Saudi Arabia's entrepreneurial ecosystem maintained its growth momentum in Q3 2022 with 978,445 SMEs now registered in the Kingdom, up from 892,063 in Q2, a 9.7% increase, Monsha'at's new SME Monitor report reveals. With the number of registered SMEs almost reaching the 1 million milestone, the Kingdom's entrepreneurial ecosystem continues to attract entrepreneurs and investors across different sectors. This growth is the result of strong SME-friendly policies put in place since 2016. By increasing access to capital and offering and increased upskilling and specialized training to help people grow their businesses, entrepreneurial culture has taken root in the Kingdom. This has led to increased businesses activity across traditional and new sectors. Dedicated policies to invest in emerging technologies have also spurred innovation and job creation. These regulatory strategies and initiatives to stimulate the digital economy are already drawing the attention of venture capitalists. Throughout the Kingdom, VC funding totaled SAR3.1 billion in the first three quarters of 2022—a 93% year-on-year increase. Investment in FinTech was especially strong, with 22 deals in Q3 signaling a 266% year-on-year increase. The report also highlights key regional SME trends in the Al-Jouf province, where renewable energy, tourism, and agriculture are driving SME growth in multiple sectors. Home to more than 20 million olive trees across 52,000 acres, the province also boasts the Dumat Al Jandal wind farm, which has a generation capacity of 400MW, and the Sakaka PV solar plant project, which is expected to generate 300MW of power upon completion. Its proximity to the Jordanian market has also spurred new business creation across multiple sectors. Ambitious initiatives and increased investment in ICT and emerging technologies have also led to new SME growth. Monsha'at's Thakaa Center, for example, is investing SAR 335 million ($89 million) to help over 90 tech startups and 250 SMEs integrate advanced technologies into their business. The National Strategy for Data and AI is aiming to grow the digital economy and support high-tech enterprises by investing SAR 75 billion in AI through 2030. Its aim is to create 300 AI-driven startups, train 20,000 AI and data specialists, and create 40,000 new jobs by the end of the decade. As the latest SME Monitor shows, SME creation continues to rise as new investments in FinTech, VC, e-commerce, and AI and other emerging technologies increase the digital competitiveness of the Saudi economy, which lifts its productivity, creates new networks and markets, and cultivates a more tech-driven entrepreneurial culture among SMEs.
