A Quona Case:
Could Riyadh Be The Capital Markets Hub For Africa and The Middle East?
By Monica Brand Engel, Adrienne Henderson, and Param Iyer
Four years ago, one of our portfolio company founders, Omar Saleh, told us that we had to go to Riyadh. ‘You need to see it to believe it.’ And since listening to our founders is our job at Quona, we traveled to Saudi Arabia and witnessed firsthand a financial market in rapid transformation. Since then we have invested in talent in the region and our team, including co-founder Monica Brand Engel, have made over 30 visits to the region. We know this is no longer a region you can cover fly in fly out. And we know this is something you need to see to believe. That’s why we’ve long had a team on the ground in Dubai. It’s why we invested in Octa and Khazna. And it’s one of the reasons why Monica/Quona was the only US VC to be invited to the White House organized US-Saudi Investment Forum in May.
Post the Investment Forum, that view has only become more intriguing. At a recent FinTech roundtable of investors and development finance leaders, many expressed concerns over Africa’s “capital markets problem.” Strikingly, Saudi Arabia was never mentioned as a potential part of the solution. We believe that should change. This article explores Riyadh’s momentum across equity markets, growing IPO and secondary activity, shifting dynamics in historic hubs like London, Africa’s persistent exit dilemma, and how Riyadh may help address it. And hopefully you’ll join us for Money20/20 Riyadh in September 2025 to see for yourself.
The Rise of Riyadh in Capital Markets
Riyadh’s stock market has seen exponential growth, emerging as the leading capital market in the Middle East and North Africa and the eleventh largest globally, with a market capitalization of SAR 9.9 trillion (~USD 2.65 trillion) as of March 2025. Importantly, this growth is not merely in size, it is also in activity. In 2024 alone, Saudi Arabia saw 42 IPOs, making up the majority of all Gulf IPOs and ranking 7th globally in IPO proceeds.
Crucially, the pipeline remains strong: As of early 2025, Saudi Arabia’s exchange had 50+ IPOs in the works, driven by both state-owned and private sector firms across sectors like finance, healthcare, and logistics. This surge reflects a concerted push under Vision 2030 to deepen Saudi Arabia’s capital markets through privatizations, increased foreign participation, and listing incentives. Riyadh has positioned itself as the region’s listing destination of choice, attracting mid-cap issuers and increasing international interest.
A Boom in MENA IPOs, Driven by Saudi
This rise of Riyadh comes as MENA equity markets buck global trends. While worldwide IPO activity has been muted (global IPO proceeds plunged from roughly $460 billion in 2021 to just $121 billion in 2024 amid higher interest rates and risk aversion) the Middle East has surged ahead as an outlier. MENA increased its IPO count 2.5x from 2021 to 2024, even as the US, Europe, and Asia saw steep declines. By 2024, the region accounted for 5% of global IPO volume and 10% of global IPO proceeds, punching far above its weight in capital raised.
This outperformance owes much to Saudi Arabia. In the first quarter of 2025, 12 of the 14 IPOs across MENA took place in Saudi Arabia, an emphatic confirmation that Riyadh is driving the region’s capital market boom. Importantly, deal sizes in MENA tend to be larger than global averages, thanks to mega-deals and listing rules requiring a 25–30% float, which create substantial liquidity. The result is that Riyadh IPOs are routinely oversubscribed many times over, reflecting huge investor appetite. For instance, a recent mid-sized IPO (Specialized Medical Co.) saw institutional orders amounting to 64.7x the shares on offer, with SAR 121 billion (~$32 billion) in bids for a ~$500 million offering. This is not an isolated case; 9 out of the 12 Saudi IPOs were oversubscribed and delivered double-digit post-listing Day 1 jumps. All these indicators point to an active and liquid market hungry for new issuers, underpinned by a proactive regulatory environment.
