SVC invests $30m in IMPACT46 Fund III to support pre-IPO companies

SVC CEO Dr. Nabeel Koshak and IMPACT 46 Founder Abdulaziz Alomran signing the agreement. Supplied
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Updated 04 October 2023
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SVC invests $30m in IMPACT46 Fund III to support pre-IPO companies

RIYADH: As part of its commitment to minimize financing gaps for startups, Saudi Venture Capital Co. has invested SR112.5 million ($29.9 million) in IMPACT46 Fund III. 

According to a press release, the move is designed to empower late-stage companies in the region by investing in growth and pre-initial public offering phases.

A late-stage company is a business that has been in operation for a few years and has demonstrated viability. 

The release added that the trust will aim to allocate a specific amount for early-stage startups, focusing primarily on seed rounds in the broader Middle East. 

“The investment in IMPACT46’s Fund III falls under the company’s fund investment program, which aims to enhance the growth of the venture capital ecosystem for startups in the Kingdom across all stages and sectors,” said SVC CEO Nabeel Koshak in a statement. 

“This is in line with the growth witnessed by the venture capital sector in the Kingdom over the past years, making it a leader in venture capital in the Middle East and North Africa in the first half of 2023 in terms of invested amounts,” Koshak added. 

The Kingdom clinched the top spot in venture capital value for the first half of 2023, registering investments that surpassed $446 million, the highest in the MENA region. 

“We are delighted that SVC and IMPACT46 are once again joining forces, this time with our Fund III, which aims to support the growth of the tech startup ecosystem in Saudi Arabia. This partnership demonstrates our commitment to achieving our shared vision for driving a sustainable economic impact,” said IMPACT46 CEO and Founder Abdulaziz Al-Omran in the statement.

“This investment not only signifies the growing maturity of the VC activity in Saudi Arabia but also highlights the Kingdom’s potential to emerge as a frontrunner in this sector,” Al-Omran added. 

Founded in 2018, SVC operates under the umbrella of the SME Bank and the National Development Fund.  

SVC has channeled its resources and efforts toward empowering startups with an investment portfolio that boasts $2 billion. 

The company’s reach encompasses 43 investment funds and over 700 startups and small and medium enterprises, firmly positioning itself as a catalyst for entrepreneurial growth. 

Furthermore, IMPACT46 is a Saudi-based venture capital company that invests from seed-stage startups to more mature businesses. 


Arab-Turkish economic ties flourish with $55bn intra-trade 

Updated 36 min 40 sec ago
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Arab-Turkish economic ties flourish with $55bn intra-trade 

RIYADH: Arab-Turkish economic relations are continuing to progress at all levels, with the volume of intra-trade standing at $55 billion, as stated by the secretary-general of the Union of Arab Chambers.  

Khaled Hanafi added that exports from the Turkish nation are increasing annually by about 10 percent, and the presence of direct and indirect Arab investments in Turkiye has grown significantly in recent years. 

The discussion took place during the fifth joint meeting of the Arab and Turkish Chambers, convened in Egypt. The event was attended by numerous heads of chambers of commerce and industry leaders from Arab nations and Turkiye. 

 


QatarEnergy to further boost LNG production from North Field 

Updated 25 February 2024
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QatarEnergy to further boost LNG production from North Field 

DOHA: QatarEnergy chief Saad al-Kaabi announced on Sunday a new expansion of its liquefied natural gas production that will add a further 16 million tonnes per annum to existing expansion plans, bringing total capacity to 142 mtpa. 

With this added boost, the overall expansion of the North Field from 77 mtpa currently to 142 mtpa by 2030 represents an increase of 85 perecnt in production, Kaabi said at a press conference in Doha. 

Qatar is among the world’s top exporters of LNG, competition for which has ramped up since the beginning of the war in Ukraine in February 2022. 

This latest expansion may not be the last for the energy giant as Kaabi said appraisal of Qatari gas reservoirs would continue and production would be further expanded if there is a market need. 

State-owned QatarEnergy has already signed a string of supply deals with European and Asian partners in its massive North Field expansion project, which was expected — prior to Sunday's announcement — to produce 126 million mtpa of LNG per annum by 2027, from the current 77 mtpa. 

Exploration activities in the west of North Field prompted the company’s decision to expand further. 

Kaabi did not give a cost for the project but said it would be in the billions of dollars. 

“It is difficult to give you a number now for the cost of the expansion, but it is certainly in billions,” he said. 

