There is no doubt that the emerging companies in the field of technology in Saudi Arabia are on the rise, as ArabNet has deepened the network of emerging institutions in the Kingdom and launched a detailed report entitled "Innovation Economy in the Kingdom – Emerging Companies in Technology 2017". The report is available for download from here.
One of its objectives was to highlight the gaps and strengths of this network to provide anyone with an interest in investing in incubators, accelerators, and extension programs or launch them with a clear database.
To do so, a questionnaire was conducted for founders, partners and employees who have shares in digital and technology start-ups in the Kingdom and analyzed through several pillars of the Babson Global Entrepreneurial System:
It seems that emerging tech companies in Saudi Arabia rely mainly on non-equity financing. The results of the survey showed that more than half of the start-up companies rely on their personal savings (56%), while one out of every 10 emerging companies (11%) and 11% .
However, equity financing in the Saudi market was low with the business sponsors' network, which is the most sought after source (24%), followed by business accelerators (11%) and venture capital (9%).
The possible reason for this may be the Kingdom's lack of knowledge of capital sources, making it a clear market aimed at resorting to more business accelerators and investment capital.
One person can not do it all
The Saudi system does not lack basic services such as teaching work skills (33%) and available work spaces (31%). However, emerging companies that responded to the questionnaire agreed that they faced difficulties in receiving guidance support in terms of legal and accounting advice (36%), communication with potential customers (35%), and target market strategies (29%).
Similar results have emerged with respect to the availability of talent and technical skills. Key business skills such as marketing, media, and communications seem to be prevalent among more than half of startups. However, the less technical services are available, such as development and encryption (11%), product design (7%), and data and analysis (2%).
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The results in this section revealed that most emerging Saudi companies have had difficulty getting new business due to lack of support from attraction marketing and financial considerations. For example, emerging companies that were surveyed identified the need for advertising from influencers (47%) or marketing by speech (34%), as well as marketing and sales budgets (43%).
In brief ..
After this in-depth research, we noticed that the two biggest challenges facing the Saudi market are getting funding and finding local Saudi talent. On the positive side, however, half of the surveyed companies claimed that the technical infrastructure is very strong, while a quarter of these companies said that attracting new business was a strong challenge.
This year, ArabNet will dive into the Kingdom's ecosystem with the 7th edition of ArabNet Riyadh under the theme "The Rise of the Kingdom of Innovation" on December 12 and 13. Thousands of digital business leaders, business leaders and investors will gather in Riyadh, where two events will take place simultaneously: "ArabNet Riyadh" for more than 1000 corporate executives and senior government officials, From business, youth and students.