Derayah Commits $65M to HOF Capital as It Plans Its Own AI Fund

HOF Capital co-founders: Onsi Sawiris, Hisham Elhaddad, and Fady Yacoub

Saudi Arabia’s Derayah Financial has committed up to $65 million (SAR 244 million) to HOF Capital Strategic Opportunities Fund II, targeting AI, enterprise software, and frontier technologies. Derayah paid 40% at closing and plans to launch its own AI and technology fund, potentially expanding its asset management and private markets business.

Why Is Derayah Financial Investing $65 Million in HOF Capital?

Saudi financial services company Derayah Financial has committed up to $65 million (SAR 244 million) to HOF Capital Strategic Opportunities Fund II (Cayman), L.P., increasing its exposure to global technology and artificial intelligence investments. The binding commitment was entered into on August 28, 2026, according to a disclosure to the Saudi Exchange (Tadawul).

The investment forms part of Derayah’s strategy to expand its asset management offering, particularly across private markets and high-growth technology sectors.

The fund, managed by HOF Capital Management, LLC, is targeting SAR 4.5 billion ($1.2 billion) in total commitments, with a hard cap of SAR 5.625 billion ($1.5 billion). It is expected to build a portfolio of approximately 15 companies across three core areas:

• Artificial intelligence (AI)
• Enterprise software
• Frontier technologies

The fund’s investment thesis is centered on AI adoption and growing demand for AI-enabled technologies and solutions.

How Much Has Derayah Already Invested in the Fund?

Derayah will deploy its SAR 244 million ($65 million) commitment over time rather than funding the entire amount upfront.

At the August 28, 2026 closing, SAR 97.5 million ($26 million) was called, representing 40% of the total commitment. The remaining 60% is expected to be drawn over the following 24 months, although the timing and individual tranche amounts may vary depending on the fund’s deployment requirements.

Investment Detail	Amount / Structure
Total Derayah commitment	SAR 244M / $65M
Paid at closing	SAR 97.5M / $26M
Paid at closing	40%
Remaining commitment	60%
Expected drawdown period	24 months
Fund target size	SAR 4.5B / $1.2B
Fund hard cap	SAR 5.625B / $1.5B
Expected portfolio	~15 companies

The investment will be financed through Derayah’s own resources and available credit facilities.

What Will HOF Capital Strategic Opportunities Fund II Invest In?

HOF Capital Strategic Opportunities Fund II is designed to invest in companies positioned around the expansion of AI and other advanced technologies.

Its investment focus covers:

1. Artificial intelligence: Companies developing AI-enabled products, platforms, and solutions.
2. Enterprise software: Technology businesses serving organizational and business workflows.
3. Frontier technologies: Emerging technologies with the potential to create new markets or reshape existing industries.

The fund expects to make approximately 15 investments, although the final portfolio size remains at the discretion of HOF Capital Management and will depend on available opportunities and the fund’s strategy.

For Derayah, investing through a diversified fund provides exposure to multiple global technology companies through a single investment vehicle rather than concentrating capital in individual companies.

Is Derayah Planning Its Own AI and Technology Fund?

Yes. Derayah plans to launch a multi-strategy fund focused on AI and technology, subject to obtaining the required regulatory approvals.

The move could be more significant for Derayah’s business than the initial SAR 244 million commitment itself.

Following the launch of the new fund, Derayah intends to transfer its investment in HOF Capital Strategic Opportunities Fund II to the new vehicle. The new fund would then be managed by Derayah’s own asset management team, giving the company a more direct role in managing technology investments.

This would shift Derayah’s position from simply being an investor in a third-party technology fund toward developing and managing an investment product of its own.

How Could the New Fund Generate Revenue for Derayah?

The planned fund could create a new revenue stream for Derayah through subscription and management fees, provided the vehicle is established, launched, receives the necessary approvals, and is successfully placed with its targeted investors.

That makes the HOF Capital commitment strategically important beyond its immediate investment value.

Derayah is effectively using the initial fund exposure as part of a broader expansion of its private markets and technology-focused asset management capabilities.

The company’s 2025 annual report also shows an existing focus on technology investing. In 2025, Derayah introduced a Shariah-compliant private closed-ended fund investing through the HOF Capital Strategic Opportunities Fund, targeting high-growth technology sectors.

What Does Derayah’s $65 Million Commitment Mean for Saudi Technology Investing?

The transaction highlights the growing role of Saudi financial institutions in providing investors with access to global private technology markets.

Derayah’s $65 million commitment gives it exposure to a fund targeting $1.2 billion in commitments, while its planned AI and technology fund could eventually allow the company to bring similar opportunities directly to its own investor base.

The more consequential development, therefore, may not be the initial capital commitment. It is Derayah’s attempt to build technology-focused investment products under its own asset management platform.

If approved and successfully launched, the new fund could strengthen Derayah’s presence in private markets while creating additional fee-based revenue from AI and technology investment products.

For Saudi Arabia’s financial sector, the move also reflects an expanding appetite for exposure to global AI, enterprise software, and frontier technology companies through institutional investment vehicles.

What Are the Key Takeaways From Derayah’s HOF Capital Investment?

The transaction can be summarized in five figures and developments:

• $65 million: Derayah’s total binding commitment to HOF Capital Strategic Opportunities Fund II.
• 40%: Portion called at the August 28, 2026 closing.
• 24 months: Expected period for drawing the remaining commitment.
• $1.2 billion: Target size of HOF Capital Strategic Opportunities Fund II.
• ~15 companies: Expected number of investments across AI, enterprise software, and frontier technology.

The next milestone will be Derayah’s proposed AI and technology multi-strategy fund, which remains subject to regulatory approval.

If launched as planned, the initiative could turn a SAR 244 million fund commitment into a broader technology investment platform managed directly by Derayah—deepening its private markets strategy while opening a potential new source of asset management revenue.

 

 

FAQs

1. How much is Derayah Financial investing in HOF Capital?
Derayah Financial has made a binding commitment of up to SAR 244 million ($65 million) to HOF Capital Strategic Opportunities Fund II. It paid SAR 97.5 million ($26 million), or 40%, at the August 28, 2026 closing.

2. What does HOF Capital Strategic Opportunities Fund II invest in?
The fund focuses on artificial intelligence, enterprise software, and frontier technologies. It is targeting SAR 4.5 billion ($1.2 billion) in commitments and expects to make approximately 15 investments.

3. Is Derayah launching its own AI investment fund?
Derayah plans to launch a multi-strategy fund focused on AI and technology, subject to the required regulatory approvals. The company intends to transfer its HOF Capital investment into the new fund after launch.

4. How will Derayah finance its $65 million commitment?
Derayah will finance the commitment through its own resources and available credit facilities. Forty percent was called at closing, while the remaining 60% is expected to be drawn over 24 months.

5. Why is the investment important for Derayah?
The investment supports Derayah’s strategy to expand its asset management and private markets activities. Its planned AI and technology fund could also generate subscription and management fee income if successfully launched and placed with investors.