August 2024 marked a significant month for the MENA (Middle East and North Africa) startup ecosystem, with a total funding amount of $566 million across 43 startups. This substantial inflow of capital highlights the growing importance of the region on the global entrepreneurial stage.
Investments were secured across various sectors, stages, and geographies, reflecting the increasing confidence of investors in MENA’s innovation potential. However, certain gaps and disparities, such as the underrepresentation of female founders, persist.
This comprehensive report by Rasmal provides an in-depth analysis of the MENA startup funding landscape in August 2024, examining total funding amounts, funding stages, gender distribution, geographical distribution, and industry trends.
Total Funding Amount
The MENA region secured an impressive $566 million in total funding during August 2024. This marks a significant inflow of capital, signifying investor confidence in the region’s potential to foster innovation.
The majority of the funding came through corporate rounds, which alone contributed $463 million. Corporate investors are increasingly recognizing the value of backing startups, particularly those that align with their long-term strategic goals.
Apart from corporate rounds, the total funding amounted to $103 million, a reflection of the growing interest in venture-backed startups, especially those at early stages. Seed-stage startups were a focal point for investors, suggesting that MENA continues to be fertile ground for new business ventures.
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Total Number of Funded Startups
A total of 43 startups received funding in the MENA region in August 2024. This number illustrates the vibrant startup environment in the region, with a diverse range of ventures attracting capital.
The UAE continues to lead the region in both the number of funded startups and the total amount of funding, further establishing its status as the entrepreneurial hub of the Middle East. Other countries like Saudi Arabia and Egypt also demonstrated strong performances in terms of attracting investment.
The focus on early-stage startups, as evidenced by the dominance of seed funding rounds, indicates a healthy pipeline of new businesses emerging in the region.
However, the relatively low number of startups securing Series A or later-stage funding suggests potential challenges in scaling and securing growth capital, which will be a key factor to monitor moving forward.
Funding Amounts According to Stages
Funding rounds were categorized into different stages: corporate rounds, seed, Series A, pre-seed, and grant rounds. Breaking down the total amount reveals key insights:
- Corporate Rounds: The overwhelming majority of funding of $463 million came from corporate rounds. This significant contribution shows the increasing involvement of established companies in funding startups, particularly in sectors like e-commerce and manufacturing. Corporate investors are playing a pivotal role in providing startups with the financial backing they need to scale quickly, often gaining strategic advantages through these partnerships.
- Seed Funding: Startups at the seed stage received $69.07 million. Seed-stage funding is crucial for the region’s entrepreneurial growth, as it enables startups to develop their products, grow their teams, and bring their ideas to market. The strong focus on seed-stage investments highlights the region’s interest in nurturing early-stage ventures, but the relatively small amounts compared to corporate rounds may indicate a gap in later-stage funding availability.
- Series A: With $19 million raised through Series A rounds, this stage received considerably less attention than seed funding or corporate rounds. Series A funding is vital for startups that are looking to scale beyond their initial stages, but the relatively small amount suggests that many startups are struggling to secure the necessary capital to transition from early-stage to growth-stage companies.
- Pre-Seed and Grant Funding: Pre-seed and grant funding rounds were also present, though in much smaller quantities. Pre-seed funding totaled $10.75 million, aimed at supporting startups in their early development phases. Unspecified series rounds contributed $4 million, while grant funding added $0.31 million, providing much-needed financial aid for innovative and impact-driven projects. While the amounts are modest, these early-stage investments are critical in helping startups gain traction and secure future rounds of funding.
Gender-Based Analysis
The distribution of funding by founder gender reveals an ongoing disparity in the MENA startup ecosystem. Male founders received the overwhelming majority of the funding, securing $85.63 million, which represents 83.03% of the total funding excluding corporate rounds.
This significant gender imbalance underscores the need for greater support and inclusion of women in entrepreneurship within the region.
