Ghada Ismail

Not long ago, the relationship between large corporations and startups was relatively straightforward. Established companies invested in promising startups, partnered with them, or acquired them once they had proven their market value. Innovation largely happened outside the walls of major businesses.

Today, that dynamic is changing. Across Saudi Arabia, a growing number of conglomerates and family-owned business groups are taking a more active role in creating innovation by building startups themselves. Rather than waiting for entrepreneurs to identify opportunities, these companies are establishing dedicated teams tasked with spotting market gaps, developing new products, and launching entirely new ventures from within.

The shift reflects broader changes taking place across the Kingdom. As Vision 2030 drives economic diversification and digital transformation reshapes industries, Saudi companies are increasingly looking beyond their traditional business models. For many, the objective is no longer simply to adapt to change but to create the businesses that will drive future growth.

These internal startup units—often operating as venture studios, innovation hubs, or venture-building teams—are becoming an increasingly important part of how some of Saudi Arabia’s largest organizations approach innovation.

Why Conglomerates Are Looking Inward

For decades, diversification often meant expanding into new sectors through acquisitions, partnerships, or geographic growth. While these strategies remain important, they can be expensive, time-consuming, and dependent on opportunities that may not always exist.

At the same time, technological disruption is forcing companies to respond faster to changing markets. New business models can emerge rapidly, and startups have repeatedly demonstrated their ability to challenge established players with innovative products and services.

Many Saudi conglomerates have realized that waiting for the next disruptive company to appear may no longer be enough. Building ventures internally allows them to stay closer to emerging trends while creating businesses that align directly with long-term strategic priorities.

The Kingdom’s rapidly maturing startup ecosystem has also influenced this trend. Over the past decade, Saudi entrepreneurs have built successful companies across fintech, e-commerce, logistics, healthtech, and software. Their success has shown that innovative businesses can be created and scaled locally, encouraging larger corporations to adopt entrepreneurial thinking themselves.

What Is an Internal Startup Unit?

An internal startup unit goes beyond the role of a traditional innovation department.

While innovation teams often focus on improving existing products, services, or processes, startup units are typically tasked with creating entirely new businesses. Their role is to identify opportunities, validate market demand, develop products, and launch ventures that could eventually become standalone companies.

These teams often combine entrepreneurs, product managers, developers, strategists, and industry specialists. Many operate separately from core business units, giving them greater flexibility to experiment and move quickly without becoming trapped in corporate bureaucracy.

The goal is not innovation for its own sake, but the creation of sustainable businesses capable of generating new revenue streams and opening new markets for the parent organization.

The Venture-Building Influence

The rise of internal startup units is closely linked to the growing popularity of venture-building models globally.

Unlike venture capital firms that invest in startups founded by others, venture builders actively participate in creating companies from the ground up. They identify opportunities, assemble teams, develop products, and provide operational support throughout the startup journey.

The model has gained traction in Saudi Arabia through venture studios and startup factories that treat entrepreneurship as a structured, repeatable process rather than a matter of chance.

For conglomerates, the appeal is clear. Instead of investing in multiple external startups and hoping a few succeed, they can build businesses aligned with their own strategic priorities while leveraging assets they already possess.

Different Models Are Emerging

Saudi companies are experimenting with several approaches to venture building.

Some have established dedicated venture studios that operate almost independently, identifying opportunities and creating startups from scratch. Others have launched innovation labs focused on emerging technologies and experimentation, with successful projects sometimes evolving into standalone businesses.

A third approach involves commercializing internal capabilities. Technology solutions originally developed for internal use can become products serving external customers. Some companies are also pursuing joint ventures with entrepreneurs, international technology firms, or specialized operators to combine corporate resources with startup expertise.

Despite these differences, all of these models share the same objective: creating new growth engines beyond traditional business lines.

Saudi Companies Putting the Model into Practice

While Saudi Arabia's corporate venture-building ecosystem is still developing, several organizations have established structures that reflect different approaches to creating and scaling new ventures. Importantly, not all of these initiatives follow the same model. Some focus on building businesses internally, while others support external startups or expand through internal innovation.

