EFG Hermes deploys $100 million to transform K-12 schools and align private investment with Vision 2030. Saudi Arabia’s education sector is experiencing unprecedented growth, with private K-12 enrolment set to double by 2030. At the forefront of this transformation is the EFG Hermes Education Fund, which has already deployed over $100 million in just one year to acquire six schools serving 14,000 students.
Co-CEO of EFG Hermes, an EFG Holding company, Karim Moussa explains how the fund is delivering over 25 percent returns while advancing Vision 2030’s goal of building a knowledge-based economy, focusing on STEM education, digital literacy, and teacher training initiatives that bridge the gap between market demand and educational access.
How does the EFG Hermes Education Fund align with EFG Hermes’ broader mission and values?
The EFG Hermes Education Fund is closely aligned with EFG Hermes’ overarching mission of fostering sustainable economic growth, social development, and innovation across its markets of operation. EFG Hermes has a longstanding commitment to supporting initiatives that drive positive change and empower communities.
By investing in education, the Fund directly contributes to building human capital, a cornerstone of long-term economic and social advancement. The Fund embodies values such as integrity, inclusivity, and a commitment to excellence, ensuring that quality education is accessible and impactful in Saudi Arabia.
What long-term impact do you envision the Fund having on the educational landscape in the region?
The long-term vision for the EFG Hermes Education Fund in Saudi Arabia is to transform the country’s educational ecosystem by fostering innovation, promoting access to quality education, and preparing students for the demands of a rapidly evolving job market. The Fund aims to bridge gaps in educational infrastructure, support teacher development, and introduce progressive learning methodologies.
Over time, these efforts are expected to elevate educational standards, enhance employability, and support Saudi Arabia’s broader goals under Vision 2030, which emphasises knowledge-based economic growth and human capital development.
What criteria do you use when selecting initiatives or institutions to support? And are there particular fields of education that the Fund prioritises?
The EFG Hermes Education Fund follows a comprehensive and thoughtful approach when selecting which educational initiatives or institutions to support in Saudi Arabia. The process centres around the following key criteria:
- Impact potential: The Fund prioritises projects that can make a significant, positive difference in educational outcomes, with special focus on underserved or disadvantaged communities.
- Sustainability: Initiatives are evaluated for their long-term viability, ensuring lasting improvements rather than short-term fixes.
- Alignment with national priorities: Supported initiatives must align with Saudi Arabia’s broader educational reforms and Vision 2030 goals.
- Innovation: Preference is given to projects introducing new ideas, technologies, or teaching methods, such as digital tools, modern curricula, or unique pedagogical approaches.
- Measurable outcomes: Every project must have clear objectives and ways to track progress, allowing the Fund to assess real impact and ensure accountability.
The Fund focuses primarily on K-12 education. Saudi Arabia’s K-12 sector is one of the largest in the region, with more than 6 million students enrolled in 2023. Education accounts for approximately 19 percent of the national budget, totalling around $51 billion. The private K-12 market is expanding by nearly 10 percent annually, with student enrolment in private schools expected to double by 2030.
In terms of educational fields, the Fund prioritises:
- STEM education: Science, Technology, Engineering, and Mathematics to equip students with critical future skills.
- Digital literacy: Promoting technology use and digital skills for a rapidly digitalising world.
- Teacher training: Empowering educators with modern teaching methods, professional development, and leadership skills.
- Early childhood education: Supporting foundational learning for young children, recognising the lifelong benefits of early interventions.
Can you share some success stories or measurable outcomes from the fund so far?
- Over $200 million of capital has been raised, primarily from prominent Saudi families and institutions.
- In one year, over $100 million was deployed.
- Six assets with a total capacity of around 14,000 students were secured, including three new launches. Leading names include GEMS American International School Riyadh and Hayat International Academy from Egypt, which is entering the Saudi market.
- A central operating team of approximately 30 employees has been built in the Kingdom.
What are the Fund’s strategic priorities for the next five to ten years?
Over the next five to ten years, the EFG Hermes Education Fund will pursue a dual-focused strategy to deliver superior returns to investors, targeting IRRs of more than 25 percent, while simultaneously driving developmental impact across Saudi Arabia’s educational sector.
The Fund aims to capitalise on the strong and growing demand for quality K-12 education, investing in scalable businesses and initiatives that demonstrate both financial potential and transformative educational value. Central priorities include:
- Investing in scalable, high-growth K-12 platforms and services that deliver both strong financial performance and measurable learning improvements.
- Accelerating digital transformation and innovation in education, ensuring broad access to technology and modern learning experiences.
- Building public-private partnerships to leverage resources, expertise, and policy alignment for systemic impact.
- Prioritising workforce readiness by supporting educational initiatives aligned with market needs and future-focused skills.
- Promoting inclusion and access to ensure all segments of society, especially marginalised groups, benefit from quality education.
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