A Silicon Valley venture capital (VC) firm has secured a US$4 million investment from Mohammed Hasan Al Naqool Sons Company, a public-listed Saudi firm in the business of manufacturing building materials. VINEETA TAN has the story.
The VC firm, Graphene Ventures, has an investment portfolio which includes familiar tech names such as social media giant Snap and ride-hailing service Lyft.
The investment from the Saudi firm will be channeled into an eight-year Shariah compliant fund focusing on early-stage tech companies, particularly construction technology start-ups.
“The fund will target start-ups that promise significant technological innovation, whether it is a transformative force in traditional industries or meets the new demands and needs of the digital economy,” a bourse filing read.
Profits are distributed as they are realized, with the company reserving the right to reinvest earnings.
This is neither Graphene’s first foray into the construction technology sector nor the Middle East. In 2018, it invested into UAE-based WakeCap, a provider of enterprise solutions to improve the safety and productivity at construction sites.
Al Naqool, established in 1984, has been on an expansion drive. It listed on Saudi Arabia’s parallel market Nomu earlier in June as a means to support its borrowing plans to support its growth strategy.
“The agreement will support the future plans of Al Naqool Company in terms of achieving a positive impact on the return on capital investments, as it provides opportunities for future partnerships with promising companies in the field of construction technology,” the firm said.
Conventional private equity and VC players are increasing in prominence within the Islamic finance space. This seems to ring particularly true in the tech space as expounded by FairFinance Director Dr Vladimir Malenko, who is also an IFN Correspondent, in his August report.