Saudi Startup Exit Landscape: IPO Exits, M&A, Secondary Sales, Tadawul and Nomu Listings

Saudi Startup Exit Landscape: How VC-Backed Companies Generate Returns

The exit landscape — the pathways through which venture-backed companies generate returns for their investors — is the ultimate test of any startup ecosystem’s maturity and sustainability. Saudi Arabia’s exit infrastructure has developed significantly since 2020, with the Nomu parallel market providing a viable IPO pathway, cross-border M&A activity increasing, and secondary market transactions becoming more frequent. However, the exit landscape remains one of the Saudi VC ecosystem’s most significant development areas, with the volume and scale of exits still lagging behind the volume and scale of capital deployment.

This page provides a comprehensive analysis of the Saudi startup exit landscape, covering the IPO pathway (on both the main Tadawul exchange and the Nomu parallel market), M&A dynamics, secondary sales, and the forward trajectory of exit infrastructure development.

The Exit Imperative

The importance of exits to the Saudi VC ecosystem cannot be overstated. Venture capital is a return-driven asset class — limited partners commit capital to VC funds with the expectation that invested capital will be returned with a meaningful premium over a defined time horizon (typically ten to twelve years for most fund structures). Without viable exit pathways, the venture capital model cannot function: funds cannot return capital to LPs, LPs lose confidence in the asset class, and the flow of new capital into the ecosystem declines.

Saudi Arabia’s VC ecosystem has attracted over $5 billion in cumulative investment since 2017, creating a large and growing portfolio of venture-backed companies that will need exit pathways over the next five to ten years. The adequacy of exit infrastructure to absorb this portfolio will be a critical determinant of the ecosystem’s long-term sustainability and of the Kingdom’s ability to attract continued institutional VC allocation.

IPO Exits: Tadawul and Nomu

Public market listings on the Saudi Exchange represent the most visible and potentially most lucrative exit pathway for Saudi venture-backed companies. The Saudi Exchange operates two listing platforms relevant to the startup ecosystem: the main market (Tadawul) and the parallel market (Nomu).

Tadawul Main Market. Tadawul is the primary equity market in Saudi Arabia, with a total market capitalization exceeding $2.8 trillion and a roster of listed companies spanning petrochemicals, banking, telecommunications, utilities, and other major sectors. The main market’s listing requirements — including minimum capital requirements, profitability history, and corporate governance standards — are designed for large, established companies and are generally too demanding for most venture-backed startups at their current stage of development.

However, the most mature and successful Saudi startups may eventually qualify for Tadawul main market listings as they achieve the scale, profitability, and governance standards required. A main market listing provides access to the deepest pool of domestic and foreign institutional capital, the highest trading liquidity, and the greatest visibility among investors and analysts. For the small number of Saudi startups that achieve the requisite scale, a Tadawul listing represents the optimal exit pathway.

Nomu Parallel Market. Nomu was established in 2017 specifically to provide a public listing venue for smaller and growth-stage companies that do not yet meet Tadawul’s main market listing requirements. Nomu’s listing requirements are less demanding than those of the main market — with lower minimum capital requirements, no profitability history requirement, and simplified disclosure obligations — making it accessible to venture-backed companies at earlier stages of maturity.

Nomu has emerged as the primary IPO exit pathway for Saudi startups, with several venture-backed companies completing listings since the market’s launch. The most notable startup listing on Nomu was Jahez, the food delivery platform, whose IPO generated significant returns for its venture investors and validated Nomu as a viable exit pathway for the Saudi startup ecosystem.

Nomu Listing Mechanics. The Nomu listing process involves several key steps: appointment of a nominated advisor (a CMA-licensed firm that guides the company through the listing process and provides ongoing market-making and advisory services), preparation of a prospectus meeting CMA disclosure requirements, completion of CMA review and approval, pricing and allocation of shares to qualified investors (Nomu trading is restricted to qualified investors, defined as institutional investors and high-net-worth individuals), and commencement of trading.

The listing process typically takes six to twelve months from initiation to trading commencement, depending on the complexity of the company’s structure and the CMA’s review timeline. Costs associated with a Nomu listing — including advisor fees, legal fees, audit fees, and CMA filing fees — are material but manageable for companies with sufficient revenue scale.

Nomu Trading Dynamics. Nomu trading dynamics differ significantly from those of the main market. Trading volume is lower, bid-ask spreads are wider, and price volatility is higher — reflecting the smaller investor base (qualified investors only) and the earlier-stage profile of listed companies. These dynamics create both opportunities (for investors willing to accept illiquidity in exchange for access to high-growth companies) and challenges (for companies seeking to use their listed stock as acquisition currency or for investors seeking to realize positions quickly).

Migration from Nomu to Tadawul. Companies listed on Nomu can migrate to the Tadawul main market once they meet the main market’s listing requirements. This migration pathway creates a growth trajectory for listed companies — listing on Nomu first to access public capital and establish market presence, then migrating to the main market as the company matures. Several Nomu-listed companies have completed or announced migrations to the main market, validating this growth pathway.

