Saudi Arabia in talks for $40 billion AI investment fund with top VC firms including Andreessen Horowitz

In a bold move set to redefine the landscape of artificial intelligence investment, Saudi Arabia’s sovereign wealth fund is reportedly in advanced talks with renowned American venture capital firm Andreessen Horowitz, potentially paving the way for a colossal $40 billion fund, as per reports by the New York Times and later confirmed by CNBC sources.

Sources familiar with the matter told to CNBC that these discussions have been underway for several months, indicating a strategic alliance between Saudi Arabia’s formidable $925 billion Public Investment Fund (PIF) and Andreessen Horowitz, a heavyweight in Silicon Valley’s venture capital scene.

Although talks are yet to be finalized, individuals close to the matter, speaking on the condition of anonymity due to media constraints, emphasized that Andreessen Horowitz and PIF are the primary entities involved in the negotiations, with no mention of additional potential participants, CNBC reported.

The move underscores PIF’s aggressive investment strategy aimed at steering Saudi Arabia’s economy away from its traditional reliance on oil, a cornerstone initiative under Crown Prince Mohammed bin Salman’s Vision 2030 agenda. Notably, PIF has previously made substantial investments in high-profile entities such as Uber, Bank of America, Citi, SoftBank, and Blackstone.

On the other side, Andreessen Horowitz boasts a formidable track record with $35 billion in assets under management, having nurtured successful ventures like Airbnb, Coinbase, Facebook, and Slack. The firm’s commitment to AI is palpable, evident in its extensive portfolio of nearly 100 AI-related startups.

In a pivotal blog post on the firm’s website penned by co-founder Marc Andreessen in June 2023, he articulated the imperative of aggressively pursuing global AI dominance, emphasizing the considerable threat of failing to do so.

The proposed collaboration between PIF and Andreessen Horowitz not only marks a significant milestone in AI investment but also underscores the increasing convergence of global financial heavyweights in propelling the development and deployment of transformative AI technologies.