Mohammed Bin Salman's AI Ambitions Get A Boost As Saudi Aramco's Venture Arm Invests $15M In South Korean AI Chipmaker

In a bid to bolster the artificial intelligence industry in Saudi Arabia, Saudi Aramco’s venture arm, Wa’ed Ventures, has invested $15 million in South Korean AI chipmaker Rebellions Inc.

What Happened: Rebellions is collaborating with Samsung Electronics Co. to develop its proprietary AI chips. The startup recently announced its intention to merge with Sapeon Korea Inc., a subsidiary of SK Telecom Co., and is considering an initial public offering in South Korea, reported Bloomberg.

Wa’ed Ventures, with a $500 million investment fund, is a key player in the Saudi Arabian tech investment scene. This investment in Rebellions is the second in the AI industry in less than a week, following a $6.5 million funding round for California-based AI platform aiXplain.

Fahad Alidi, managing director at Wa’ed Ventures, sees these investments as a strategic move to advance Saudi Arabia’s position in the global technology and innovation race.

Rebellions plans to use the funding to establish a new subsidiary in Saudi Arabia and commence business operations there.

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Why It Matters: The investment in Rebellions is a part of Saudi Arabia's broader strategy to diversify its economy away from oil. Recently, Saudi Aramco announced an $11.2 billion stock sale to fuel Crown Prince Mohammed bin Salman's economic transformation plans for the Kingdom. This stock sale, the largest global offering in three years, aims to fund various initiatives under the Vision 2030 plan.

Moreover, the investment in AI technology aligns with Saudi Arabia's increasing need for data centers and semiconductors. As noted by Lumida Wealth co-founder Ram Ahluwalia, "Semiconductors are the New Oil," highlighting the Kingdom's strategic pivot towards technology.

Additionally, the U.S. government has recently slowed down the issuance of licenses for the export of AI chips to the Middle East, citing national security concerns. This move could have significant implications for the global tech industry and underscores the importance of Saudi Arabia developing its own AI capabilities.

Despite earlier reports suggesting a potential scaling back of the ambitious $1.5 trillion NEOM project, Saudi Arabia has confirmed that the NEOM megaprojects will proceed as initially planned. This is part of the broader Vision 2030 initiative to diversify the Saudi economy away from oil.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote