The MENA region’s venture capital activity witnessed a significant rebound in May 2023, according to Wamda’s monthly startup ecosystem investment report, which was released lately, as venture funding into the region’s startups touched $445 million spread across 39 transactions, compared to $7 million raised across 11 deals reported in April 2023.
On a year-on-year basis, the deal volume registered a noteworthy increase of 153 percent, while the volume decreased by seven percent.
Country-wise, the UAE led the pack with $422 million raised across 14 deals, accounting for 90 percent of the total raised. The funding was led mainly by BNLP startup Tabby’s $350 million debt round. Qatar captured the second spot for the first time with $12 million raised by super app Snoonu, followed by Saudi Arabia with $6 million raised across 15 deals. Taking out Tabby’s debt round, the total amount raised in the region drops to $95 million, with the UAE accounting for $71.6 million of that.
In terms of deal count, Saudi Arabia topped the charts thanks primarily to the graduation of seven homegrown startups from the Flat6labs Riyadh accelerator program.
In terms of sectors, fintech continues to retain its place as a preferred destination for VC funding, both with and without Tabby’s round, while e-commerce fetched the second-highest amount of funding owing to UAE-based Squatwolf’s $30 million round. Snoonu’s round pushed its respective sector to the third rank.
Dealmaking in the later stages of funding has seen improvement after being severely impacted under shaky market conditions. Seed and pre-Seed startups continue to dominate deal volume.
Startups with all-male founding teams attracted the majority of funding with 92.8 percent, while startups with male and female co-founders raised 7.2 percent of the total. Only one female-founded startup raised investment in May – a $10,000 grant from Egyptian health tech, Chefaa.
Last month, Balad, Twig, Chari, and the Open Network reported to have raised seven-figure rounds without disclosing the exact amount so we assigned them $1,000,000 each. Other startups that did not disclose they’re smaller fundraises were Bayotina, Cargoz, Helpoo, Thirty Sleeps, Sa7lyy, Lisan, and Sinterex; we have assigned them a conservative amount of $100,000 each.
Mirroring the funding pattern, the UAE also was home to five acquisition deals. That includes ZainTech’s acquisition of UAE-based Adfolks, EDGE’s acquisition of Jordan’s MARS Robotics, RTE’s acquisition of Galaxy Racer, Belgium’s Deliverect’s acquisition of ChatFood, and e& enterprise’s acquisition of Beehive.
Another noteworthy development was the launch of a $10 million Web3 accelerator program by REEF and a fintech incubator in Jordan by JoPACC.
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