Of late, family offices in the GCC have been redefining their investment strategies, adding innovation-driven sectors like health-tech and AI within a VC approach, in addition to traditional asset classes.
This addition reflects wider economic diversification goals, particularly in line with national visions such as Saudi Vision 2030 and Dubai 2040. Gulf investors are honing their attention and their capital toward sectors that promise growth rather than merely wealth preservation.
In Saudi Arabia, private investment is rising sharply in health-tech and biotech ventures, building on large public initiatives and deep research in institutions such as the National Institute for Health and the King Abdullah University of Science and Technology.
“At the same time Saudi Arabia remains heavily reliant on imports in the med-tech sectors with a strong governmental push for localization. That presents a real opportunity for innovation and returns,” Paula Tavangar, chief investment officer at Injaz Capital, shared with IFN Investor.
Saudi Arabia has become the center for venture capital in the region, due to its larger population size, access to capital and deep governmental support. Deal sizes are usually larger with slightly higher valuations compared to the EU and the US, Paula noted.
“The UAE, in contrast, retains an edge in openness and internationalism with a more diverse start-up landscape. Egypt, meanwhile, is emerging as a satellite market, cheaper, but culturally and linguistically aligned with the Gulf, which creates the perfect opportunity for Egyptian start-ups to expand in the region.”
Furthermore, family offices and high-net-worth individuals are eyeing early-stage investments with new seriousness, having been inspired by the breakout success of Careem, a ride-hailing firm acquired by Uber in 2020. It encourages them to realize that they can generate alpha outside the public markets, Paula said.
“Careem proved that Western business models can thrive here. And that success has catalyzed, to a certain extent, the local start-up ecosystem.”
Similarly, other local examples include Tabby and Tamara, two homegrown Buy Now Pay Later (BNPL) firms. Both have managed to localize a model pioneered in the West, tweaking it to local demand and extending it beyond consumer finance into B2B credit successfully.
For investors, such adaptations signal maturity in the regional start-up ecosystem and a chance to get in early on scalable businesses, explained Paula.
In Saudi Arabia, consumer and investor demand for Shariah compliant products remain high. With this in mind, BNPL firms and others must carefully structure their offerings to meet these requirements.
Legal firms are often involved behind the scenes to ensure compliance. “It’s not something that’s marketed, but it matters deeply to all stakeholders,” noted Paula.
The appetite for risk is not purely generational, though younger family members are often driving change. Many large family holdings are seeking strategic synergies, hoping to acquire or back start-ups that can integrate with legacy businesses.
In sectors like healthcare, fintech and advanced manufacturing, such alignment is easier to find and sometimes subsidized. Paula observed that Saudi Arabia, for instance, offers zero-interest loans, rent-free industrial spaces and even salary support for start-ups deemed strategically valuable.
“Fixed income is not going away. Interest rate hikes have revived its appeal, particularly for more conservative investors. But the asset allocation mix is changing. Across the region, a shift is underway from wealth preservation to wealth creation.
“In a region historically defined by oil wealth, the families are actively diversifying and placing bets on the next wave of economic transformation.”
