Web3 in Saudi Arabia: A Vision-Driven Movement

Speaker A: Thank you for joining us today here at Future Spark demo day in Riyadh. This is the culmination of Outlier Ventures first ever Web3 cohort in Saudi Arabia, which also happens to be first ever Web3, uh, cohort in Saudi Arabia. Uh, it's also the first achievement with our local partners, NTDP in neom. My name is Vendar Altunisi, local director for Outlier Ventures, as well as a Web3 founder myself. We just wanted to take some time today to meet some of our founders as part of Future Spark demo day, as well as our coo, Stefan Appel.

Speaker B: Hello, Stefan.

Speaker A: Hello. And also we welcome, uh, two of our founders from Future Spark here in Riyadh. We have Rami from Sorbet and Mateusz from osla. So, Matesh, how does it feel?

Speaker C: It feels pretty awesome. I mean, it's been a busy few months, uh, here in Riyadh and in Neom, and it's finally amazing to be here and present all the things that we've developed and all the changes that we've implemented over the last few months. So thanks for having us here, guys.

Speaker A: Rami, how does it feel?

Speaker D: Yeah, it feels great. I'm super happy to be part of this inaugural cohort in Riyadh. Um, a couple of years back, I would have never imagined outside adventures coming to the region. So very happy to be part of it and to show our products very soon.

Speaker A: Absolutely. No, it's very, very exciting. And I think, um, Stefan, you've been to a lot of demo days. You've seen this before. Uh, but this is really a special place for, uh, Outlier Ventures. First time in Saudi Arabia, kind of venturing far away from home. How does it feel? What makes this special for ovi?

Speaker B: Well, indeed, Banda. For us, this demo day is very, very special. Um, Saudi Arabia was our second office that we opened after our offices in London, our headquarter. Um, we now have employed a whole team here on the ground and, um, then recruited this first cohort. And, um, it's great to see where all the founders have gotten to. There's nine founders now graduating this program. Uh, nine founding teams. We only have two, uh, here right now. But, uh, it's extremely impressive. I met, um, you know, we signed the MOU with NTDP at Leap last year, approximately almost 12 months ago. Uh, and to see now during this whole period how the team has planned this program, we've recruited the founders. I'll later come to this a bit more. But we had hundreds of applications, um, for this program and now we've run this first cohort. We've learned a lot while doing this. I'll also come back to that a bit later. Um, it's amazing to now be here and to be able to present what these founders have achieved, what these founders have learned, where they've gotten to. Also in discussions with our partners, NTDP and neom. Um, we all so excited for this and I can't wait to later see them all on stage.

Speaker A: Exciting, exciting stuff. And I think, you know, I think you, you see the vision here, right? You understand the excitement that is in this country. Uh, and you obviously want this to be a very successful platform for the Web3 industry. Has there, has there been anything on the ground here that has surprised you compared to your experience anywhere else?

Speaker B: The commitment, I would say the commitment. It started from ntdp, you know, the meetings with Ibrahim Najas, who will also later speak, the CEO of ntdp and then also neom. Um, you know they, the understanding that the leadership of these organizations have about Web3 already and following the vision 2030, the understanding of uh, the leaders, uh, that how Web3 can contribute to achieving uh, that vision and how Web3 can contribute to diversifying the economy, to attracting founders globally, to attracting capital uh, from abroad to come into Saudi. And that's why it's important to have these startups develop their technologies here, implement them with local uh, partners, you know, whether it's public or private sector. Try PoCs, proof of concepts, uh, for some of those aspects that they've developed and then, and then you know, raise funding from uh, capital from venture capitalists, either local VC firms. And we've received a lot of interest uh, for this demo day. A lot of people signed up are going to come shortly, um, as well as international VCs always looking at our demo days. Typically we have around 400 uh, VCs dialing into our virtual demo days because most of our other programs are run virtually. This is the first program again since COVID or since the beginning of COVID early 2020 where we are running a cohort fully on the ground and we are so happy that this has now worked uh, out so well. I've seen the founders pitch already a little bit before I ah, have to admit. Uh, and uh, we are really really proud. We are proud of the founders and all the hard work they've put in and I'm really, really glad how this cohort uh, exemplified by the founders is bringing together the Web3 ecosystem and this really really strong interest uh, that is already here about Web3 and brings this together to accelerate this ecosystem which is just really getting started, coming together and uh, that's so nice to see.

Speaker A: Absolutely. Really exciting stuff. Totally agree. It's an innovation that's going to help everything, all sectors across the board. And so why don't we hear a little bit from our founders. So you've been doing this uh, for a while now, you've been practicing your pitch. So I'm going to ask you now give me your elevator pitch, uh, as a kind of training and practice, uh, for, for the, for the demo day. So Rami, why don't we start with you? Give us your elevator pitch.

