Hashgraph to launch Saudi DeepTech Venture Studio
Ministry of Investment, Hashgraph Group deal with $250 million over 5 years
#Saudi #DeepTech - The Switzerland-based startup ecosystem Hashgraph Association has signed a strategic partnership with the Ministry of Investment of Saudi Arabia (MISA) to launch a DeepTech Venture Studio in Riyadh, worth $250 million over the next five years. The studio will focus on the convergence of Web3, AI and technologies such as distributed ledger technology (DLT), virtual reality, robotics, and quantum computing, helping to launch 500 new companies over the 2024-2028 period.
SO WHAT? - Deep tech ecosystems are not yet well developed in the Middle East and whilst the demand for AI, robotics and other advanced technologies from Saudi Arabia and the UAE has grown, most startup ecosystems in the region focus on shallow-tech. However, Saudi Arabia has launched a number of deep tech initiatives over the past couple of years, reflecting the government’s strategic priority of encouraging the development of more intellectual property (IP) at home.
The Hashgraph Association (THA) and the Ministry of Investment of Saudi Arabia (MISA) signed the agreement during a Swiss Economic Mission to Saudi Arabia on Monday.
The DeepTech Venture Studio plans to help launch over 500 global and local companies during the five-year period, 2024-2028. Startups qualifying for the programme will receive up to $250,000 in venture capital investment, while enterprises can receive up to $500,000.
The first phase of the DeepTech Venture Studio will establish local operations and onboard 100 projects. One year after, the second phase will onboard and invest in a further 200 projects over 24 months. The final phase will scale up operations into new strategic markets globally, and onboarding the next and final batch of 200 projects
Following an initial investment commitment of $50 million, The Hashgraph Association will work closely with MISA to onboard other co-investors to participate in the studio.
Startups participating in the venture studio's programme will receive dedicated support from the Ministry of Investment to facilitate entrepreneurial licenses, compliance with Saudi laws and regulations, and connections with government stakeholders, strategic partners, and investors.
The formation of the new DeepTech Venture Studio aligns with the three pillars of Vision 2030 and its aim of fostering a thriving digital economy in Saudi Arabia.
The Hashgraph Association's service delivery organisation, the Hashgraph Group (THG)., will provide technical engineering, training and certification, project delivery, product development, business strategy, commercialization, marketing, legal and regulatory compliance, and venture capital investments - including IPO listing support on the Saudi Exchange (Tadāwul).
The Hashgraph Group already runs Hashgraph Innovation Program, a professional training and innovation program launched out of Canton Schwyz worth $165 million over five years (2022-2026).
ZOOM OUT - Deep tech is generally of interest to a smaller number of investors than other areas of technology and has not traditionally been a focus for Middle East venture capital. However, Saudi Arabia has recently announced a number of deep tech initiatives, aimed at encouraging the development of more intellectual property. King Abdullah University of Science and Technology (KAUST) last year launched its new research strategy Destination Deep Tech, aiming to bridge the gap between academic research and economic value, together with a $200 million Deep Tech Innovation Fund. Meanwhile in December, King Abdulaziz City for Science and Technology (KACST) launched Ignition, a startup incubator aimed at fostering new ventures in the semiconductor industry.
IMO - The stars seem to be aligning for Saudi Arabia's deep tech ambitions. Saudi's initiatives to create new industries, such as electric vehicles, industrial electronics, defence electronics and semiconductor, plus its smart city, Industry 4.0, and digital transformation programmes, provide plenty of problems for deep tech ventures to solve. However, forming and launching such ventures has proved difficult in the past. The Hashgraph Association's new Deep Tech Venture Studio, and its target of accelerating 100 deep tech ventures per year, could provide the additional momentum the Kingdom needs to ramp up creation of industrial IP.