One of the strongest examples of venture building in the Kingdom is Saudi Aramco. Through the Saudi Aramco Entrepreneurship Center, known as Wa'ed, the company has spent more than a decade supporting entrepreneurship and business creation. Complementing this effort are Wa'ed Ventures, Aramco's venture capital arm, and LAB7, its venture-building and product development platform. Together, these initiatives form part of a broader ecosystem designed to identify opportunities, develop technologies, support entrepreneurs, and help transform ideas into scalable businesses. While not a traditional startup studio in the Silicon Valley sense, Aramco has built one of the Kingdom's most structured pathways for venture creation and commercialization.

Beyond Aramco, other organizations are helping shape an emerging venture-building ecosystem. Dussur, established by Saudi Aramco, the Public Investment Fund (PIF), and SABIC, was created to develop strategic industrial businesses that advance Saudi Arabia's localization and industrialization ambitions. Unlike traditional investment vehicles, Dussur often works alongside partners to establish and grow new industrial ventures, making it one of the Kingdom's most prominent examples of institution-backed company building.

Another notable example is Sanabil Studio, a venture-building platform launched by Sanabil Investments. The studio works with entrepreneurs to identify market opportunities, validate ideas, assemble teams, and launch startups. Its model reflects the growing popularity of venture building in Saudi Arabia, where startup creation is increasingly being approached through structured processes rather than relying solely on individual founders.

Not all corporate innovation initiatives, however, focus on creating ventures internally. Some organizations have chosen to engage with the startup ecosystem through external support platforms. stc's InspireU program is a leading example. Since its launch, InspireU has provided startups with mentorship, funding, training, and access to industry networks, helping strengthen the Kingdom's entrepreneurial ecosystem while giving stc exposure to emerging technologies and business models.

Other companies demonstrate how internal innovation can create entirely new commercial opportunities without necessarily operating formal venture studios. Elm is one such example. Originally focused on digital government solutions, the company has steadily expanded its portfolio through the development of digital products and platforms serving both public- and private-sector customers. Its evolution illustrates how large organizations can leverage internal expertise, technology capabilities, and market knowledge to create new business lines and revenue streams.

The distinction is important. Building startups internally, supporting external entrepreneurs, and expanding through internal innovation are different approaches, but all reflect a broader shift in how Saudi organizations think about growth and innovation. While the Kingdom still has relatively few publicly documented corporate venture studios compared with more mature markets, an increasing number of organizations are experimenting with new ways to create businesses rather than simply invest in them. As competition intensifies and economic diversification accelerates, these models are likely to play an increasingly important role in shaping the next generation of Saudi companies.

Why the Model Makes Sense

One reason internal startup units are attracting attention is that they address several challenges commonly faced by traditional startups.

Access to funding is perhaps the most obvious advantage. Corporate-backed ventures typically begin with financial resources already in place, allowing teams to focus on product development and market validation rather than fundraising.

These ventures also benefit from established customer networks, supplier relationships, distribution channels, and industry connections that can accelerate growth significantly. Brand recognition provides another advantage. While independent startups often spend years building trust, ventures launched under respected corporate brands may gain credibility much faster.

Perhaps most importantly, they can draw upon decades of industry expertise. Large corporations possess deep knowledge of customer behavior, operational challenges, and market dynamics that can help new ventures avoid costly mistakes and identify opportunities more effectively.

Yet There Are Real Challenges

Despite these advantages, corporate venture building is far from a guaranteed success.

The biggest obstacle is often culture. Startups thrive on experimentation, rapid iteration, and calculated risk-taking, while large corporations are typically structured around governance, efficiency, and risk management. These priorities can sometimes clash.

A startup team may want to launch a product quickly, while corporate procedures require multiple layers of approval. Without the right balance, the speed and agility that make startups effective can easily be lost.

Talent acquisition presents another challenge. Experienced entrepreneurs and startup operators often prefer environments that offer autonomy and flexibility. Attracting and retaining such talent within a corporate structure requires thoughtful leadership, clear incentives, and sufficient independence.