A Viable Secondary Market with Deep Liquidity
Riyadh’s maturing capital markets are also seeing growth in secondary activity. In 2024, Aramco raised $11.2 billion in a secondary offering, the largest in EMEA since 2000. STC followed with a $1.03 billion accelerated book-build (ABB), a MENA record. Saudi investment banks have also led smaller follow-ons for firms like Bin Dawood and Arabian Contracting Services, enabled by updated CMA regulations designed to improve execution and pricing. Similarly, Rasan’s ABB in early 2025 saw 13.3 million shares (~$245 million) sold at a 4% discount, with books closing in just 15 minutes. Such examples underscore deep institutional liquidity and sophisticated market infrastructure.
The secondaries boom extends beyond public equities. In 2024, an estimated 40% of private capital deployed in private markets in the region came via secondary transactions. GCC-based investors, seeking exposure to technology and growth-stage businesses, are increasingly driving this activity. Altogether, Riyadh now offers not just a venue to list, but a functioning capital ecosystem where capital can recycle and investors can exit.
London’s Waning Allure and the Void to Fill
Contrasting starkly with Riyadh’s dynamism is the decline of London’s capital markets, which for decades served as the go-to international listing venue for companies from Africa and other emerging regions. Today, the London Stock Exchange (LSE) is a shadow of its former self. In 2024, only 18 companies listed on the London Stock Exchange, while 88 delisted or moved their primary listing. This marked the sharpest imbalance since the global financial crisis.
High-profile exits have compounded this trend. ARM, the UK’s semiconductor crown jewel, chose Nasdaq over London for its 2023 IPO. Flutter moved its primary listing to New York in 2024. Just Eat exited the FTSE for Amsterdam, and Revolut has delayed its IPO indefinitely, citing concerns around valuation and regulatory clarity. These moves suggest a broader skepticism among high-growth firms about London’s ability to offer competitive valuations or sufficient investor appetite.
Observers have blamed everything from Brexit uncertainty to an overly “old economy” investor base and cumbersome regulations for London’s woes. Reform efforts are underway, but change will take time. In the interim, the void for global emerging market listings is apparent. This is where Riyadh enters the conversation: Saudi Arabia, seeing the opening, is positioning itself as an alternative international financial center at a moment when issuers are willing to look beyond London. Riyadh’s pitch is essentially: “We have the liquidity and investor appetite that London once offered, but now closer to home for regional companies.” For African firms in particular, this shift could be game-changing.
Africa’s Exit Dilemma in Search of a Solution
For African businesses and their investors, limited exit opportunities have long been a critical pain point. Home markets across the continent tend to be small and illiquid, and regional exchanges (with the notable exception of Johannesburg) often lack the depth to support large IPOs. Historically, African companies looked abroad (frequently to London) to tap global capital and enable investor exits. But with London now faltering, the exit challenge has only intensified. According to the African Private Equity and Venture Capital Association, 76% of LPs cite “limited exit opportunities” in Africa as the single biggest challenge for fund managers. The data bear this out: in a recent year, among 33 tracked African private equity exits, not a single one was via IPO. In fact, in 2019 only 1 out of 44 PE exits on the continent came through a public listing, a startling statistic that highlights the dearth of viable stock market exits for African investors. The traditional playbook of seeking a listing in London or another major global exchange is no longer a sure option, given international investors’ shifting focus and the LSE’s diminishing appetite for African and frontier-market listings. This leaves African companies and their co-investors in search of new exit pathways…and a new capital markets partner that understands high-growth emerging market stories.
