Alibaba, PIF-backed fund to raise US$1 billion for tech deals

A VENTURE capital fund that is backed by Saudi Arabia’s Public Investment Fund (PIF) and China’s Alibaba Group is close to raising US$1 billion to back technology startups in Asia and the Middle East.

“Saudi has a very big market and China has Internet and technology companies that are preparing to expand globally, so one hand has the market, and the other hand has the technology,” eWTP Arabia Capital founding partner Jerry Li said in an interview in Riyadh.

Founded in 2019, the fund raised US$400 million for deals that year. It has already invested in 16 companies and plans to list three of them on the Saudi stock exchange and two in the US next year, Li said.

Existing investors in the first fund will be major contributors in the second funding round along with other international investors, he said. The firm will likely raise new funding every two years as it already has a large pipeline of potential deals.

“We are currently working on 20 projects in the fields of technology, logistics, and infrastructure; half of them are based in Saudi Arabia,” Li said.

The PIF has been ploughing money into tech firms and startups as it seeks to build a venture capital industry and encourage young entrepreneurs to set up their own businesses to diversify the economy and create jobs. It created a US$1 billion fund of funds for venture capital firms and also invests directly through its subsidiary, Sanabil.

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Last year eWTP was one of the investors behind SCCC Alibaba Cloud, a cloud computing business that also counts Saudi Telecom, Alibaba Cloud, and the Saudi Company for Artificial Intelligence among its backers. BLOOMBERG