Measuring success can also be difficult. New ventures rarely become profitable immediately, requiring organizations to evaluate progress based on learning, customer adoption, and market validation rather than short-term financial performance alone.

The Future Ahead

As Saudi Arabia continues its economic transformation, internal startup units are likely to play an increasingly prominent role within the private sector.

Sectors such as artificial intelligence, fintech, logistics, healthtech, climate technology, enterprise software, and industrial technology offer significant opportunities for corporate venture building. Future startup units may also collaborate more closely with universities, research institutions, entrepreneurs, and government-backed innovation programs, strengthening links between established corporations and the wider startup ecosystem.

What is clear is that the relationship between corporations and entrepreneurship is changing. Saudi conglomerates are no longer content with supporting innovation from the sidelines. Increasingly, they are becoming builders themselves, creating startups, launching new ventures, and shaping the next generation of businesses that could define the Kingdom’s economic future.

In many ways, this marks a new chapter for Saudi corporate innovation, one in which some of the country’s largest organizations are beginning to think and act more like startups themselves.

Noha Gad

Investors in today’s fast-paced financial world face a constant challenge: how to grow their wealth effectively without getting lost in the complexities of daily market movements. For both seasoned investors and those who start to build their portfolio, the decisions they make and the time they are willing to spend making them can significantly impact their financial future. For many, the ideal solution is to partner with a professional who can navigate market volatility on their behalf, combining expertise with a personalized approach to wealth management. This is where discretionary investment management comes in.

What is discretionary investment management?

Discretionary investment management is a service model in which a professional investment manager is authorized to make buying and selling decisions on behalf of the client, without needing prior approval for each transaction. Instead of spending hours researching stocks, analyzing trends, or monitoring global economic developments, clients delegate day-to-day portfolio decisions to a trusted advisor while retaining overall control through a clearly defined investment mandate. 

This service is usually offered to wealthy individuals or large institutions and often requires a large minimum investment. It can be an ideal choice for clients who do not wish to manage day-to -day investment decisions.

What do discretionary investment managers do?

Discretionary investment services cater to high-net-worth individuals and institutional investors, requiring minimum investments. The portfolio manager uses their expertise to grow and protect the client’s account balance over time, while making investments that align with the client’s goals.

Managers’ strategy may involve purchasing a variety of securities in the market, as long as it aligns with the client's risk profile and financial goals. Managers might buy stocks, bonds, ETFs, and financial derivatives.

Benefits of discretionary investment management

Discretionary investment management offers a compelling value proposition for investors who want professional expertise without the burden of daily portfolio oversight. Core benefits that make this approach increasingly popular among high-net-worth individuals, institutional clients, and retail investors include:

• Professional expertise and active management. Discretionary investment management offers access to skilled investment professionals who dedicate their time and knowledge to analyzing markets, identifying opportunities, and managing risk. These managers continuously monitor economic indicators, company performance, and global events to make informed decisions that align with the investment objectives.
• Time-saving and convenience. Saving time is one of the key benefits of discretionary management services. It also enables investors to focus on their career, business, or personal life, while the manager handles all transaction execution, research, and portfolio adjustments, making it a truly hands-off investment experience.
• Designing personalized portfolios. Discretionary managers create tailored investment strategies designed specifically for investors’ financial goals, risk tolerance, time horizon, and liquidity needs. Unlike off-the-shelf investment products or pooled funds that follow a one-size-fits-all approach, the portfolio is constructed to match investors’ unique circumstances. 
• Faster reaction to market opportunities. As discretionary managers can execute trades immediately without waiting for client approval, they can capitalize on time-sensitive opportunities or quickly reduce exposure during market downturns.

These benefits make discretionary investment management an attractive option for investors seeking expert guidance, efficiency, and the potential for superior risk-adjusted returns, all while maintaining control over their overall financial direction through a well-defined investment mandate.

