Saudi Arabia is undergoing a profound structural transformation aimed at diversifying its economy away from oil and positioning the kingdom as a hub for startups and international businesses.
This shift is being driven by Vision 2030, a development plan that couples bold regulatory reforms with sovereign-backed capital, a new guide produced by the Saudi Ministry of Investment in collaboration with Invest Saudi, the country’s nation-wide investment brand, says.
The guide, released in February 2026, highlights how Saudi Arabia is solidifying its status as a leading startup hub in the Middle East and North Africa (MENA) region. It notes that this burgeoning startup ecosystem rests on several key shifts.
First, the knowledge-based economy now totals about US$132 billion, and more than a US$1 billion has been invested across artificial intelligence (AI), deeptech, and data centers, reflecting rapid expansion across high-impact fields.
Second, the investment landscape is maturing, with over US$3.4 billion raised by Saudi tech startups since the start of 2023. Of that, US$1.66 billion was committed in 2025 alone, indicating accelerating capital flows.
Moreover, Saudi Arabia has outpaced its regional peers, captured more than 55% of MENA venture capital (VC) funding for three consecutive years, underscoring its leadership in the region’s tech financing.
Accompanying this shift is the acceleration of tech adoption in traditional market. In healthcare, more than 224 facilities are now connected through Seha, the national digital health system and virtual hospital network, while the Sehhaty app engages 31 million users, or nearly 88% of the kingdom’s population.
In the financial arena, electronic payments now account for nearly 80% of all retail transactions, a milestone which reflects strong momentum in cashless payment methods. It also shows that the kingdom has already surpassed its 70% cashless target for 2025.
Fintech among the most promising sectors in Saudi
Within the Saudi startup ecosystem, the fintech industry is expanding rapidly. In H1 2025, the kingdom hosted 281 fintech companies, up from 261 in 2024. Projections estimate that 525 fintech companies will operate in Saudi Arabia by 2030, reflecting sustained growth.
Besides fintech, cybersecurity is another tech category that’s gaining momentum. Saudi Arabia ranks first globally in cybersecurity according to the 2025 World Competitiveness Yearbook published by the International Institute for Management Development. This leadership is attributed to its robust government support, comprehensive national strategies, and dedicated institutions. Today, more than 21 million Saudi nationals work in cybersecurity, and the market’s size is estimated at US$5.1 billion.
E-commerce and retailtech is another flourishing industry, thanks to the kingdom’s near universal Internet connectivity and booming online shopping activity. Internet penetration reached 99% in 2024, creating a fertile ground for digital commerce. According to market research firm IMARC, Saudi Arabia’s e-commerce market was valued at US$22.9 billion in 2024, with projections indicating it will reach US$708.7 billion by 2033, reflecting a compound annual growth rate of 12.8%.
Industry enablers
Vision 2030 is driving this overall transformation, while the Ministry of Investment supports the startup ecosystem and facilitates the setup and expansion of international companies in Saudi Arabia, through clear processes, digital systems, and direct institutional coordination.
The authority’s flagship initiative, the Startup Saudi Program, is a comprehensive national initiative designed to accelerate entrepreneurial growth and transform Saudi Arabia into a regional innovation powerhouse. It connects companies with venture capital, giga-projects, and corporate innovation units for faster business development.
The Ministry of Communications and Information Technology (MCIT) serves as another key enabler of the tech startup landscape. The department leads Saudi Arabia’s digital transformation agenda through the development of digital infrastructure, the cultivation of technical talent, and programs that support local and international startups.
MCIT runs the Center of Digital Entrepreneurship (CODE), which supports technology startups throughout their journey from early ideation to market launch, providing programs such as training, incubation, mentorship, funding support, and innovation labs.
In parallel, it operates the National Technology Development Program (NTDP), which offers additional funding, incentives, research programs, and partnerships all aimed at accelerating innovation and technology development across the kingdom.
Regulation supporting tech startups
Regulatory reforms are also playing a critical role in driving the growth of the Saudi tech startup ecosystem. These initiatives include establishing sector-focused regulatory sandboxes covering fintech, telecom, digital services, and emerging technologies. These regimes aim to de-risk innovation and accelerate technology commercialization, enabling startups to test and scale solutions in live market settings, and enhance investability.
Another key initiative is the Entrepreneur Residency, one of the Premium Residency products. The program targets entrepreneurs of tech companies who aspire to grow their startups in Saudi Arabia, allowing these entrepreneurs to live in the country without a local sponsor and run their own business. Other benefits include the ability to sponsor family members, travel freedom in and out of the country, and own property and invest in Saudi Arabia.
These efforts have allowed Saudi Arabia to rise in the global startup rankings. According to the Global Startup Ecosystem Report 2025 by Startup Genome and the Global Entrepreneurship Network, Riyadh jumped 60 places to rank 23rd among the world’s top 100 emerging startup ecosystems, reflecting the kingdom’s aggressive push to diversify its economy and its rapidly expanding startup ecosystem.
Featured image: Edited by Fintech News UAE, based on image by sebdeck via Freepik