Startups founded by mixed-gender teams attracted $15 million, accounting for 14.55% of the total funding. While this is a relatively small portion, it does indicate that there is some movement towards more gender-diverse leadership in the startup ecosystem.
In contrast, female-led startups received only $2.5 million, representing a mere 2.42% of the total funding. This stark disparity highlights the challenges faced by female entrepreneurs in securing capital and suggests that targeted initiatives and programs are needed to bridge this gap.
Women-led businesses are clearly underrepresented, and encouraging more gender diversity in leadership roles will be essential for creating a more inclusive and dynamic startup environment in the MENA region.
Funding Amounts by Country
The geographical distribution of funding across the MENA region highlights the concentration of investment in a few key countries, primarily the UAE, Saudi Arabia, and Egypt. These nations dominate the MENA startup ecosystem, both in terms of the number of funded startups and the amount of capital raised.
- The UAE leads the region with $76.87 million in total funding across 17 startups. The country’s dominance can be attributed to its favorable regulatory environment, strong infrastructure, and access to both regional and international investors. The UAE continues to position itself as the premier hub for entrepreneurship in the MENA region.
- Saudi Arabia follows with $13.93 million in funding spread across 7 startups. The Kingdom’s startup ecosystem has been rapidly evolving, thanks in part to initiatives like Vision 2030, which seeks to diversify the economy away from oil and foster innovation in sectors like technology and FinTech.
- Egypt ranks third, raising $7.87 million across 5 startups. Egypt has long been a key player in the MENA startup ecosystem, with a large, young population driving entrepreneurial activity, particularly in sectors like FinTech and e-commerce.
Other countries like Kuwait ($3 million), Tunisia ($1 million), and Bahrain, Jordan, and Morocco (with funding amounts ranging from $0.05M to $0.20M) also secured investments, though in smaller amounts. These countries are beginning to attract more attention from investors, but they remain secondary players in the overall MENA startup ecosystem.
Funding Amounts by Industry
The MENA region’s startup ecosystem is not only diverse but also dynamic, with certain sectors consistently attracting more investment and demonstrating higher growth rates. August 2024 highlighted several key sectors that are leading the way in terms of both funding and the number of startups.
- FinTech: As a cornerstone of the MENA startup ecosystem, the FinTech sector led the funding race with a total of $47.20 million in August 2024. The region’s growing demand for financial services, coupled with a young, tech-savvy population, has made FinTech a focal point for investors. Startups in this sector are primarily focused on digital payments, mobile banking, and financial inclusion initiatives.
- Manufacturing: The manufacturing sector received $15 million in funding, underscoring the region’s push towards industrial diversification and local production. With a focus on integrating new technologies such as automation and IoT, manufacturing startups are poised to play a crucial role in the MENA region’s economic development.
- Information Technology: The IT sector attracted $11.20 million in funding, driven by the increasing need for digital transformation across businesses in the region. Startups in this sector are involved in software development, cloud services, and IT consulting, catering to a broad range of industries looking to modernize their operations.
- Media and Entertainment: This sector secured $10 million in funding, reflecting the rising popularity of digital content platforms, streaming services, and entertainment tech. The MENA region, with its young and culturally diverse population, presents a lucrative market for media startups looking to capitalize on changing consumption habits.
- Business Development and Marketplace Startups: These sectors received $6.6 million and $6 million respectively. The growth in this area is indicative of the region’s shift towards digital marketplaces that facilitate trade, commerce, and business services, providing a crucial infrastructure for other sectors to thrive.
- Artificial Intelligence (AI) garnered $1.62 million, reflecting the region’s growing interest in AI-driven solutions, especially in automation and analytics. Web development received $1.35 million, showing demand for improved digital infrastructure and online services.
- Analytics, banking, and EdTech each raised $1 million, $1 million, and $0.92 million, respectively, highlighting ongoing investments in data-driven decision-making, financial services innovation, and educational technology. The Web3 sector raised $0.5 million, indicating a budding interest in blockchain and decentralized technologies.