Whether you are a high-net-worth individual, an institutional investor, or a retail investor increasingly accessing these services through digital platforms, discretionary management provides the perfect balance of professional expertise and hands-off convenience. It allows investors to focus on what matters most, their career, business, or personal life, while their portfolios are actively managed to align with their financial goals and risk tolerance.

Ghada Ismail

In the startup world, raising money is often treated as the ultimate sign of success. Big funding rounds generate headlines, attract attention, and create momentum around companies. But experienced founders know something many first-time entrepreneurs eventually learn the hard way: not all money behaves the same way.

Some investors stay committed when growth slows down or markets become uncertain. Others disappear the moment conditions become difficult.

That difference is what people in the investment world call “sticky capital.”

What Is Sticky Capital?

Sticky capital refers to long-term investment that stays committed to a company or market despite temporary setbacks, economic uncertainty, or market volatility.

Unlike speculative funding that chases trends and quick returns, sticky capital focuses on sustainable growth. Investors providing this type of funding understand that building successful businesses takes time and that difficult periods are part of the process.

In simple terms, sticky capital is often described as “loyal money.”

Sticky capital usually involves:

• Investors staying during downturns instead of exiting quickly 
• Long-term commitment over short-term gains 
• Patience with slower growth periods 
• Strategic guidance alongside financial support 
• Focus on fundamentals rather than hype 

For founders, this kind of stability can be incredibly valuable. It creates room to experiment, solve problems, and improve the business without constantly worrying about investors suddenly pulling back.

Not All Money Behaves the Same Way

In the startup ecosystem, founders often celebrate funding rounds as signs of success. But experienced entrepreneurs know that where the money comes from matters just as much as how much is raised.

Some investors aggressively enter trending sectors during boom periods, chasing hype and fast returns. But when markets cool down, they pull back just as quickly.

This is often called “tourist capital.”

Tourist capital follows momentum. Sticky capital follows conviction.

The difference is simple:

Tourist Capital

• Chases trends and hype 
• Focused on quick returns 
• Pulls back quickly during downturns 

Sticky Capital

• Thinks long term 
• Supports sustainable growth 
• Remains committed during uncertainty 

That difference can completely shape a startup’s future.

Why is Sticky Capital important?

Startups operate in uncertain environments by nature. Markets shift, customer behavior changes, competition evolves, and economic slowdowns can happen unexpectedly.

During those moments, stable investors become extremely important.

Startups backed by sticky capital are often better positioned to survive difficult cycles because they are not forced into panic-driven decisions. Instead of abandoning long-term goals outright, they can focus on improving products, refining operations, and adapting strategically.

Sticky capital also allows founders to think beyond short-term optics. When entrepreneurs know their investors believe in the bigger vision, they are more likely to invest in talent, infrastructure, and long-term product development instead of obsessing over the next funding round.

In many cases, companies built with patient capital become healthier businesses because they are focused on fundamentals rather than hype.

To Wrap Things Up…

Every startup ecosystem wants investment flowing into the market. But sustainable growth depends on attracting the right type of investment.

Sticky capital encourages healthier founder-investor relationships, supports long-term thinking, and helps startups survive difficult cycles without losing focus.

Most importantly, it creates businesses built on resilience rather than hype.

Noha Gad

When investors start investing, they often analyze the economy by studying interest rates, inflation, and political events. After forming a view on the broader market, they decide whether to buy stocks or to stay in cash. This way of investing is called top-down investing because it starts from the top, meaning the whole economy, and then moves down to individual companies.

Bottom-up investing inverts this hierarchy, treating the macroeconomic climate as a secondary, almost incidental variable. Instead of looking at the economy first, the bottom-up investor looks at a single company, reviews its annual report, and examines how much it makes and how much it spends. They examine its debts and its cash reserves, then ask simple questions: Does the company have a product that people truly need? Is the management team honest and capable? Does the company have a lasting advantage over its rivals, such as a well-known brand or lower production costs? After answering these questions, the bottom-up investor considers the broader economy, treating it as a secondary factor.