Riyadh as the New Exit Pathway for Africa
Enter Riyadh, which is positioning itself as exactly that partner and a natural new hub for African and MENA capital markets. Saudi Arabia’s ambition to be a regional financial center is not just rhetoric; it’s backed by concrete reforms and outreach. Regulatory changes in 2024 explicitly opened the Saudi exchange to foreign issuers, allowing non-Saudi companies to pursue cross-listings or dual listings on Tadawul’s main market. While a foreign company still needs to be listed in its home market or do a concurrent offering, these new guidelines streamline the process and clarify criteria for international listings in Riyadh. In other words, an African champion can now list on the Saudi Exchange without reincorporating in Saudi Arabia, via a secondary listing route, a door that was effectively closed before. Saudi regulators require that foreign issuers demonstrate “added value” to the Saudi market and economy, but the intent is clear: attract high-quality international companies and make Riyadh a key financial hub for the region and Global South. Early moves show promise. The Saudi exchange operator signed a landmark agreement with the Johannesburg Stock Exchange in May 2024 to explore dual-listings and broader market cooperation. Through such partnerships, Riyadh is literally building the bridge for African companies to tap Gulf investors and vice versa.
The appeal of Riyadh as an exit venue for African firms rests on several compelling advantages:
· Deep Capital and Liquidity: Saudi Arabia’s investor base, from sovereign funds to retail, is flush with capital thanks to oil revenues and economic growth. IPOs in Riyadh attract huge demand (often tens of billions of dollars in orders), which can translate into higher valuations and successful exits for shareholders. By contrast, London’s investor appetite for emerging market plays has been tepid in recent years. Riyadh offers African issuers a vast pool of liquidity in a market hungry for diversification and growth opportunities.
· Strong Performance and Investor Confidence: MENA markets have delivered resilient performance. Even amid global volatility, MENA IPOs have maintained momentum and increased market share. Companies listing in Saudi often see robust post-listing trading and coverage. This confidence is underpinned by Saudi’s stable macroeconomic outlook and proactive market reforms. For African firms with solid fundamentals, a Riyadh listing could unlock a valuation premium and analyst attention they might not receive elsewhere.
· Strategic Geography and Networks: Riyadh sits at the crossroads of MENA and is expanding its economic ties with Africa. The Saudi government and its institutions (like the Public Investment Fund, which has already deployed ~$75 billion in Africa) are heavily investing in the continent’s future, from infrastructure to tech startups. This strategic alignment means Saudi investors are familiar with African opportunities and increasingly active on the continent. A Riyadh listing can tap not only Saudi capital but also the broader GCC investor network, which has a growing interest in Africa’s growth story. The Kingdom’s positioning as a “gateway to MENA” is now extending southward, with Saudi officials openly championing Africa’s potential and even calling for greater African representation in global financial bodies. All this points to a sympathetic and engaged investor audience in Riyadh for African issuers, something difficult to replicate in London or New York.
· Regulatory Support and Vision 2030 Commitment: Saudi regulators have shown flexibility and innovation in building their markets. From encouraging mid-cap IPOs and private sector listings to creating a parallel market (Nomu) for smaller firms, they are widening access to capital. For foreign companies, the clear guidelines issued for foreign listings in 2024 remove the earlier uncertainty that deterred cross-listings. Moreover, Saudi’s Vision 2030 ensures that developing the financial market is a national priority backed at the highest levels. The Financial Sector Development Program under Vision 2030 explicitly aims to make Saudi Arabia a regional financial hub. An African company listing in Riyadh would likely be welcomed as further validation of this vision, possibly garnering regulatory goodwill and market spotlight.
No emerging hub is without its challenges. For all of its promise, Riyadh must overcome several challenges to become a truly global capital markets hub.
· Primarily Local Investor Base (For Now): Despite opening to foreigners, the Saudi market is still dominated by local investors. International ownership of the Saudi exchange is estimated at only ~13%, compared to, for example, 65% of the London market being held by international investors. And as of today, not a single non-GCC company is listed on Tadawul.
· Listing Requirements: The new foreign listing guidelines, while enabling, will still limit access for smaller African companies. Thus, Riyadh’s emergence as a hub may mostly benefit the upper echelon of African companies in the near term.
· Market Familiarity: African issuers may lack visibility among Saudi investors, and vice versa. Bridging this gap will require investor education, analyst coverage, and cultural fluency.
