- Saudi Arabia’s startup scene saw a remarkable $3.3 billion in funding over the last decade, with 94% of founders being male.
- Only 6% of startup founders in Saudi Arabia are female, significantly lower than the global average of 15%.
- Male-founded startups secured 98% of total funding, while female-founded startups received only 0.4%.
- The report underscores a shift towards larger founding teams, with startups having three or more founders increasing over the years.
- Despite gender disparities, ongoing initiatives like Vision 2030 position Saudi Arabia to emerge as a regional startup and venture capital hub.
In the last decade, Saudi Arabia has witnessed a surge in startup activity, with 200 of the most-funded startups raising an impressive $3.3 billion in aggregate funding.
A recent market report by MAGNiTT and SVC sheds light on the founders behind these startups, providing valuable insights into the Kingdom’s venture capital (VC) landscape.
Founder Demographics
The report reveals a significant gender gap in startup founders, with male founders dominating the scene, accounting for 94 percent of the total share. In contrast, female founders represent only 6 percent, significantly lower than the global average of 15 percent.
This gender disparity is reflected in the funding distribution, with male-only founded startups claiming 98 percent of the total funding, while female-only founded startups secured a mere 0.4 percent.
Also Read:- 25 Unique Startup Accelerators and Incubators in Saudi Arabia
Founder Characteristics
The study highlights that 66 percent of the 400 founders were first-time startup founders, indicating a growing entrepreneurial spirit in the Kingdom.
Moreover, only 30 percent of the founders had prior regional startup experience, suggesting a relatively young and inexperienced entrepreneurial ecosystem.
Interestingly, 44 percent of the startups were launched with two founding members, who collectively accounted for 53 percent of the total funding raised.
Additionally, 36 percent of the founders had 10 years or more of work experience before venturing into entrepreneurship, bringing valuable expertise to their startups.
Startup Dynamics
The report delves into the dynamics of startup formation, revealing that nearly 50 percent of all funded startups in Saudi Arabia were founded by two members, while 30 percent were founded by solo founders.
Over the years, there has been a shift towards larger founding teams, with the proportion of startups with three or more founders increasing from an average of 21 percent in the initial five years to an average of 36 percent in the subsequent five years.
Insights and Initiatives
Philip Bahoshy, CEO of MAGNiTT, emphasized the importance of data and insights in supporting decision-makers and policy initiatives.
He stated that the 10-year KSA Saudi Founders Report is part of MAGNiTT’s ongoing efforts to foster transparency within the country’s venture and private capital landscape, in collaboration with SVC.
The MAGNiTT-SVC report provides valuable insights into Saudi Arabia’s burgeoning startup ecosystem, highlighting the significant contributions of founders in driving innovation and economic growth.
While the gender gap remains a concern, the increasing number of startups and the growing trend towards larger founding teams indicate a promising future for entrepreneurship in the Kingdom.
Future Outlook
With the government’s continued support for entrepreneurship and innovation through initiatives such as Vision 2030, Saudi Arabia is poised to become a regional hub for startups and venture capital investment.
By addressing the gender gap and fostering a more inclusive ecosystem, the Kingdom can unlock its full potential and drive even greater economic development through entrepreneurship.
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Last Updated on May 1, 2024 by Safiya K