The bottom-up approach dismisses the notion that a great business is merely a beneficiary of favorable cycles. Instead, it posits that superior operational and financial fundamentals can generate alpha irrespective of the prevailing macro wind. It is the intellectual framework of concentrated portfolios, outsized long-term returns, and the kind of analytical patience that ignores headlines to focus on durable competitive advantage.

Understanding Bottom-Up Investing startegy

Bottom-up investing focuses on analyzing individual companies rather than broader economic trends. Investors who use this method look closely at fundamentals, such as revenue and earnings, to find strong companies. Unlike top-down investing, which focuses on the economy or sector trends, bottom-up investing prioritizes the company itself. 

Most of the time, bottom-up investing does not stop at the individual firm level, although that is where analysis begins and the most weight is given. The industry group, economic sector, market, and macroeconomic factors are eventually brought into the overall analysis. However, the investment research process begins at the bottom and works its way up in scale.

Bottom-up investors usually employ long-term, buy-and-hold strategies that rely strongly on fundamental analysis. This approach offers an in-depth look at a company and its stock, revealing its long-term growth potential. Top-down investors may be more opportunistic, entering and exiting positions quickly to profit from short-term market changes.

Key Features

1. Company-first focus: Decisions originate from micro-level insights about specific companies, not from macroeconomic themes.
2. Fundamental analysis: This approach focuses on revenue quality, margins, cash flows, balance-sheet strength, and sustainable profitability.
3. Management and governance: Close evaluation of leadership competence, capital allocation history, incentive alignment, and minority shareholder protections.
4. Active monitoring: Ongoing company-level monitoring for execution, guidance changes, insider activity, and competitive shifts.

These features make the bottom-up investing strategy a perfect choice for active equity managers and stock pickers seeking alpha from idiosyncratic company performance. It also suits value investors who focus on fundamentals and margins of safety, as well as Long-term investors and concentrated-portfolio managers who can tolerate company-specific volatility.

Significant risks

Bottom‑up investing is powerful, but it can easily become undisciplined if investors fall into classic behavioral or analytical traps. Major risks include: 

• Ignoring macro and sector risks: Bottom‑up investors sometimes focus tightly on company fundamentals that they downplay macro headwinds, such as currency depreciation, interest‑rate hikes, or sector‑wide regulation, that can hurt even strong businesses.
• Chasing past performance. Bottom‑up investors can slip into momentum‑style behavior by chasing recently overperforming names that already reflect high expectations, leaving little margin of safety.
• Over‑concentration or poor diversification. As bottom‑up investing emphasizes deep conviction in individual companies, investors sometimes hold too few positions, exposing themselves to single‑stock or single‑sector risk.
• Using incomplete data. Bottom‑up research that relies only on outdated financial reports or limited public disclosures can miss turning points such as margin compression, rising payables, or competitive losses.

Finally, bottom‑up investing offers a disciplined, company‑centered framework that cuts through macro noise and focuses on what ultimately drives returns: strong fundamentals, capable management, and sustainable competitive advantages. By starting with individual companies and only later layering in industry, market, and macro considerations, this strategy enables investors to uncover high‑quality businesses that may be overlooked or mispriced by the broader market.

For active managers, value‑oriented investors, and long‑term stock pickers, bottom‑up investing remains one of the most effective paths to meaningful, risk‑aware alpha, as long as its core principles are applied.

Ghada Ismail

A few years ago, launching a startup in Saudi Arabia usually followed a familiar path. Founders would enter an accelerator, pitch investors, secure early funding, and then try to figure everything else out along the way. Today, a different model is beginning to take shape across the Kingdom, one that is less about simply financing ideas and more about building companies from the ground up.

Welcome to the era of venture studios.

Across Saudi Arabia, a growing number of venture builders are quietly changing how startups are created. Instead of waiting for entrepreneurs to arrive with fully formed businesses, these studios help shape the idea itself, validate the market, recruit talent, build products, and guide operations from day one. In many cases, they act less like investors and more like co-founders.