M&A Exits: Domestic and Cross-Border

Merger and acquisition activity involving Saudi startups has increased, providing an alternative exit pathway to public listings. M&A exits in the Saudi market include both domestic acquisitions (Saudi companies acquiring other Saudi companies) and cross-border transactions (international companies acquiring Saudi startups or Saudi companies acquiring international targets).

Domestic M&A. Domestic M&A activity involving Saudi startups has been driven by several factors: the consolidation of fragmented markets (larger companies acquiring smaller competitors to build market share), the strategic acquisition of technology capabilities (established Saudi companies acquiring startups to access innovative technology), and the expansion of platform businesses (marketplace and platform companies acquiring adjacent-service providers to expand their offerings).

The domestic M&A market is still developing — the number of transactions and the average transaction size remain modest compared to more established VC markets — but the trend is clearly upward. The growth of domestic M&A is facilitated by the increasing sophistication of Saudi corporate development teams, the availability of acquisition financing from Saudi banks, and the willingness of startup boards and investors to consider acquisition offers.

Cross-Border M&A. Cross-border M&A has produced some of the Saudi VC ecosystem’s largest exit events. The most prominent example remains the Uber acquisition of Careem in 2020, which generated over $3 billion in transaction value and provided significant returns for Careem’s venture investors (including STV). The Careem exit demonstrated that international strategic acquirers are willing to pay premium valuations for leading Saudi and MENA technology companies, establishing a benchmark that has influenced expectations across the ecosystem.

Subsequent cross-border M&A activity has included acquisitions by international technology companies, regional conglomerates, and private equity firms. The volume and scale of cross-border transactions are expected to increase as more Saudi startups achieve the scale and market position that attract international acquirer interest.

Valuation Dynamics in M&A. Valuation dynamics in Saudi startup M&A transactions are influenced by several factors: the strategic premium that acquirers are willing to pay for Saudi market access (particularly relevant for international acquirers seeking entry into the Kingdom’s large and growing market), the limited supply of acquisition targets at scale (the small number of mature startups means that acquirers face limited competition for targets, but also that targets may command premium valuations due to scarcity), and the competitive dynamics between acquirers (when multiple potential acquirers express interest, competitive tension can drive valuations higher).

Secondary Sales

Secondary market transactions — the sale of existing investor positions in private companies to other investors — have become an increasingly important liquidity mechanism in the Saudi VC market.

Types of Secondary Transactions. Saudi secondary transactions include direct secondaries (where an existing investor sells its position directly to a new investor), structured secondaries (where a secondary fund purchases a portfolio of positions from a single seller), and company-facilitated secondaries (where the company itself organizes a secondary transaction, often as part of a new funding round, to provide liquidity to early investors or employees).

Growth of Secondary Activity. Secondary transaction volume in the Saudi VC market has grown significantly since 2022, driven by several factors: the maturation of early-vintage Saudi VC portfolios (funds that invested in 2017–2019 are approaching the point where LP liquidity expectations require some portfolio realizations), the entry of international secondary funds into the MENA market (providing dedicated capital for secondary purchases), and the increasing willingness of Saudi startup boards to facilitate secondary transactions for early employees and angel investors.

Pricing and Valuation. Secondary transaction pricing in the Saudi market is influenced by the most recent primary funding round valuation, the company’s recent financial performance, the buyer’s own valuation analysis, and the seller’s urgency (distressed sellers typically accept discounts to the most recent primary round, while patient sellers can often achieve prices at or above the last round). Discount levels in Saudi secondary transactions vary widely, from single-digit discounts for high-quality, fast-growing companies to 30–40 percent discounts for companies with uncertain prospects.

Exit Metrics and Benchmarks

Several metrics provide insight into the current state of Saudi startup exit activity.

Total Exit Value. Cumulative exit value from Saudi VC-backed companies — including IPOs, M&A transactions, and secondary sales — is estimated to have exceeded $5 billion since 2019, with the Careem exit representing the single largest component. Excluding the Careem transaction, cumulative exit value is in the range of $1.5–2.5 billion, reflecting the earlier-stage profile of the broader portfolio.

Exit Volume. The number of exit events per year has grown from fewer than five in 2019 to approximately 15–20 in 2025, including IPO listings, M&A transactions, and significant secondary sales. While the trend is positive, the volume remains modest relative to the number of active VC-backed companies in the Kingdom (over 500), suggesting that significant portfolio maturation is still required.

Time to Exit. The average time from first institutional funding to exit for Saudi startups is currently estimated at five to seven years, comparable to global VC market averages. This metric is expected to compress as exit infrastructure matures and as more pathways (including Nomu listings, domestic M&A, and secondary sales) become available.

