MENA Startup Funding Sees Surge in May 2024
Investment Jumps 413% Month-over-Month
The Middle East and North Africa (MENA) startup ecosystem saw a significant increase in funding in May 2024. Startups raised a total of $282 million, a massive 413% jump compared to April's $55 million. This growth was driven by debt financing, which contributed nearly $140 million.
However, despite the impressive monthly growth, the total deal value dropped by 58% year-over-year from $445 million in May 2023.
UAE Leads in Investment, Proptech Takes Top Spot
The United Arab Emirates (UAE) attracted the most investment, with startups securing $189 million across 23 deals. Saudi Arabia followed with $56 million, and Egypt came in third with $24.5 million.
The proptech sector emerged as the leader in terms of funding, even excluding Property Finder's $90 million debt round. Proptech startups raised $167.2 million over seven deals. Fintech followed with $32.7 million, and logistics startups secured $25.3 million.
Later-Stage Funding Gains Traction
May witnessed a focus on later-stage funding rounds. Five startups raised $59.3 million in Series A rounds, and another four secured $44 million in pre-Series A rounds. Seed funding remained active with seven deals totaling $11 million.
B2C Model Dominates, Female Founders See Slight Increase
The business-to-consumer (B2C) model attracted the majority of funding, with startups raising $174 million across 13 deals. Business-to-business (B2B) startups secured nearly $100 million.
While male founders continued to dominate, attracting 89% of the total investment, May saw a rise in deals involving female co-founders. The number of deals doubled from April, securing $28.6 million. However, startups founded solely by women received only $800,000.
Active VC Landscape in the Region
May saw significant activity in the venture capital (VC) space. Several new funds were launched, with a focus on the Saudi ecosystem. These included a $100 million fund by BIM Ventures and Japan's SBI Holdings, a $250 million healthcare fund by TVM Capital Healthcare, and a $30 million commitment by Saudi Venture Capital to a US-based firm for investment in Saudi startups.
Investment firms from other regions also entered the MENA market. Singapore's Golden Gate Ventures launched a $100 million MENA fund, while Bahrain's Investcorp closed a $570 million fund and Shorooq Partners partnered with Korea's IMMG for a $100 million fund.
Saudi Arabia's Kingdom Holding Invests in Global AI Startup
It's noteworthy that Saudi Arabia's Kingdom Holding participated in a $6 billion Series B round for Elon Musk's artificial intelligence (AI) startup, xAI.
Investment Jumps 413% Month-over-Month
The Middle East and North Africa (MENA) startup ecosystem saw a significant increase in funding in May 2024. Startups raised a total of $282 million, a massive 413% jump compared to April's $55 million. This growth was driven by debt financing, which contributed nearly $140 million.
However, despite the impressive monthly growth, the total deal value dropped by 58% year-over-year from $445 million in May 2023.
UAE Leads in Investment, Proptech Takes Top Spot
The United Arab Emirates (UAE) attracted the most investment, with startups securing $189 million across 23 deals. Saudi Arabia followed with $56 million, and Egypt came in third with $24.5 million.
The proptech sector emerged as the leader in terms of funding, even excluding Property Finder's $90 million debt round. Proptech startups raised $167.2 million over seven deals. Fintech followed with $32.7 million, and logistics startups secured $25.3 million.
Later-Stage Funding Gains Traction
May witnessed a focus on later-stage funding rounds. Five startups raised $59.3 million in Series A rounds, and another four secured $44 million in pre-Series A rounds. Seed funding remained active with seven deals totaling $11 million.
B2C Model Dominates, Female Founders See Slight Increase
The business-to-consumer (B2C) model attracted the majority of funding, with startups raising $174 million across 13 deals. Business-to-business (B2B) startups secured nearly $100 million.
While male founders continued to dominate, attracting 89% of the total investment, May saw a rise in deals involving female co-founders. The number of deals doubled from April, securing $28.6 million. However, startups founded solely by women received only $800,000.
Active VC Landscape in the Region
May saw significant activity in the venture capital (VC) space. Several new funds were launched, with a focus on the Saudi ecosystem. These included a $100 million fund by BIM Ventures and Japan's SBI Holdings, a $250 million healthcare fund by TVM Capital Healthcare, and a $30 million commitment by Saudi Venture Capital to a US-based firm for investment in Saudi startups.
Investment firms from other regions also entered the MENA market. Singapore's Golden Gate Ventures launched a $100 million MENA fund, while Bahrain's Investcorp closed a $570 million fund and Shorooq Partners partnered with Korea's IMMG for a $100 million fund.
Saudi Arabia's Kingdom Holding Invests in Global AI Startup
It's noteworthy that Saudi Arabia's Kingdom Holding participated in a $6 billion Series B round for Elon Musk's artificial intelligence (AI) startup, xAI.