The rise of players such as VMS, Sanabil Studio, and Lean Node Venture Studios reflects a broader shift happening inside Saudi Arabia’s startup ecosystem. The conversation is no longer just about funding entrepreneurs. It is increasingly about building startups systematically, repeatedly, and at scale.

Moving Beyond the Accelerator Boom

For years, Saudi Arabia has focused heavily on laying the groundwork for entrepreneurship. Government initiatives, accelerator programs, startup competitions, and venture capital funds helped create momentum in the ecosystem. As investment activity accelerated, the Kingdom quickly became one of the Middle East’s largest startup funding markets.

But money alone could not solve every challenge.

Many startups still struggle with execution. Some founders had strong technical skills but limited experience building scalable businesses. Others found it difficult to navigate regulations, recruit the right talent, localize products, or acquire customers efficiently.

That gap created space for venture studios to emerge.

Unlike traditional venture capital firms that invest after a startup already exists, venture studios often start much earlier. They identify opportunities internally, test market demand, help shape business models, and sometimes build entire companies alongside entrepreneurs from the earliest stages.

Globally, the model has already produced major companies within various sectors. Saudi Arabia is now adapting the concept to fit its own market dynamics and economic ambitions.

Why the Model Makes Sense in Saudi Arabia

The venture studio approach fits naturally with where Saudi Arabia’s ecosystem stands today.

Under Vision 2030, the Kingdom is trying to diversify its economy, accelerate innovation, create private-sector jobs, attract global talent, and localize emerging industries, all at the same time.

Venture studios actually offer a structure that supports many of those goals simultaneously.

Unlike short-term accelerator programs, studios stay involved throughout the startup journey. They provide operational support, legal guidance, hiring assistance, technical development, fundraising strategy, and business connections under one roof.

For first-time founders, that reduces risk considerably.

For investors, it creates a more controlled environment where ideas are validated before large amounts of capital are deployed.

And for Saudi Arabia, venture studios provide a way to systematically produce startups in strategic sectors such as fintech, AI, logistics, tourism, enterprise software, and digital commerce.

That is why many Saudi venture studios no longer describe themselves simply as investment firms. They position themselves as company builders.

VMS and Saudi Arabia’s Soft-Landing Opportunity

Among the more visible players in this space is Value Makers Studio (VMS), which positions itself as both a venture studio and a platform helping regional and international startups enter the Saudi market.

Based in Riyadh, VMS provides support that goes beyond capital, including technology development, legal assistance, marketing support, financial guidance, and access to Saudi business networks. The company also operates initiatives such as the ‘VMS Bridge Program,’ which focuses on connecting startups from emerging markets with Saudi Arabia’s innovation ecosystem.

That ‘soft-landing’ approach is becoming increasingly relevant as more foreign founders and international startups look toward Saudi Arabia as a regional expansion market.

VMS also reflects a broader trend emerging across the Kingdom’s startup ecosystem, where venture studios are evolving into ecosystem connectors alongside their company-building role. In practice, this often means helping startups navigate relationships with investors, corporations, regulators, and local business networks, presenting an advantage that can significantly influence how quickly companies scale in Saudi Arabia.

Sanabil Studio and Institutional Startup Creation

A stronger example of institutional venture building can be seen in Sanabil Studio, which was established by Sanabil Investments, a wholly owned subsidiary of the Public Investment Fund. 

The studio focuses on building startups from the earliest stages, working closely with founders across ideation, prototyping, MVP development, product design, engineering, hiring, finance, and growth support. According to the studio’s website, it combines capital, market insight, and hands-on operational support to help founders launch and scale ventures in Saudi Arabia. 

What makes Sanabil Studio particularly notable is its combination of sovereign-backed capital with hands-on company creation. Unlike traditional venture capital firms that typically invest after startups are already established, venture studios such as Sanabil Studio participate much earlier in the company-building process, often helping shape ventures from ideation through early execution. 

Lean Node and the “Startup Factory” Approach

Another important player is Lean Node, which focuses on building ventures internally while supporting entrepreneurs through structured startup-building programs.