Institutional Developments Supporting Exits

Several institutional developments are strengthening the Saudi exit infrastructure.

CMA Reforms. The Capital Markets Authority has introduced several reforms designed to facilitate startup listings, including streamlined prospectus requirements for Nomu listings, reduced timeframes for CMA review and approval, introduction of dual-class share structures (allowing founders to maintain voting control after listing), and expanded definition of qualified investors eligible to trade on Nomu.

Market-Making Programs. The introduction of market-making programs on Nomu — where designated market-makers provide continuous bid and ask quotes for listed securities — has improved trading liquidity and reduced bid-ask spreads, making Nomu listings more attractive for both companies and investors.

Investment Banking Capabilities. The development of investment banking capabilities focused on technology company advisory — including IPO advisory, M&A advisory, and private placement services — has deepened the Saudi financial system’s capacity to support startup exits. Several Saudi investment banks and advisory firms have established dedicated technology practices, and international investment banks with Saudi offices are increasingly active in advising on startup transactions.

Case Studies: Notable Saudi Startup Exits

Examining specific exit events provides concrete insight into how the Saudi exit landscape operates in practice.

Careem (M&A, $3.1 Billion). The 2020 acquisition of Careem by Uber remains the landmark exit in MENA startup history. Careem, while headquartered in Dubai, had significant Saudi operations and Saudi investors (including STV). The transaction demonstrated that MENA-founded technology companies could achieve billion-dollar exits through strategic acquisition by international buyers. The Careem exit validated the MENA VC model and catalyzed a wave of institutional investment that continues to shape the market.

Jahez (IPO, Nomu). Jahez’s listing on the Nomu parallel market was the first significant IPO exit for a Saudi venture-backed startup. The listing validated Nomu as an exit pathway, demonstrated that Saudi public market investors would pay premium valuations for growth-stage technology companies, and established precedents for the listing process that subsequent companies have followed. Jahez’s post-IPO performance — while volatile — generated meaningful returns for pre-IPO investors.

Sector-Specific M&A. Beyond these marquee transactions, numerous smaller M&A exits have occurred across the Saudi startup ecosystem. Fintech companies have been acquired by banking groups seeking to add digital capabilities. E-commerce companies have been acquired by larger platforms seeking to consolidate market position. And enterprise software companies have been acquired by international technology firms seeking to enter the Saudi market. These smaller exits, while individually less significant than Careem or Jahez, collectively demonstrate the breadth of exit opportunities available.

Structural Comparison with Other Emerging VC Markets

Comparing Saudi Arabia’s exit infrastructure with other emerging VC markets provides useful context for evaluating the Kingdom’s development trajectory.

India. India’s VC exit landscape benefits from a large and liquid public equity market (BSE and NSE), a deep base of domestic institutional investors, and a well-developed M&A advisory ecosystem. India has produced numerous VC-backed IPOs and several large M&A exits. Saudi Arabia’s exit infrastructure is less developed than India’s but is developing faster.

Southeast Asia. Southeast Asian VC markets — particularly Singapore and Indonesia — face exit challenges similar to those in Saudi Arabia: limited domestic public market liquidity for technology companies, reliance on cross-border M&A for the largest exits, and developing secondary market infrastructure. The comparison suggests that Saudi Arabia’s exit challenges are common to emerging VC ecosystems at similar stages of development.

Brazil. Brazil’s B3 exchange has hosted several successful VC-backed IPOs, providing a model for how emerging-market exchanges can serve as exit venues for technology companies. Saudi Arabia’s Nomu market is following a similar developmental pathway, with the potential to achieve comparable exit volumes as the market matures.

Forward Outlook

The Saudi startup exit landscape is projected to develop significantly over the next five years, driven by portfolio maturation (the large volume of companies funded in 2018–2022 will approach exit-readiness), institutional improvements (continued CMA reforms, Nomu market development, and investment banking capability building), and the demonstration effect of successful exits (each successful exit encourages subsequent companies and investors to pursue similar pathways).

Annual exit value from Saudi VC-backed companies is projected to reach $2–4 billion by 2028, supported by a combination of IPO activity on Nomu and potentially the main market, domestic and cross-border M&A, and secondary market transactions. The growth of exit activity is the single most important factor in the Saudi VC ecosystem’s transition from government-catalyzed growth to self-sustaining market dynamics.

The exit landscape remains the Saudi VC ecosystem’s greatest development opportunity — and its most critical risk. Investors who believe that the exit infrastructure will develop in line with projections should find the Saudi VC market highly attractive. Those with concerns about exit liquidity should size their Saudi allocations accordingly, maintaining exposure but managing concentration risk until the exit track record is more firmly established.

For capital markets infrastructure, see Tadawul Overview and Nomu Market. For the IPO pipeline including startup listings, visit IPO Pipeline. For the broader VC landscape, see VC Landscape. For specific company profiles, visit STV Fund and Startup Ecosystem.