Over the past decade, the Public Investment Fund (PIF) of Saudi Arabia has made significant investments in some of Silicon Valley’s most prominent projects. These investments include stakes in companies such as Uber, Lucid, and Magic Leap, among others. Now, the PIF is reportedly gearing up for a $40 billion dive into the world of artificial intelligence (AI) with investments in French AI company Mistral, Databricks, and several smaller AI startups.
Mistral recently raised $640 million at a valuation of $6 billion, while Databricks raised $500 million at a valuation of $43 billion. Overall, investors have poured over $70 billion into AI startups in the year, according to Pitchbook. Sanabil, a subsidiary of PIF, was revealed to be a significant investor in Mistral’s Series B round, alongside other global investors from the US, EU, and Asia. Sanabil’s involvement in Databricks’ recent funding round was also disclosed.
In addition to AI investments, Sanabil has updated its portfolio to include investments in Chinese fast fashion company Shein, as well as education startup Classera and health tracking ring Oura. The fund has also invested in various venture capital firms, including Altimeter Capital Management, New Enterprise Associates, and Innovation Endeavor. Sanabil’s investments span across the globe, including backing VCs in China and Sweden.
Notable investments by Sanabil include stakes in former Sequoia partner Neil Shen’s Hongshan Capital, Chinese funds 5Y Capital and Yunqi Partners, and Sweden’s Northzone. The fund has also invested in renowned VCs such as Andreessen Horowitz, Coatue, and Founders Fund. NEA, one of the largest VC funds in the world with assets exceeding $23 billion, is another direct shareholder of Sanabil. NEA recently sold a stake in its management company to Dyal Capital Partners and Kuwait’s Wafra.
The PIF, known for its investments in SoftBank’s Vision Fund and the development of Neom, a futuristic city project, has now expanded its focus to emerging venture investors and tech incubators. Despite its past reputation for lack of transparency, the PIF has begun disclosing its investments and financial performance starting in 2022. VCs named on the Sanabil website did not respond to a request for comment from Forbes.
Despite concerns about Saudi Arabia’s human rights record and the killing of journalist Jamal Khashoggi in 2018, some VCs have publicly embraced the kingdom in recent years. The PIF’s efforts to diversify Saudi Arabia’s economy away from oil production have been supported by its massive assets, which are close to $1 trillion. PIF governor Yasir al-Rumayyan announced plans to increase spending to $70 billion annually from current levels of $40 to $50 billion, despite challenges posed by lower oil prices and national deficits.