According to the company, it has helped launch more than 18 startups since 2017 using a repeatable venture-building framework designed to reduce common startup risks.

Lean Node highlights one of the biggest advantages of the venture studio model: operational centralization.

Instead of every startup building separate HR systems, legal structures, financial operations, and development teams from scratch, studios create shared infrastructure that multiple ventures can use simultaneously.

This lowers costs, speeds up execution, and allows studios to test ideas more rapidly across different sectors.

In many ways, the model resembles a startup factory more than a conventional investment firm.

Lean Node and the “Startup Factory” Approach

Another important player in Saudi Arabia’s venture studio ecosystem is Lean Node, which focuses on building ventures internally while supporting entrepreneurs through structured startup-building programs.

According to the company’s website, Lean Node has helped build more than 18 startups since 2017 through a venture-building model focused on developing scalable businesses across the MENA region. The studio describes itself as “an engine that builds disruptive products” using a “tested and streamlined process” designed to maximize success while lowering risk. 

The company’s structure reflects one of the core characteristics of the venture studio model: centralized operational support. Rather than every startup independently building teams and systems from scratch, venture studios typically provide shared access to areas such as product development, operational guidance, technical expertise, and business support. This approach can reduce early-stage costs and accelerate execution across multiple ventures simultaneously. 

Lean Node has also expanded into specialized venture-building initiatives, including fintech-focused startup creation through partnerships such as Lean Fintech, launched with Mjalis Investment during LEAP 2023. 

In practice, the model operates more like a startup production platform than a conventional investment firm, with venture studios playing an active role in company creation rather than acting solely as financial backers. 

Closing the Founder Experience Gap

One reason venture studios are gaining traction in Saudi Arabia is that they directly address one of the ecosystem’s biggest challenges: experience.

The Kingdom has no shortage of ambitious entrepreneurs or available capital. What remains relatively limited, however, is the number of experienced startup operators who have repeatedly built and scaled companies.

Founders across the ecosystem frequently talk about the difficulties of navigating fundraising, finding product-market fit, hiring effectively, and scaling operations.

Venture studios attempt to shorten that learning curve.

Instead of forcing founders to figure everything out alone, studios embed experienced operators, engineers, marketers, product designers, and venture builders directly into the process from the beginning.

The Challenges Behind the Hype

Still, venture studios are not a perfect solution.

Some entrepreneurs argue that studio models can dilute founder ownership too aggressively. Others question whether startups created inside structured environments develop the same resilience as companies built independently.

There are also operational risks.

Running multiple startups simultaneously requires significant capital, talent, and management discipline. Internationally, several venture studios have struggled to maintain strong long-term performance across large portfolios.

Another open question is whether venture studios can consistently produce truly disruptive innovation rather than safer, optimized versions of existing business models.

Saudi Arabia’s ecosystem is still young enough that many of these questions remain unanswered.

Even so, supporters of the model believe the Kingdom’s current market conditions make venture studios especially relevant. In an ecosystem that is still building institutional startup knowledge, structured company creation may offer advantages that traditional founder-led approaches cannot always provide on their own.

The Future Ahead

The next phase of Saudi Arabia’s venture studio ecosystem will likely become far more specialized.

Future studios may focus entirely on sectors such as AI, cybersecurity, climate tech, gaming, logistics, biotech, fintech, or deep tech. Some early signs of that trend are already emerging through initiatives tied to advanced technologies and national innovation priorities.

AI-native venture studios could also become increasingly common as generative AI dramatically reduces development timelines and startup operating costs.

At the same time, international venture builders are expected to form more partnerships inside the Kingdom as Saudi Arabia continues positioning itself as one of the region’s largest startup markets.

What is already becoming clear, however, is that Saudi Arabia’s ecosystem is entering a new stage of maturity. The early era of startup hype is gradually giving way to something more structured, operational, and institutionalized. And venture studios may end up playing a central role in that transition, not simply by funding the next generation of Saudi startups, but by helping build them from scratch.