Speaker D: Yeah, it would be my pleasure. So essentially I'm um, the co founder at Sorbet and at Sorbet, so I've in the past I've been a freelancer and I also hired freelancers and there was always one problem that often came out, especially when it comes to freelancers in emerging markets was their inability to collect payments. Right. And that's due to the fact that a lot of countries or jurisdictions, they work on different payment rails. So you have like ach, that is more US sipa, uh, that's more European based and you have a bit of Swift, um, in some of the emerging markets. And it happened to me where I needed to pay for a service in Saudi with my Canadian bank account and I wasn't able to pay like a service so it was very annoying just figuring out how I was able to pay that service. So that kind of led us to build Solbet and to really help freelancers in collecting payments and also managing their business. Essentially that's what we do is simplify payment collections, uh, for freelancers globally and we also help them manage their income and their business.

Speaker A: That's amazing. I think it speaks a lot to the cross border nature of this industry. So thanks for that. Uh, Mateusz, what about you?

Speaker C: We're a bit simpler. The Wasla, uh, we shut down electricity for a living. So, so we realized that with all that growth that Stefan has mentioned, there is a lot of demand for electricity coming to the grid and grid is going to experience a certain set of issues. And we decided to enable all the households in a fair and transparent way to contribute to ensuring that the grid can remain stable. So what we do is we integrate different household devices, we connect them, we aggregate them, we use the data to manage the grid more efficiently and focus on the demand side management and integrate it into smart city concept, cognitive city concept I should say. Uh, as we've Seen in neom. Um, so pretty excited to be building here in Saudi.

Speaker A: Yeah, that's super exciting. I mean energy efficiency is the, uh, you know, the talk of this decade. Right. And I think Web3 has a huge part, uh, to play in that as well. So maybe continue with you Matesh. How is your experience at Futurespark? What can you tell us about it?

Speaker C: I think it's a very interesting experience, a very unique one. And I think that, you know, there is many accelerators out there. But I think what really allowed us to understand that Future Spark and Outlier Ventures is the right partner for us was the big commitment to the region while also having a very much big understanding of Web3 sector and bringing that knowledge from outside to the kingdom. When I've met Stefan here, uh, I think one and a half years ago, which is very rare to see people coming and having so much commitment to the region, coming and being on the ground. So I think that the part where we see partners on the ground, we see the team on the ground is very valuable for us. Also having this cohort here in person rather than virtually has helped us a lot to meet other founders and to better understand how to build this ecosystem together, like with founders like Rami.

Speaker A: Absolutely. That's great. Ah, and then Rami, what about you? So obviously accelerators are, they come often, they come a lot. So what made Future, uh, Spark and Outlier Ventures particularly interesting for you?

Speaker D: Yeah, so yeah, before starting Outlier Ventures, we were also contacted by another accelerator. We were accepted into another accelerator in the region. So we kind of did our due diligence. I had previous friends of mine that have done OV in the past and also friends who have done this other accelerator. And when I was speaking to these founders that have done these two accelerators, the founders from OV had very positive reviews about it. Told us that if you're building in web 3, ov is the go to partner. And we didn't think twice about going with OV because as a Web3 company there's a lot of different areas that are not similar to like Web2 companies. So like when it comes to like tokenomics, regulatory aspects, um, even like product or go to market or marketing strategies, they're completely different, um, in Web three. So yeah, working with um, OV and being part of this accelerator really helped us kind of polish, um, our product offerings for sure.

Speaker A: Absolutely. That's so exciting. I think you spoke about bringing in capital, bringing in people into Saudi Arabia. How did you see the application process when it comes to this Specific cohort, particularly when it comes to local versus international people. Did anyone come in for this? Tell us more. A little bit at the application part.

Speaker B: It was a very interesting process because we also did not exactly know what to expect when we launched this. So from March or April onwards, uh, 2024 last year we started taking applications, try to provide more content and more education to the wider Web3 sector about what Saudi Arabia has to offer. Uh, a lot of the listeners here might have seen some of those LinkedIn content pieces that just highlight how strong that commitment is. Not many people, and in particular not web 3 founders know yet how committed uh, the country and its institutions are to uh, Web three and attracting international founders and supporting them, helping them, implementing some of their technologies. And so in the end then, but then applications started coming in from all over the place and that was a combination of uh, founders, uh, also from Riyadh that have been previously based here already. And we have two of those uh, here with us on the podcast, uh, Rami and Mateusz, um, but also founder. Then the next aspect was more founders from the wider MENA region that were previously based or either in Dubai or Qatar or Turkey, uh, Egypt that they were interested in this and coming in. This is why Saudi and Riyadh in particular can act as a magnet for the region to attract those uh, motivated and high skilled and flexible founders to, to relocate here also. But then you know, not surprisingly in fact we have had applications from all over the world and in this cohort you, you will see this, you know, a founder from New York that, that applied and relocated here for this program. There are founders from, you know, from various other countries. Um, and, and that's, that, that's very nice. Now maybe looking at, at sectors in particular, I think for Web3 founders the Kingdom is so interesting because it has use cases across the entire spectrum of what Web3 covers. Ah, every single industry vertical is more or less represented here. Uh, there's a lot strong focus on certain industries in particular that are very closely related to Web3. Even more, for example, when I look at smart cities, I look at uh, energy efficiencies, I look at uh, gaming and entertainment. Uh, you know those sectors are very uh, prominently represented in the economy here. Currently already in the traditional form before Web three. Um, and also will be in the future. And with what we've learned about uh, you know, the different projects that are planned here and the different developments, you know, this is, it's a great ground for founders to come to be based here to explore the ecosystem and everybody is very welcome, being very welcome here with open arms. The doors are opening. Uh, and I've really perceived a very, very friendly environment for Web3 founders to come demonstrate their technology and implement the solutions.

