We announced during the LEAP 23 Conference in Riyadh the launch of the STV Total Growth platform, anchored by our partners at the National Technology Development Program (NTDP). With $150m+ in initial commitments and growing, the platform aims to accelerate the growth of technology companies in the region through both equity and debt.
Looking back at our market a few years ago, it was clear to see a massive gap emerging. There was an immense demand for technology companies, locally, yet a low supply when compared to the rest of the world. Especially when looking at the production of large tech companies. A massive transformation was already happening in the Kingdom. A grand vision was being put in place, and execution power was set in motion, all thanks to great leadership that saw the future and did not settle to building it, but even go as far as leapfrogging it.
In 2017, we saw this opportunity and wanted to play our part in supporting founders building the next gen economic engines of the region and we started STV. Our partners at stc believed in this vision and made a huge bet on us, and we entered the market with $500M for our first fund. An amount that was 12x the total capital deployed in the Kingdom that year. Today, our 30 portfolio companies have raised more than $1.5bn, attracted $600m in foreign direct investments, generated $28bn in merchandise value, and created more than 10k jobs.
We projected in our recent From Startup To IPO: Unlocking A $100b+ Opportunity In MENA report that the region is poised to output 45 unicorns by 2030, presenting a $100b value opportunity and predicting the emergence of the next tech alpha, from MENA to the world. However, for the region to realize this potential, we estimated that $25b in growth-stage funding is needed in the next 5 years. And with Saudi becoming the gravitational center of the region, attracting the most promising tech ventures, we believe that we have a unique opportunity to bridge this gap.
Having invested in a portfolio of fast-growing companies, and being among MENA’s most active growth-stage investors, we recognized the need for both equity and non-dilutive debt funding for tech companies, particularly in the growth stage. With this new platform, we aim to stimulate regional tech ventures, by offering founders access to a suite of funding solutions that serve their needs throughout their growth journeys.
STV Total Growth will use a comprehensive suite of funding instruments to fuel growth stage technology companies in the region. Aside from equity in the form of venture capital, a newly developed product named Tanami will act as a Sharia-compliant non-dilutive venture debt instrument. The new Tanami instrument is expected to play a key role in the development of the tech ecosystem in the region and finance many of the rapidly growing companies within the next three years.