Happy Friday! Rumours swirled at last week’s FII8 that Saudi’s PIF is planning to launch an AI powerhouse to rival the UAE’s G42. Although no official announcement has been made, confidential sources confirm that this potential AI giant would have access to a mouth-watering $100 billion in funding.

In other news, our friend Ahmad Takatkah has officially launched Revenya Capital, a revenue-based finance venture in partnership with Arzan VC. With the growing need for non-dilutive financing options in the region, there’s no better man to lead the charge.

Enjoy this week’s edition 👇

This week’s round-up is a 5 min read:

• 🤖 Saudi government plans $100 billion AI initiative, Project Transcendence

• 💸 Arzan VC partners with Ahmad Takatkah to launch revenue-based financing firm, Revenya Capital

• 💰 SVC invests $20 Million in BECO Capital‘s Booster Fund IV

• 🔐 Shorooq leads Corgea's $2.6 million Seed round

• 🔈 Catch-up on Episode 17 of the VC React Podcast

🚀 Startup funding round-up

Mush Social (🇸🇦 KSA), a reward-based social media platform with virtual asset ownership, has secured $1.2 million in a pre-Seed round led by Nifal Consulting, with support from Nahr Al-Jazeera Holding, along with other angel investors.

Cathedis (🇲🇦 Morocco), a last-mile delivery logistics company, has raised $713k from Fond Capital Venture (FCV), the VC fund of BMCE Capital, and Beltone Venture Capital.

Warburg AI (🇦🇪 UAE), a platform that provides adaptive AI and machine learning solutions for financial institutions focused on algorithmic trading, real-time risk management, and asset optimisation, has secured $250k in Seed funding from undisclosed investors.

VC

Arzan VC partners with Ahmad Takatkah to launch revenue-based financing firm, Revenya Capital

💰 Arzan VC has partnered with Ahmad Takatkah to launch Revenya Capital, a revenue-based financing (RBF) firm aimed at supporting tech startups across the MENA region.

• With an initial seed investment of $2 million from Arzan VC and Arzan Financial Group (AFG), plus a credit facility from AFG’s network, Revenya Capital will seek to address the growing need for non-dilutive financing options in the region.

⏪ Background: Nearly a decade ago, Ahmad helped found the Arzan VC team. He later moved to the US, where he spent three years at Carta before serving as a Venture Partner at KingsCrowd. He also hosts the VC React Podcast.

⚙️ Break it down

Revenya Capital provides startups with short-term, non-dilutive funding, allowing them to maintain equity.

Designed for immediate needs like marketing, inventory, events, equipment, and seasonal expenses, the financing offers a flexible alternative to traditional VC funding.

By leveraging AI and machine learning, Revenya Capital can deliver rapid, data-informed financing decisions.

The firm is targeting high-growth startups with predictable revenue streams, offering 3 to 9-month loans between $50,000 and $500,000 with a fixed monthly fee of 1.5%-2.5% and repayment rates of 5%-20% of monthly revenue.

🔮 Flashforward

As one of only a few firms offering RBF in MENA, alongside companies like Erad, Capifly, FlapKap, and Flow48, Revenya Capital aims to collaborate with these players to expand access to non-dilutive financing options.

💰 VC & investing round-up

💸 SVC, a state-backed fund of funds, has invested $20 million in Booster Fund IV, managed by Dubai-based BECO Capital, with $495 million in AUM. To date, SVC has backed 50 private capital funds, supporting hundreds of ventures. BECO's fourth fund portfolio to date includes ClearGrid, BRKZ, Sirdab, Keyper, FlapKap, MALA, and Ejari.

🦾 US investment bank Z Capital Group is expanding into Saudi Arabia with plans to invest $1 billion in private equity, credit, and infrastructure, including a direct lending program for SMEs set to launch in early 2025. The group has chosen Riyadh as its MENA headquarters and appointed former Saudi Ministry of Investment advisor Mohammed Al-Dakmari as CEO of its Arab operations.

🌍 Global investments roundup

🔐 Corgea, an AI-powered cybersecurity startup, has raised $2.6 million in seed funding led by Shorooq, with support from Y Combinator, Propeller, and prominent angels like YouTube co-founder Jawed Karim. Founded by Ahmad Sadeddin, Corgea’s platform cuts false positives by 30% and accelerates remediation by 80%, enhancing security for teams in the US and Middle East.

🚀 Aramco Ventures has participated in a $10 million Series A-extension round for IOTA Software Inc., a US-based enterprise SaaS developer. Founded in 2023, IOTA’s cloud-native platform centralises critical business and operational data, helping industrial enterprises optimise asset performance. The round was led by Altira Group, with additional support also from Oxy Technology Ventures.

🛢️ Aramco Ventures has led a $21.7 million in Series B funding round for Andium, a U.S.-based IIoT company focused on oil and gas monitoring and remote communication. Additional support from Climate Investment and Intrepid Financial Partners. This brings Andium’s total funding to over $40 million.

🧪 Crescent Ventures, the corporate venture capital arm of UAE-based Crescent Enterprises, has joined a $10 million funding round for biotech firm CrossBridge Bio. The investment, co-led by TMC Venture Fund, Portal Innovations, and Alexandria Ventures, will advance CrossBridge Bio's CBB-120 drug for solid tumours and its dual-payload drug pipeline.

 🤖 AI round-up

🇸🇦 Saudi Arabia's Project Transcendence will aim to establish a government-backed AI group with up to $100 billion in funding. Structured similarly to the PIF’s Alat group, the initiative will invest in AI infrastructure, data centres, and startups, in partnership with global tech firms. The project will seek to centralise AI resources, create jobs, and grow local talent and the startup ecosystem. Industry watchers speculate that Project Transcendence may operate with a mandate similar to UAE AI powerhouse G42.

🤖 Microsoft announced plans to train one million UAE learners in AI skills by 2027, building on partnerships with Abu Dhabi, Dubai, and Sharjah to upskill 100,000 government employees. This move aligns with the UAE's AI 2031 Strategy to position the country as a global AI leader. Following a $1.5 billion investment in G42 and the launch of an AI for Good Lab and Responsible AI Centre, this initiative further underscores Microsoft’s commitment to supporting the UAE’s AI-driven future.

⛽️ ADNOC and AIQ, in collaboration with G42 and Microsoft, announced ENERGYai, an AI solution to accelerate energy transformation by combining ADNOC's data with advanced AI capabilities. Testing for this three-year initiative will begin in late 2024. Additionally, ADNOC awarded a $920 million contract to Jereh Oil & Gas to expand AI-powered digitalisation across its Bab, Bu Hasa, and Southeast fields.

💰 VC React Podcast: Episode 17

🎧 In this week’s episode, we covered PIF's pivot toward domestic investments and AI, Wa’ed Ventures’ new $100M fund for AI startups, and Invygo’s $8M Series A extension backed by STV’s NICE Fund. We discussed the implications for local startups, Saudi Arabia’s AI ambitions, and the appeal of non-dilutive funding models for founders.

⭐️ Opportunities

🇱🇧 Opportunity for Lebanese Startups!

The EBRD’s Star Venture Programme offers high-potential Lebanese startups a grant of up to €50,000 plus 18 months of tailored support, including workshops, mentorship, and market access. This EU-funded initiative prioritizes startups focused on R&D or deep tech.

Apply by November 15, 2024 if you:

🚀 Are Lebanese-owned with < €1M turnover
📈 Have high growth potential and scalability
🔬 Focus on R&D or deep tech