding, while immature firms or those lacking proven models will struggle to secure capital, he said.

Saudi Arabia’s fintech sector has witnessed unprecedented growth over the past four to five years, with the number of companies rising to more than 250 local startups, from fewer than a tenth of that just a few years ago, Bhatnagar said.

The Kingdom now has a fertile ecosystem driven by a young population and strong reliance on the digital economy, positioning it to lead the sector regionally and globally in the coming period, he added.