Report: a16z to oversee Saudi Arabia’s $40B investment fund for AI

The Saudi Arabian government is reportedly considering the establishment of a $40 billion investment fund to finance artificial intelligence (AI) initiatives, with plans to launch it in the second half of this year. The country’s Public Investment Fund, in collaboration with Silicon Valley venture capital firm Andreessen Horowitz (a16z), may oversee the AI investments. Additional venture capitalists could also participate in the fund, and a16z might open an office in Riyadh, the capital of Saudi Arabia. Ben Horowitz, one of a16z’s founders, is reportedly a friend of the fund’s governor, Yasir Al-Rumayyan. If the fund is created, it would make Saudi Arabia the largest investor in the AI industry. The fund is expected to be financed by Saudi Arabia’s $900 billion sovereign wealth fund and will focus on investing in chip manufacturers and large data centers capable of supporting AI technology. The possibility of establishing its own AI companies has also been considered. Discussions about a potential partnership between Saudi Arabia and a16z have been ongoing since at least April 2023. In an interview with former WeWork CEO Adam Neumann, Horowitz praised Saudi Arabia as a “startup country” and suggested that the United States is losing its position in the startup scene. In October of last year, US President Joe Biden issued an executive order for new AI safety standards, which received commitments from 15 leading AI firms. One of the measures implemented is the use of the Defense Production Act to encourage AI firms to report important information, including AI safety test results, to the Department of Commerce. Meanwhile, OpenAI’s CEO, Sam Altman, recently sought $7 trillion from the United Arab Emirates, Saudi Arabia’s neighboring country, to develop advanced semiconductor chips. In an interview, the CEO of EasyTranslate discussed the impact of AI on the industry and the need for adaptation.