Startups in the MENA region have raised $95 million across 31 deals in July 2023, a slight dip from the $105 million recorded in the same month last year, according to the MENA Startup Ecosystem Investment Report, published by Wamda in collaboration with the Digital Digest.
Month-on-month, the dollar figure showed a 167 percent increase from June’s $35.6 million, while the deal volume fell by 31 percent. However, the picture shifts slightly when we take out One Moto’s $40 million lease financing round, reducing the equity investment of July to $55 million, a 55 percent increase month-on-month.
Further, without One Moto’s round, the total amount raised by UAE-based startups was just $14 million across nine deals, less than the $18 million raised by five Saudi Arabia-based startups. Foodtech Kaso, based in Riyadh, raised the largest round with a $10.5 million Seed.
Egypt and Morocco secured the third and fourth spots, attracting $7 million and $2 million, respectively.
With 15 deals, Seed and pre-Seed stage startups dominated the deal volume. Funding for late and growth-stage startups has contracted a large contributor to the slowdown in venture capital activity in July.
As the largest fundraiser of the month, One Moto’s round helped the mobility sector become the top-funded sector of July. Foodtech, however, is believed to be the largest beneficiary of capital raised in July, with $17 million raised across five deals, fueled by the growing adoption of enterprise SaaS solutions in the F&B sector. Fintech attracted four deals but remained off the list of the top-funded sectors in July.
Gender-wise, female-founded startups remain heavily underfunded, with most capital raised through accelerators and incubators. In July, only one deal went to a female-led startup, Jordianin proptech Nomad, a recent graduate of the Flat6labs Amman accelerator programme.
Mixed-gender founding teams fared better, attracting $12 million across six deals. All-male-led startups grabbed 87 percent of the total funds, to the tune of $84 million. The most active foreign investors were based in the US, participating in 10 deals. Regionally, investors based in Egypt and the UAE both participated in eight deals, while Saudi Arabia-based investors took part in seven deals.
Aside from funding, last month saw a couple of acquisition deals including Jordan-born and Saudi-based HyperPay’s acquisition of Sanad Cash and the Abu Dhabi-owned EDGE Group’s acquisition of OrxyLabs. Meanwhile, Germany’s Delivery Hero acquired the remaining shares of Saudi Arabia’s food delivery platform, HungerStation for $297 million.
Other key highlights include the launch of $54 million for the tech-focused fund by Agthia Group as well as a new accelerator programme geared towards Egypt-based accelerator and incubator managers by 500 Global.
Last month, eight startups did not disclose the exact amount they raised. They include Dharma, Kaco, Oumla, Menthum, and Tenderd, we assigned a conservative amount of $100,000 to the first four and $1 million to Tenderd.
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