“We will start preliminary engineering studies for the project and then at the right time we will announce how much is the cost when the project is settled.” 

In December, Kaabi told Reuters that QatarEnergy had been drilling wells to assess expansion opportunities beyond the North Field East and North Field South phases. 

This latest expansion will require the construction of two LNG trains, in addition to six already underway for the earlier expansions dubbed North Field East and North Field South. 

The North Field is part of the world’s largest gas field which Qatar shares with Iran, which calls its share South Pars. 

GAS MARKETS 

Kaabi said global markets still need more gas even after this further expansion saying that Asian market growth was driven by population growth and European markets would still need gas for a “long time” despite the energy transition. 

The Qatari announcement comes as US gas prices trade near an all-time low if adjusted to inflation after a decade of meteoric rise in output which made the US one of the top oil and gas exporters. 

Prices of gas in Europe also fell steeply despite a drop in Russia supplies after the US and Qatar helped replace lost volumes. 

Despite the price drop all major gas producers including the US, Australia and Russia want to further increase output betting on a further demand growth and worries that their gas might not be needed decades from now if energy transition makes green energy cheaper. 


Egypt’s GDP growth projected at 5.1% by 2026 despite challenges: OECD  

Updated 25 February 2024
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Egypt’s GDP growth projected at 5.1% by 2026 despite challenges: OECD  

RIYADH: Egypt’s gross domestic product is expected to gradually increase to 5.1 percent by 2025 and 2026, driven by growing consumption, according to a report.  

In a recent release by the Organization for Economic Co-operation and Development, Egypt’s economic growth is projected to face challenges amidst soaring inflation rates, necessitating urgent reform efforts to revitalize the private sector and attract investment. 

According to the OECD’s inaugural Economic Survey of Egypt, the country’s GDP growth is set to ease to 3.2 percent in fiscal year 2023-24 before increasing gradually to 5.1 percent by fiscal year 2025-26. 

“Growth is expected to be driven by growing consumption, provided inflation subsides and despite the gradual withdrawal of fiscal support,” the report stated. 

It added that the investment will stay weak as long as financing conditions remain tight in the continuing fight against inflation. At the same time, export growth is expected to increase if geopolitical tensions in the region recede. 

OECD Secretary-General Mathias Cormann underscored the urgency of controlling inflation to stimulate consumption and foster growth, saying: “Bringing inflation under control is now a key near-term priority to spur consumption and strengthen growth. Monetary policy needs to remain restrictive until inflation comes back to target.” 

He added: “A comprehensive consolidation strategy is needed to improve investor confidence in public finances and ease financing conditions. Stepping up structural reform efforts, building on previous reforms, to reinvigorate private sector activity and investment by removing administrative barriers, ensuring a level-playing field between private and state-owned companies and stepping up the fight against corruption will help boost productivity and long-term growth.” 

Despite initially weathering the storm of the COVID-19 pandemic and global food price hikes better than neighboring countries, Egypt has faced a setback, with domestic inflation soaring to record levels of 40.4 percent in September 2023, compared to 15.3 percent a year earlier.  

The analysis said that this surge in inflation has adversely affected consumption, weakened the domestic currency, and dampened investment, consequently leading to a slowdown in growth. 

Fiscal support measures, including targeted cash-transfer programs, have relieved the most vulnerable segments of society.  

However, businesses have been grappling with rising interest rates and limited access to foreign currency, hampering economic activity. While inflation has started to decline gradually, standing at 31.2 percent in January 2024, challenges persist in restoring stability. 

The report urged the government to address significant financing needs, indicating that despite targeting a 2.5 percent GDP primary budget surplus in the 2023-24 budget, the overall deficit will stand at -7.5 percent due to high-interest payments.  

International market funding has been limited since early 2022 when increased volatility in global financial markets led to strong capital outflows. “Restoring investor confidence in public finances is essential to attract international capital and bring down debt service costs,” the study added. 

Egypt’s vulnerability to climate change was also addressed in the report, with an urge to accelerate efforts toward mitigation and adaptation measures. Gradual reduction of untargeted energy subsidies was recommended to alleviate emissions and the budget deficit. 

The report emphasized the role of private investment and international support in advancing climate-related financing and facilitating the green transition. 

In conclusion, the OECD study underscored the need for concerted efforts to address Egypt’s economic challenges.  

