Saudi Arabia’s Sovereign Wealth Fund Invests in Crypto-friendly VC Firms

In a bold move towards innovative investments, Saudi Arabia has recently revealed its stakes in close to 40 American venture capital firms, demonstrating an increased interest in emerging technologies such as crypto, blockchain and Web3.

This disclosure includes investments from Sanabil, the venture capital branch of the Public Investment Fund, which annually allocates approximately $2 billion towards multiple funding rounds aimed at nurturing start-ups with unconventional business models.

With a focus on diversifying its portfolio, Sanabil’s latest investment ventures into prominent names in the venture capital arena.

Fostering a Diverse Economic Ecosystem

The announcement reinforces the notion that the Kingdom of Saudi Arabia aims to foster a more diverse and dynamic economic ecosystem that embraces the technological changes that are shaping the future.

Although the exact details of investments made by each firm remain unclear, it is believed that Sanabil, the venture capital arm of the Public Investment Fund of Saudi Arabia, has invested in some of these firms.

However, VCs have remained tight lipped about their association with the Kingdom of Saudi Arabia since the 2018 killing of journalist Jamal Khashoggi.

Sanabil is known to assign 50% of its asset allocation to venture capital, 30% to private equity, and 20% to a liquid portfolio.

While it has publicly disclosed its investments in crypto-friendly venture capital firms, the nature of its liquid portfolio with respect to digital assets remains unknown.

With an increasing interest in emerging technologies, Saudi Arabia appears poised to explore new investment opportunities, while also attempting to navigate the complexities of geopolitical relations.

Final Thoughts

Saudi Arabia’s future-oriented outlook is also evident in its plans to build a twin version of its futuristic desert city, Neom, in a metaverse offering.

While it is not yet clear whether blockchain or crypto will be utilized, the government signed a memorandum of understanding with blockchain startup known as The Sandbox.

This partnership will see the startup provide advice and possibly work on metaverse projects, suggesting that Saudi Arabia is looking to embrace emerging technologies in its quest to build a more diverse and resilient economy.