a16z Main Fund's First Investment in the Gulf Region

According to Bloomberg, Andreessen Horowitz (a16z) led a $25 million Series A funding round for Saudi enterprise software company Stitch. This is the first time a16z's main fund has invested in the Gulf region, with Arbor Ventures, COTU Ventures, Raed Ventures, and SVC, among others, also participating in this round of financing.

Stitch, headquartered in Riyadh, primarily provides software systems for financial institutions. Its platform covers customer onboarding, transaction monitoring, and the management of financial products such as accounts, bank cards, loans, and payments, aiming to challenge traditional banking software suppliers like Temenos AG, Fidelity National Information Services Inc., and Fiserv Inc.

The core pain point in this type of business is that banks and large financial institutions often connect to multiple software vendors and third-party banking systems simultaneously, leading to fragmented processes and high maintenance costs. Stitch hopes to integrate more segments with a single platform to reduce the fragmentation of software systems in financial institutions.

For a16z, the Gulf is not an entirely unfamiliar market. It had previously invested in Dubai real estate tech startup Smart Bricks through Speedrun accelerator, but Bloomberg states that this time is its first investment in the Gulf under its main fund system. This venture capital firm, based in Menlo Park, California, manages $90 billion in funds and had discussed artificial intelligence investment tools with the Saudi Public Investment Fund in 2024.