Who Are the Top Angel Investor Groups in Saudi Arabia?
What are Angel Investors
Angel investors are individuals, usually affluent people who lend money to start-up businesses, typically in return for ownership equity or convertible debt. Angel investors tend to offer more than simply cash assistance; providing direction, knowledge, and beneficial connections to aid the firms they invest in. Angel investors are also known as informal investors, angel funders, private investors, seed investors or business angels.
Compared to Venture Capital (VC) firms, angel investors focus on making smaller investments in early-stage ventures, often in the pre-seed stage. They may also be more willing to take risks on unproven ideas. Unlike VCs, who use money from other investors, angel investors fund entrepreneurs with their own capital.
Origin of The Term “Angel Investors”
The term "Angel Investor" was coined in 1978 by William Wetzel, the founder of the Centre for Venture Research and a professor at the University of New Hampshire. The term originated from the practice of affluent individuals providing funding for theatrical productions on Broadway, which was paid back with interest once the productions started generating revenue. Wetzel used the term to describe investors who supported start-up businesses with seed capital.
Angel Investor Groups in Saudi Arabia
Before 2018, there were only a few venture capital firms operating in the Kingdom, but the ecosystem had started to gain momentum with fund of funds like Jada and SVC injecting capital into first-time funds and co-investing in start-ups to de-risk and incentivize investments. Since 2017, the number of local VCs have ballooned, predominantly investing in seed-stage and early-stage start-ups.
Today, there are over 65 VC firms, fund of funds, angel groups, incubators and accelerators that are headquartered in Saudi Arabia and whom have invested in one startup or another.
In this article, we have listed some of the most notable and active Angel Investor Groups in Saudi Arabia, in no particular order:
1. OQAL Angel investors Network
OQAL was the first angel investor network established in the Kingdom in 2011. OQAL is an endowment that was founded by Faris Al-Rashed in his home after meeting with a group of friends and acquaintances who shared the same passion and experience in developing and scaling promising entrepreneurial companies. Today, it boasts over 200 members from across Saudi Arabia and the GCC. OQAL is the conjunction of two Arabic words: Minds (Oqool) and Capital (Amwal).
Based on publicly available data, OQAL has completed 34 deals to date across MENA, with the majority of deals (22) being made on Saudi start-ups. OQAL’s most active funding year was 2019, when it completed 16 deals – 11 of which were for Saudi start-ups. It is estimated that OQAL has deployed over US$11 million in venture capital since its founding.
WomenSpark was founded in 2013 as the first female angel investor network in the Kingdom. WomenSpark was founded by Deemah AlYahya, a digital economy enthusiast who has spent the past 20 years focused on growing the developer community and tech ecosystem in Saudi Arabia, in various corporate and government roles. In 2021, WomenSpark made 5 investments totalling over 1 million SAR. Four of the startups were led by female founders. It is estimated that WomenSpark has deployed nearly US$1 million since its founding.
Athaal is an angel investor group founded in 2018 and based in Jeddah, that invests across the MEA region. It is estimated that Athaal’s angel investors have invested over US $1.5 million.
4. Riyadh Angel Investors
Riyadh Angel Investors (RAI) consists of over 50+ members who are top executives at leading corporations across the Kingdom. RAI angels average a $10K to $100K cheque size per investor on deals, which target startups across the MENA region in the Seed stage, post MVP. To date, RAI have invested in 8 startups, and have deployed an estimated US$1.7 million.
Also Read: Top Accelerators in Saudi: A Guide to the Most Notable Programs for Startups
Learn more about some of the most prominent Investors in Saudi’s startup ecosystem, in the most comprehensive report on the topic to date, The Evolution of Saudi Arabia's Start-Up Ecosystem 2010-2022.