Stake, a Dubai-based digital platform for real estate investment, has successfully raised $14 million in its Series A funding round. The investment was led by Saudi Aramco's venture capital arm and Abu Dhabi's sovereign wealth fund, Mubadala Investment Co.
Why It Matters: The Series A funding round, which also included U.S.-based private investing platform Republic, was spearheaded by Middle East Venture Partners, as per a Bloomberg report. The startup, which declined to disclose its valuation, plans to utilize a portion of the funds to enter the Saudi Arabian market.
Stake, which employs a fractional ownership model, allows property investments starting from 500 dirhams ($136). The platform boasts over 500,000 users, with 50% of them being from outside the United Arab Emirates. The firm aims to become the first platform to enable individuals outside the kingdom to invest in the local real estate market.
Co-founder Manar Mahmassani expressed optimism about the Saudi market, citing "huge tailwinds from pent-up demand from the local population and opening up to foreign ownership." The company plans to triple its headcount in the kingdom to 15 by the end of the year.
Since its launch in 2021, Stake has raised $13 million from seed and pre-Series A funding. The company has so far acquired over 200 properties worth 355 million dirhams, according to the statement.
What's Next: The investment from Saudi Aramco and Mubadala aligns with broader economic strategies in the region. Recently, Saudi Aramco announced an $11.2 billion stock sale to support Saudi Arabia's economic transformation plans. This move is part of Crown Prince Mohammed bin Salman's Vision 2030 initiative, aimed at diversifying the kingdom's economy away from oil dependency.
Additionally, Aramco is in talks with Tellurian Inc. and NextDecade Corporation for LNG projects, indicating its interest in expanding its energy portfolio. This diversification strategy is evident in its investment in Stake, a fintech company focusing on real estate, a sector experiencing significant growth in Dubai.
Meanwhile, Mubadala has been actively investing in various sectors, including a $1 billion private credit deal with Goldman Sachs to capitalize on the Asia-Pacific market. This diversified investment approach underscores Mubadala's strategy to seek high returns across different asset classes.
Furthermore, Saudi Arabia's sovereign wealth fund recently invested $250 million in a healthcare fund, Afiyah, to boost the kingdom's healthcare sector.