Saudi Arabia Establishes $40 Billion Fund for Investing in AI Start-ups
Saudi Arabia is currently in discussions to create a massive $40 billion fund dedicated to investing in artificial intelligence. This move reflects the kingdom’s ambition to enter the thriving industry, which is already well-funded, and to solidify its position in high-tech sectors.
Reports suggest that Saudi Arabia’s Public Investment Fund (PIF), boasting an estimated $925 billion in assets, is currently engaged in discussions with the Silicon Valley venture capital firm Andreessen Horowitz regarding a potential collaboration.
According to The New York Times, the fund is projected to be set up by the end of 2024. The substantial amount of $40 billion would surpass the current robust investments in the market.
The $40 billion money pot could see investments in artificial intelligence, microchip manufacturing, and high-tech data storage. It could also lead to Andreessen Horowitz opening an office in Riyadh and the kingdom establishing its own AI start-ups.
Andreessen Horowitz’s co-founder, Ben Horowitz, is reportedly good friends with PIF governor Yasir al-Rumayyan. He recently hosted the Saudi official during a visit to the US for the Super Bowl and a tour of his adopted city, Las Vegas, the NYT reported
The two are now in talks about establishing the AI investment empire, the daily said, which would make the Saudi government and Andreessen Horowitz leaders in the booming AI market.
AI has become the hottest topic in the tech world and is destined to transform almost every industry and aspect of everyday life, according to experts.
There have been huge moral dilemmas about the AI revolution brought up by experts in the field such as British-Syrian tech entrepreneur Mustafa Suleyman including abuse by oppressive regimes and potential mass job losses through industry innovations.
Saudi Arabia has sought to position itself as a regional leader in high-tech industries under Crown Prince Mohammed bin Salman, as it seeks to diversify its economy away from oil.
NEOM is a huge planned megacity project that will include a 170km linear city known as The Line, free of streets and cars.
Many have questioned the feasibility of this never-seen-before city, but its success will hinge on huge growth in the kingdom’s high-tech industry and massive domestic and external investments.
Marc Andreessen, Co-Founder and General Partner of Andreessen Horowitz, was also on the advisory board for NEOM.
Saudi Arabia has also tried to coax regional investors to set up their headquarters in Riyadh with high-tech infrastructure a key part of this strategy.
Yet AI is a hugely expensive industry with OpenAI seeking $7 trillion in investments, including from the UAE, to boost chip-building capacities.
The PIF is also looking to expand its investment empire, with purchases of football clubs such as Newcastle United and plans to take over national carrier Saudia.
