Saudi Arabia launched a new Information, Communication and Technology (ICT) venture called "Riyadh Taqnia Capital" to fund start-ups. The venture is reportedly worth $133 million.

The fund will be headquartered in Saudi Arabia's capital city Riyadh, but will operate its international unit from California in the US. The fund will also explore investments in energy, advanced material and sustainability, Deal Street Asia said.

According to reports, some of the partners for the fund are: Riyadh Financial Capital, General Pension Fund, and General Investment Fund, besides various other state-linked funds.

"Because the majority of science and technology innovation takes place in developed economies such as the US, Western Europe and Japan, Taqnia Investments will make numerous investments in early-stage companies in developed innovation ecosystems such as the Silicon Valley," Taqnia's website explained.

The fund seeks to focus on technologies relevant to Saudi Arabia, such as water desalination, renewable energy, and oil and gas exploration. In the long run, the company will ensure suitable risk management and sustainable financial returns.

"The venture fund seeks to be a major player in the kingdom's innovation development ecosystem, by supporting and investing in suitable local and international research and development that would fuel the growth of selected technologies which can lead towards technology leadership, sustained economic growth, and self-reliance for the desert kingdom," Taqnia added.

In a country known mostly for its oil and gas industry, the fund's main target is the growing the venture capital sector.

Since the local commercial banks hesitate to "fund light-commercial operations" under which most technology companies are categorised, there arises a need for capital growth, Deal Street Asia added.