Speaker A: Absolutely, absolutely. I think ov doing this for 10 plus years is in a very unique position to offer this. Um, so Matthias, we talk about proof of value, what you, you know, what you actually got out of this experience. So tell us a little bit about who, what, something that gave you a lasting impression during your experience with uh, Future Spark.

Speaker C: I think when we, when we came in to Futurespark, we're looking at a B2B context and you know, spending time with that incentivization team with Matthew, spending the team with Nai from neom, really helped us understand that we need to stimulate the demand and we shift it to B2C. Uh, we're seeing a lot of progress on the team side, we're seeing a lot of progress on the product development side. And it's been exciting to be challenged really sort of on a day to day basis by the team, which now allowed us to be sort of a week away from launching a first Software on the B2C side which, uh, will be super exciting going forward here in Saudi.

Speaker A: Yeah, that's awesome. Pivots are necessary and the earlier the better. Right. To finding your product market fit for sure. Um, so Rami, going to demo day now. Looking back, looking forward, what are some of your highlights and then what are you looking forward to?

Speaker D: Yeah, no, um, so the past three months were really three months of accelerated learning, um, and also a lot of relationship building. So in terms of accelerated learning, working with all the different SMEs, um, when it comes to marketing, again, legal, um, or tokenomics really helped us polish the product. And then when it comes to relationship building, building in Saudi, building a Web3 company in Saudi, it's still a bit niche, we're still a bit early. So there's not so many companies with whom you can kind of exchange ideas or like do some sort of like knowledge transfer. Because in the past I had the opportunity to live in like Montreal, um, Indonesia and in lisbon, where these Web3 communities are kind of really big, you know, and flourishing and you have, you get a lot of value just speaking with other founders. And that's one of the big value adds that we had from the OV program. Was also talking with other founders, as Matthias mentioned. Um, and yeah, I guess, yeah, the future is bright. Having a couple of founders come in Riyadh also building From Riyadh is going to be very exciting moving forward.

Speaker A: Awesome, awesome. Yeah, it's always good to be around fellow founders. Definitely helps. Um, so looking forward, Stefan, uh, obviously you had a uh, big conviction about Saudi Arabia. Uh, this is only the beginning of your journey in Saudi Arabia. What else can we look forward to with OV in Saudi?

Speaker B: Well, uh, this was just the first cohort.

Speaker D: Right?

Speaker B: This was the very first cohort. We have a partnership with uh, both NTTP and NEOM to keep running cohorts. The plan currently is two cohorts every year. Ah, the size of these cohorts is a bit flexible so it could become even bigger. It could accelerate more founders of what we are doing here. And uh, it's great to see how the ecosystem and different corporates, different investors, how all of those are really coming together. We are delivering the purpose of this uh, accelerator product to get the ecosystem going, to accelerate this. And we have very, very high ambitions uh, for this region and the Kingdom in particular. Uh, we would love to do a lot more here. And uh, we have with our 10 years history, our 80 professionals in the firm world, leading professionals and uh, our wider portfolio of almost now 400 projects in this space. We have so many learnings, uh, that we've gathered over the years and so much expertise in house, um, that we would uh, love to. And we will be bringing this to the kingdom, contributing via knowledge transfer, via attraction of founders and capital to come to the Kingdom, uh, and help contribute to the achieving vision 2030.

Speaker A: Absolutely, absolutely. I think the future is bright with Future Spark for sure. So clearly the future is quite bright for Future Spark. We've heard from the founders about some of the lessons they've learned. What are some of the lessons learned from OV here in Saudi Arabia?

