UAE based game developer Khosouf Studio has raised USD 600,000 in a seed round led by Merak Capital’s Gaming Fund, supporting its relocation to Saudi Arabia and expansion of narrative driven and VR gaming projects amid growing investment in the MENA gaming market.
UAE based independent game developer Khosouf Studio announced it has raised USD 600,000 (approximately SAR 2.2 million) in seed funding from Merak Capital’s Gaming Fund, advancing its narrative driven and virtual reality titles as it relocates to Saudi Arabia. The financing represents a material boost to the studio’s capacity to develop original intellectual property across multiple platforms.
Founded in 2020 by CEO Ahmad Al Natsheh, Khosouf Studio specializes in premium PC, console, and virtual reality games. The studio’s portfolio spans more than 20 interactive experiences, including the internationally released BOX to the BEAT VR, and it is currently developing two original titles: The Panic Pit, a cinematic adventure, and Glitch Core, a cooperative first-person shooter roguelite. These projects align with regional efforts to cultivate local game content capable of international competitiveness.
The seed round was facilitated through Merak Capital’s Gaming Fund, a dedicated investment vehicle launched in 2024 with backing from the National Development Fund (NDF) to support early stage gaming studios that develop original intellectual property. The fund is reported to be sized at approximately USD 80 million (SAR 306 million) and aims to accelerate local and international studios relocating to Saudi Arabia as part of broader digital and cultural growth strategies.
Merak Capital, licensed by the Saudi Capital Market Authority, manages multiple investment vehicles across technology and gaming sectors with assets exceeding SAR 3 billion (USD 800 million) and has underwritten a range of gaming initiatives, including partnerships with Savvy Games Group, which is central to Saudi Arabia’s national gaming and esports ambitions.
Khosouf Studio’s funding round comes amid strong growth in the MENA gaming market, with revenues across Saudi Arabia, UAE, and Egypt estimated at USD 1.92 billion in 2023 and forecast to reach USD 2.65 billion by 2027 at a CAGR of 8.2%. The number of gamers is projected to rise from 68.4 million in 2023 to 79.6 million by 2027, highlighting expanding engagement and market potential.
Saudi Arabia accounted for roughly 20% of total MENA gaming revenue in 2024, generating USD 1.2 billion, supported by initiatives under Vision 2030 to diversify the economy and develop the Kingdom as a hub for gaming and esports. Programs like the National Gaming and Esports Strategy are central to fostering the regional industry.
Other regional studios have also raised capital, contributing to a growing pipeline of interactive entertainment ventures. For instance, Saudi studio Fahy secured USD 1.75 million from Impact46 and Merak Capital to scale mobile game development, signalling continued venture activity in the interactive entertainment sector.
Globally, independent game studios continue to attract investment to fund original IP, immersive experiences, and cross-platform titles, solidifying gaming’s position as a major contributor to digital creative economies.