By implementing comprehensive reforms and fostering a conducive environment for private sector growth, Egypt can navigate the current slowdown and pave the way for sustained economic prosperity.


Saudi Arabia unveils major gas discovery in Jafurah Field: Ministry of Energy 

Updated 25 February 2024
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Saudi Arabia unveils major gas discovery in Jafurah Field: Ministry of Energy 

RIYADH: Saudi Arabian Oil Co. has discovered an additional 15 trillion standard cubic feet of gas in the Kingdom’s Jafurah Field. 

According to a press statement from the Ministry of Energy, the discovery also includes 2 billion barrels of condensate. 

With the latest discovery, the quantity of resources in the field has become 229 trillion standard cubic feet of gas and 75 billion barrels of condensate, the ministry added in the press statement, citing the Kingdom’s Energy Minister Prince Abdulaziz bin Salman. 

This discovery made by the energy giant, also known as Saudi Aramco, was a result of applying the highest international standards in estimating and developing hydrocarbon resources to ensure their proper exploitation, the statement added.  

In November 2023, the Ministry of Energy announced that Saudi Aramco had discovered two new gas fields in the Eastern Province and the Empty Quarter respectively. 

In a press statement, the ministry said the first discovery occurred at the Hanifa reservoir in the Al-Hiran-1 well.  

It reported that the field was discovered after gas flowed at a rate of 30 million scf per day from the said reservoir, along with 1,600 barrels of condensate.  

The second discovery was made at the Al-Mahakek-2 well, where the natural resource flowed at 0.85 million scf per day. 

The ministry added that gas was also discovered in five other reservoirs in previously discovered fields, including the Jalla reservoir in the Assekra field, where gas flowed at a rate of 46 million scf per day.  

In November, Saudi Aramco also began the production of unconventional tight gas from its South Ghawar operational area, two months ahead of its schedule. 

Unconventional tight gas, also known as shale gas, is typically found in reserves where hydrocarbons are tightly trapped within rock layers.  

Extracting this resource demands specialized techniques like horizontal drilling and hydraulic fracturing. 

The commissioned facilities at South Ghawar currently have a processing capacity of 300 million scf per day for raw gas and 38,000 barrels per day for condensate. 

Earlier in February, speaking at the International Petroleum Technology Conference in Dhahran, Amin H. Nasser, CEO of Saudi Aramco, said that the company is eyeing continuity in the production of all types of energy, including oil and gas, along with renewables.  

He also added that Aramco has the full capability to grow in any sector to create profitable companies. 


Startup of the Week – supply chain platform Omniful aims to boost Saudi Arabia’s e-commerce space

Updated 24 February 2024
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Startup of the Week – supply chain platform Omniful aims to boost Saudi Arabia’s e-commerce space

  • CEO addresses market challenges and evolving customer expectations

CAIRO: E-commerce and supply chain operations platform Omniful is aiming to significantly boost its presence in the Saudi market after a successful $5.85 million seed funding round.

In an interview with Arab News, CEO and co-founder of Omniful, Mostafa Abolnasr, shared the company’s strategies aimed to boost Saudi Arabia’s e-commerce space.

“Following our recent seed funding round, we plan to scale our operations, expanding our market presence in Saudi Arabia and internationally, and continuing to aggressively invest in technology development,” Abolnasr said.

“This includes enhancing our platform’s capabilities, entering new strategic partnerships, and further tailoring our solutions to meet the specific needs of diverse markets,” he added.

FASTFACT

Mostafa Abolnasr aspires for his company to become a globally recognized technology vendor originating from the region, addressing local and global market challenges while contributing to the ecosystem.

Abolnasr detailed the company’s strategic positioning within the Saudi e-commerce market, emphasizing its focus on being a key enabler for the sector “with features tailored to local business practices, regulatory requirements, and consumer preferences.”

He added: “For example, we are the first Order Management System to combine sales channels like Salla, Zid, Jahez, PIK, Amazon, Noon, ToYou and others - all selling from the same inventory on the store shelves.”

On the topic of strategic partnerships, Abolnasr shared that while specific collaborations remain confidential, Omniful actively engages with both private and public entities in Saudi Arabia.

These partnerships aim to align Omniful’s operations with the national e-commerce strategy, enhancing the overall ecosystem and supporting the company's expansion plans.

Addressing market challenges and evolving customer expectations, Abolnasr stated that Omniful prioritizes innovation based on first-principle analysis, focusing on long-lasting solutions that address fundamental pain points within the supply chain and e-commerce sectors.

