What is Venture Capital?
Venture capital is a form of private equity financing provided by funds to early-stage, high-potential companies in exchange for equity stakes. VCs accept high risk in pursuit of outsized returns.
How It Works
- VCs raise a fund from LPs and invest in a portfolio of startups.
- Founders give up equity in exchange for capital and strategic support.
- Exits come via acquisition or IPO over 5 to 10 years.
Saudi Context
Saudi VC has scaled rapidly under Vision 2030 — Sanabil, STV, Wa’ed, MISA-licensed funds, and CMA-regulated venture funds invested billions of SAR in fintech, logistics, and SaaS startups.
Example
A Riyadh-based fintech raises a SAR 60 million Series A led by STV, giving up 20% equity and joining the firm’s portfolio of MENA growth startups.