Endeavor publishes a report about the state of Saudi’s startup ecosystem

Endeavor Saudi Arabia, in partnership with EndeavorInsight, launched their latest research project. It studies, analyzes, and maps the activity, connections, and activities in Riyadh’s entrepreneurial tech ecosystem over the past 20-years. The report, Mapping the Riyadh Technology Sector: A Network Analysis by the Entrepreneurship Community, was published at an Endeavor event in Riyadh. It was attended by H.E. Eng. Haitham AlOhali Vice Minister of Communications and Information Technology Successes in the tech sector are examples of Saudi Arabia’s growing diversity, inclusion, and innovation. The research showed that Riyadh’s tech sector has grown rapidly with 50% of companies in Riyadh’s tech ecosystem founded in only the past 5 years, but only 18% of those young companies have become scaled companies. These scaled businesses provide 90% of the jobs in Riyadh’s tech sector. In recent years, the ecosystem has seen a rapid growth thanks to VCs and government initiatives as well as globally connected support organizations. This report examines the scaled companies within the ecosystem. It identifies who these companies are, who they lead, how long it took for them to scale and what support they require to grow. Companies tend to grow after reaching 50 employees, according to research. Scaled companies are more likely have founders who have specialized experience and are well connected with other founders. The purpose of the study was to provide insights into the sector’s current state, evaluate its strengths and weaknesses, and enable decision-makers to better understand and support local tech entrepreneurship. The Riyadh technology sector was visualized using social network analysis. This method allows you to trace the flow and capital of people and information between entrepreneurs, co-founders, employees and mentors, investors and other stakeholders. Network maps are based on the experiences of entrepreneurs and not secondary data. They highlight entrepreneurial assets and problems in a community and indicate opportunities for capital, talent, and markets. Lateefa Alwalaan, Managing Director of Endeavor Saudi Arabia, said: “We’ve witnessed firsthand at Endeavor the rapid growth of the tech ecosystem in Saudi and how valuable scaled companies are to the growth of any sector. It was important to us to document this growth and impact to better understand the ecosystem and to create a valuable tool to guide policymakers, VCs, and other stakeholders who support founders.” The Saudi ecosystem faces many challenges, including the difficulty of hiring tech talent. Many founders have relocated some of their operations to other countries, but the main objective of the ecosystem improvement is to create opportunities for Saudi citizens. The vast majority of the founders that participated in the study stated they needed to hire talent outside Saudi Arabia. Over 90% of them have tech teams located in other countries, in particular the MENA area. Many founders of Saudi Arabian businesses also mentioned plans to move their legal headquarters to the Middle East or to make acquisitions to address local market limitations. The research is supported by Riyad Bank as a strategic partner, Saudi Aramco Entrepreneurship Center (Wa’ed) as a supporting partner, OCEANX as an ecosystem partner, and also backed by Endeavor Saudi board members. Interactive network maps allow you to track the movements in the ecosystem. You can read the entire report and view the maps. here. Endeavor Saudi Arabia, a local affiliate to Endeavor (a non-profit organization that is the largest global community of, for and by High-Impact Entrepreneurs), was established in 2012. Endeavor creates a Multiplier Effect by inspiring high-growth founders to dream bigger, supporting and investing in them to scale faster, and providing a platform to pay it forward — thereby compounding their individual impact.