· Geopolitical and Economic Cycles: Despite reforms, Saudi market sentiment remains sensitive to oil prices and regional dynamics. Some investors may view this as a structural risk relative to more established markets.
· Competition from Other Hubs: Finally, Riyadh is not alone in vying for this role. Dubai and Abu Dhabi have also stepped-up efforts to attract listings (Dubai has announced initiatives to list state companies and support technology-focused IPOs, and Abu Dhabi’s ADX has had several large listings). As a result, Tadawul will have to compete and differentiate itself, likely through valuation uplift and easier access to GCC capital.
These challenges are not insurmountable, but they warrant realistic appraisal. Riyadh’s quest to become a capital markets hub will be a journey, not an overnight switch.
Already, the shift is underway. Market insiders report that multiple foreign companies (including from outside the GCC) are in talks to list on the Saudi Exchange in sectors like energy and natural resources. Egypt-based regional fintech businesses like Paymob and Khazna have the exchange in their sights. It is not far-fetched to imagine African champions among them — whether a North African energy firm, a pan-African fintech, or a leading Sub-Saharan industrial player — tapping Riyadh’s markets for growth capital and providing their early investors a long-sought exit. The blueprint has been drawn by trailblazers like Americana Restaurants, which in late 2022 executed a dual listing on Riyadh and Abu Dhabi’s exchanges. The success of such listings sends a message: the Gulf markets are open for business to regional and African firms in a way they never were before.
A New Hub for a New Era
All signs point to Riyadh taking up the mantle as the capital markets hub for Africa and the Middle East in this new era. The timing could not be more apt. With legacy centers like London losing momentum, the fast-growing economies of Africa and MENA need a vibrant platform to connect enterprises with global capital. Riyadh offers just that: scale, liquidity, and enthusiasm on par with the best of global exchanges, combined with regional proximity and understanding. It is a market where a construction firm from Cairo or a telecom from Nairobi can capture investors’ attention alongside a petrochemical giant from Riyadh. Crucially for LPs and co-investors, it presents a viable exit pathway, one where the door to public markets is open wider than it has ever been in this part of the world. The case for Riyadh rests on hard data and a strategic narrative: a market doubling IPO proceeds when others halved, a government pouring resources into market infrastructure and a region’s capital looking for new frontiers to invest.
For the African investment community, supporting Riyadh’s rise is ultimately about expanding our own horizons. A robust Riyadh hub means African startups and corporates can dream beyond constrained local IPO markets or an indifferent London listing. It means Middle Eastern and African capital can circulate more freely, funding growth and enabling exits without always detouring through Western financial centers. In Riyadh, we see a platform where African ventures can achieve liquidity events that reward early investors and fuel the next cycle of growth. The message to co-investors and LPs is clear: embrace Riyadh as our shared capital market hub. It’s where the action is, where the money is, and where the future of African and MENA capital markets is being written. By channeling deal flow and listings toward Riyadh, we are not only leveraging a market that works; we are helping forge a new axis of emerging-market capital that stands to benefit us all. In a world where the London exit is fading, Riyadh is rising to take its place, and we should rally behind it.
Conclusion
In summary, Riyadh stands out as a compelling new capital markets hub for the Middle East and Africa at a time when traditional centers are faltering.
For African companies, Riyadh offers the potential to raise capital, unlock liquidity, and achieve visibility without leaving the region. For investors, it offers access to growth-stage businesses in markets they increasingly understand. And for policymakers, it represents a regional solution to a regional problem: how to scale capital markets for high-growth, high-potential emerging economies.
We believe the evidence and trends we’ve discussed make an argument that Riyadh is on track to assume the mantle of regional capital markets hub. None of the above implies abandoning other markets entirely; rather, it adds another venue in the toolbox. For investors, it’s an opportunity to back emerging market champions in a market that is progressively opening up. For companies, it’s a chance to access deep capital without straying too far from home.