Speaker B: Yeah, so the key lesson for me was initially just arriving here on the ground in Riyadh, not having been here before, uh, how welcoming everybody is and also the, how wide reaching, uh, already the understanding of web3 is uh, in particular also among the leadership of the various institutions, not just the founders working on some projects. And There are various web3 projects already on the ground in Riyadh. It's not that there is no ecosystem, it's already there. A lot of people are active in this space, um, and uh, the leadership of those institutions and for example NTDP and NEOM, they see, they understand that web3 is uh, a key contributor to making their vision come to life. If you want to realize a cognitive city, if you want to run AI models and AI systems Where uh, the data is owned by the user and the user makes uh, their data and their consents available and has sovereignty, um, over their dealings. That this is only possible both cognitive cities and AI models via Web3. Web3 rails and decentralized models are uh, the key infrastructure here that's going to help achieve these massive plans.

Speaker A: Yeah, absolutely. I think the AI narrative is something the whole world is excited about and particularly people in the Web3 community really excited about that because of the opportunities that Web3 will allow for AI from a computer, from a data, from whatever kind uh, of perspective. Now obviously the big talk of the town for OV these days is this Post Web thesis. So why don't you tell us a little bit more about this post web thesis and potentially its effect on the MENA region.

Speaker B: Yes, so we've always been very, uh, driven by thought leadership. In 2016 already we were releasing research reports about the convergence of AI and blockchain technology. Um, we've always been at the forefront of this, but we don't uh, you know, we don't just write about it and talk about it. We actually put our money where our mouth is. We've now invested in close to uh, 400 projects that we have accelerated over the last uh, uh, ten years. Um, and now we are having, we just released another, another research piece, you know, our vision for how we are seeing the Internet develop over the next five to 10 years. And we call it the Post Web. And in fact, uh, it's an observation on the back of many, many hours of conversations, uh, with our portfolio founders and other shapers, influencers and founders in this space about how this whole space is emerging jointly and together. And we've already seen that a lot of conversational AI models are creating or thinning the layer of the Internet, the interface with the Internet. People nowadays do not have to go Google search anymore, type in what they are looking for. They speak to their conversational AI, they receive answers. Uh, and so in our prediction, this might even be the end of search engines as we know it. And in fact it might also be potentially the end of apps, uh, as we know it. Because what we are seeing going forward is an agentic network where um, people have their own AI agents that on their behalf will execute transactions and they will not just execute transactions with other people, they will also execute transactions and optimize processes and transactions and look for the optimal outcome across the Internet infrastructure. Um, uh, and then they'll also deal among each other, these agents. And so for, in order to make this a reality, Web3 is a critical infrastructure here that is needed.

Speaker D: Um,

Speaker B: whether it's identification of who that agent is and who it belongs to, whether it's about uh, owning the, controlling the economic results of those outcomes, owning the data uh, that comes out of these transactions and then is related to that, um, the access to compute to make that happen, the different rails of where these transactions happening, the marketplaces, um, Web3 is ideal for this. And only with Web3 this can really scale and be adopted and be trusted in particular. And then as a result what we see, how this new stack or this envisaged stack of the Internet is shaping up, what we're seeing is that this might potentially even lead to a uh, fundamental shift in how corporates and how organizations and how uh, um, various entities and institutions are interacting with their users, their end clients. We see this uh, shift moving away from this very strong attention economy that we've all heard about and talked about the last 10, 15 years about how you need to educate and show and attract. And this is a huge aspect uh, in the marketing and advertising space. Obviously this attention economy, how this is shifting away to the user centered, uh, uh, intention, uh economy where people with their intent can communicate this, can signal their intent uh, via their spoken AI or other routes, uh, and then their agents online can go execute and make that future happen that the user intends. Uh, it can organize rides, it can order food, it can uh, make resources available, get access to certain things. Uh, the whole web is going to change um, to this intention economy. And what we will hear later, in fact at our demo day here later, we will hear from our founder and chairman, Jamie Burke. Uh, he will summarize uh, this big thesis and this big move for the audience as well. And we are very proud of this. We are very happy that also we have this North Star. Uh, this allows founders from across the globe also to see what we stand for, how we see the future and then see whether they identify with this as well or not. Uh, and then any founder that is applying to any of our programs, and we are going to start recruiting for the second program here in Riyadh very soon. Um, any founders that are applying for this, you know, they know they are welcome here. They have a partner that understands also what these founders ah, very often want to achieve where previously, you know, other participants in the industry might not have, um, understood, ah, this. So we are very happy and have big plans and we are great to you know, also to work with our partners here in the kingdom.

Speaker A: Yeah, that's honestly, really exciting. Uh, I think everyone agrees that this is, you know, the right path, the right North Star to go towards. Um, I wanted to thank you, uh, all three of you, for joining today. I know the founders are eager to get back to sharpening their pitches, so thank you, Stefan. Thank you, Rami. Thank you, Matthias, and thank you, everyone, for tuning in.