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In a promising new development for the entrepreneurial ecosystem in Saudi Arabia, the largest sovereign fund in the world has announced it will be offering a helping hand to the kingdom’s startups and SME sector.

The Public Investment Fund (PIF) of Saudi Arabia, which is estimated to possess around $320 billion, confirmed earlier last week that it is creating a new fund called Jada for making investments in the country’s up-and-coming businesses. At over $1 billion, the size of the new fund is also pretty hefty. 

Rather than directly investing in startups and SMEs, Jada will primarily invest in venture capital and private equity funds. Although, it refrained from elaborating any further.

“Jada supports Saudi’s diversification efforts as the private sector increases its share of GDP. With a capital of SAR 4 billion, the company will catalyze SME investment and provide new job opportunities,” read a statement by Jada following the launch announcement.

Meanwhile, Raed Venture and Vision Ventures are expected to become among the first VC firms to draw investments from Jada.