Riyadh, Saudi Arabia – Shorooq, a prominent investment firm with $500 million in assets under management, has set its sights on becoming the “Blackstone of the Middle East.” With a vision to bridge critical gaps for private investors and fuel economic growth, Shorooq sees Saudi Arabia as a cornerstone of this mission. Founding partner Mahmoud Adi emphasized the strategic significance of the Kingdom’s robust consumer confidence and economic potential, which have created fertile ground for new companies to develop and scale their offerings.
“We believe a well-run Shorooq can unlock more value for everyone in the ecosystem,” Adi shared, during the Future Investment Initiative conference in Riyadh. Adi highlighted that Shorooq enables early-stage companies to access sovereign wealth funds (SWFs) through its ecosystem—a unique advantage for startups in the region. Investors in Shorooq’s funds include notable SWF-backed entities like Abu Dhabi-based Lunate, Mubadala, and Saudi PIF-backed Jada Fund of Funds.
In line with its goal of supporting early-stage companies from seed funding through to IPO, Shorooq’s portfolio includes Saudi-based buy-now-pay-later (BNPL) leader Tamara, UAE’s innovative vertical farming venture Pure Harvest, and other high-potential companies such as investment app Sarwa, peer-to-peer lender Lendo, and digital freight platform Trukker. Its most recent investment saw Shorooq lead a $15 million round into UAE-based fintech Abhi, a lending platform allowing blue-collar workers early access to wages.
Shorooq also recently launched a $100 million private credit fund, responding to a market gap for scalable, non-dilutive funding options. Companies like Tamara and Pure Harvest have been among the early recipients of this credit. “Credit is one of the most scalable asset classes, which is extremely crucial to unlock value in economies,” Adi noted, adding that Shorooq aims to empower growth-stage companies in the region struggling to access alternative capital sources.
Saudi Arabia’s active IPO market, with six out of seven GCC IPOs in Q3 2024, also adds to Shorooq’s appeal as a regional investment powerhouse. According to Adi, the opportunity for early investors to capitalize on IPOs without pressuring companies prematurely aligns with Shorooq’s commitment to sustainable growth. Tamara, one of the BNPL space’s strongest players alongside rival Tabby, has yet to announce IPO plans. While Tabby eyes a 2025 IPO, Adi stressed that the decision to go public depends on the company’s readiness and strategy, warning against rushed IPOs that could jeopardize long-term success.
As Shorooq solidifies its position, it remains committed to developing the Middle East’s private investment ecosystem, prioritizing strategic growth over short-term gains. “An IPO offers a permanent capital structure and gives investors an opportunity to recirculate their investment. However, it’s crucial that companies don’t rush this process,” Adi emphasized.
Shorooq’s ambition to emulate Blackstone in the Middle East marks a pivotal movement within the region’s financial landscape, positioning the firm as a transformative force for economies and businesses alike.
Source: ZAWYA
Credit to: (Reporting by Imogen Lillywhite; editing by Bindu Rai)
