In a significant move to deepen the Kingdom’s private capital markets, Jada Fund of Funds, a subsidiary of the Public Investment Fund (PIF), has announced a strategic partnership with India-based venture debt firm Stride Ventures. The collaboration is set to inject USD 200 million into Saudi Arabia’s burgeoning startup and SME ecosystem over the next two years.
This initiative aims to expand access to non-bank financing for local companies, a crucial component of the nation’s economic diversification goals. The partnership underscores a growing appetite for alternative lending in the Gulf, signaling strong confidence in the region’s long-term market potential.
Bolstering the Kingdom’s Private Capital Market
Jada was established in 2018 with approximately USD 1 billion in capital from the PIF, mandated to build a thriving private capital ecosystem in Saudi Arabia. By investing in venture capital, private equity, and now increasingly private credit, Jada plays a pivotal role in supporting the growth of small and medium-sized enterprises.
To date, the fund of funds has deployed nearly USD 600 million across roughly 50 different funds. This new partnership with Stride Ventures marks a targeted effort to address the financing gaps that SMEs often face with traditional bank lending, providing them with more flexible and accessible funding options.
A Contrasting Global Landscape
The push into private credit comes at a time when the asset class is facing heightened scrutiny in mature markets like the United States. Investors are increasingly questioning valuations and underwriting standards, creating a cautious atmosphere.
However, the sentiment in the Gulf is markedly different. Regional executives view the Middle East’s private credit market as nascent and underpenetrated, presenting a significant growth opportunity rather than systemic risk. This early-stage dynamic allows for development and expansion, defining the current phase of the market’s evolution.
A Regional Trend Towards Alternative Lending
Jada’s strategy is part of a broader regional trend among sovereign wealth funds to increase their exposure to private credit. This move aligns with similar initiatives across the GCC.
The Qatar Investment Authority (QIA) is notably backing a new private credit firm launched by former Goldman Sachs partners. Similarly, the UAE’s Mubadala Investment Co. has also been actively building significant exposure to the asset class, highlighting a collective belief in the strategic importance of alternative lending for economic development.
About Jada Fund of Funds
Jada Fund of Funds is a wholly-owned subsidiary of the Public Investment Fund (PIF) of Saudi Arabia. Launched in 2018, its mission is to catalyze the growth of the private capital ecosystem within the Kingdom. Jada invests in venture capital, private equity, and private credit funds to support the development and diversification of the Saudi economy by providing essential funding to small and medium-sized enterprises.
Source: Waya