Regarding international expansion, Abolnasr revealed that Omniful already serves clients across various regions, including the US, Europe, Africa, Turkiye, and the Gulf Cooperation Council.  

Omniful’s partnerships aim to align its operations with the Kingdom’s national e-commerce strategy. (Supplied)

“These came mostly through referrals, partnerships, conferences and inbound - since until today, we have not yet activated our marketing and outreach efforts for international expansion, as we are planning a launch in strategic markets across the Middle East and North Africa region, and internationally,” he stated.

“An attractive market for us is one that is rapidly expanding e-commerce penetration, and combined with a lot of supply chain and operational challenges - a formula that breeds the need for a sophisticated suite of solutions like ours,” added the CEO.

Abolnasr’s vision for Omniful aligns with the anticipated growth of e-commerce both in Saudi Arabia and globally.  

He aspires for his company to become a globally recognized technology vendor originating from the region, addressing local and global market challenges while contributing to the ecosystem.

To maintain its competitive edge, Omniful relies on its proprietary technology and strong engineering capabilities, drawing talent from leading companies to build Software-as-a-Service products.  

“We plan to double-down on this and make sure that tech continues to be our competitive edge by investing in research and development, fostering a culture of innovation, and staying responsive to customer needs and industry trends,” Abolnasr said.

“We are also enhancing our platform with AI, machine learning, and other emerging technologies to deliver unparalleled efficiency and value to our clients in different use-case across inventory optimization, allocation, and demand forecasting,” he added.

Founded in 2022 by Abolnasr and Alankrit Nishad, Omniful provides merchants and fulfilment providers with a unified management system, warehouse management system, and transport management system to scale their businesses.

Abolnasr described the company’s role in transforming the omnichannel and e-commerce supply chain and operations landscape, highlighting  Omniful’s cloud-native, end-to-end platform, which integrates order, warehouse, and transport management systems functionalities.

“Omniful targets critical and common pain points such as inventory mismanagement, inefficiencies in order processing, lack of real-time data integration across sales channels, and the complexities of managing multiple fulfillment hubs be it stores or warehouses and shipping partners,” Abolnasr told Arab News.

“By providing a unified platform, we address these challenges directly, reducing fulfillment delays, minimizing operational costs, increasing real-time visibility and improving overall customer satisfaction,” he added.

Omniful’s strategy starts with real-time inventory management that spans multiple sales channels, effectively coordinating across various stores and warehouses.

The platform is designed to integrate seamlessly with existing enterprise resource planning and point of sale systems, ensuring updates are timely and accurate.  

Abolnasr further highlighted the functionality of the company’s order management system, which automates the routing, assignment, and tracking of orders.  

He also pointed out the agility of its warehouse management system, tailored for high-volume throughput optimization, and shipping and fulfillment automation rules that facilitate smooth courier selection and tracking.

These capabilities, according to Abolnasr, are key to ensuring timely and complete order delivery, maintaining precise inventory levels, and significantly improving the shopping experience for both businesses and consumers.

The shared frustrations the founders had with the lack of scalable, efficient, and modular platforms in the market led them to create Omniful.  

Abolnasr explained that their aim was to develop the world’s premier supply chain platform, offering adaptable solutions to meet the specific needs of businesses navigating the dynamic terrain of supply chain, e-commerce, and omnichannel operations.

Abolnasr shed light on the significant trends influencing the future of e-commerce logistics and fulfillment, emphasizing the shift towards omnichannel retail and the increasing consumer demand for fast, same-day delivery.  

He highlighted the critical role of artificial intelligence and machine learning in driving predictive analytics and optimization, alongside the necessity for businesses to diversify sales channels and enhance their merchandising and demand generation efforts.

“These technologies enable inventory optimization, efficient picking routes, predictive analytics, demand forecasting, intelligent routing, shipping courier selection, and warehouse space utilization, leading to increased efficiency, reduced costs, and improved customer experiences,” he stated.

Abolnasr elaborated on Omniful’s strategic growth and its alignment with the broader digital transformation and economic diversification efforts within Saudi Arabia.  

“Our focus remains on supply chain and e-commerce operations, which puts a lot of confidence in the e-commerce sector’s potential and underscores our commitment to supporting the region’s vision for a technologically advanced and economically vibrant e-commerce ecosystem,” he said.