- Smaller sectors such as security ($0.25 million), e-commerce ($0.21 million), and foodtech ($0.20 million) also drew attention, as they focus on cybersecurity, online retail, and food technology.
- Transportation and real estate were the smallest sectors, securing $0.05 million and $0.02 million, respectively, illustrating emerging but still nascent efforts in logistics and property tech in the region.
Top Notable Startup & Deals
Top 5 Notable Startup Deals
Several standout startups secured significant investments in August 2024, reflecting both the diversity of industries represented and the substantial capital flowing into the MENA region’s entrepreneurial ecosystem.
1. Yuze Digital (FinTech, UAE) – $30 million
Yuze Digital emerged as the top-funded startup in August 2024. The FinTech company, led by male founders in the UAE, is focused on delivering cutting-edge financial solutions to businesses and consumers.
2. E Daddy (Manufacturing, UAE) – $15 million
E Daddy secured the second-largest deal, reflecting the growing interest in manufacturing startups as economies in the region seek to diversify away from oil dependence.
3. Myco (Media and Entertainment, UAE) – $10 million
Myco raised $10 million in Series A funding, underscoring the growing demand for digital media and entertainment platforms in the MENA region.
4. Resal (FinTech, Saudi Arabia) – $9 million
Saudi-based FinTech company Resal raised $9 million, continuing the trend of strong investor interest in financial technology solutions in the Kingdom.
5. Mealplanet (Marketplace, UAE) – $6 million
Mealplanet, a food and beverage startup, raised $6 million in a seed funding round led by AlTouq Group and other investors.
These deals demonstrate the diversity of sectors attracting investment in the MENA region, with significant deals happening across FinTech, Manufacturing, Media, and Business Development.
Top 3 Corporate Rounds
Corporate rounds were a major source of funding in August 2024, with several large deals underscoring the growing involvement of established companies in the MENA startup landscape.
1. Brands for Less (E-Commerce, UAE) – $360 million
This massive corporate round highlights the strength of the e-commerce sector in the UAE, as more consumers shift to online shopping and businesses capitalize on the growing demand for digital retail solutions.
2. Orbitworks (Manufacturing, UAE) – $100 million
Orbitworks’ $100 million corporate round reflects the increasing interest in manufacturing innovation, particularly in sectors related to industrial production and supply chain management.
3. Kem Technologies (FinTech, Kuwait) – $3 million
FinTech continues to attract significant attention from corporate investors, as illustrated by Kem Technologies’ $3 million corporate round in Kuwait.
Corporate-backed funding provides startups with more than just financial support; it often comes with strategic partnerships, access to resources, and mentorship from established industry leaders.
List of all Funded Startups in August 2024
| S. No. | Startup Name | Industry | Country | Funding Type | USD Funding Amount |
| 1 | Brands for Less | E-Commerce | UAE | Corporate Round | $360,000,000 |
| 2 | Orbitworks | Manufacturing | UAE | Corporate Round | $100,000,000 |
| 3 | Yuze Digital | FinTech | UAE | Seed | $30,000,000 |
| 4 | E Daddy | Manufacturing | UAE | Seed | $15,000,000 |
| 5 | myco | Media and Entertainment | UAE | Series A | $10,000,000 |
| 6 | Resal | FinTech | KSA | Series A | $9,000,000 |
| 7 | Mealplanet | Marketplace | UAE | Seed | $6,000,000 |
| 8 | Kremzein | Business Development | Egypt | Pre-Seed | $6,600,000 (Approx) |
| 9 | Credbull | FinTech | UAE | Seed | $5,200,000 |
| 10 | Blockscout | Information Technology | UAE | Seed | $3,000,000 |
| 11 | Kem App | FinTech | Kuwait | Seed | $3,000,000 |
| 12 | Kem Technologies | FinTech | Kuwait | Corporate Round | $3,000,000 |
| 13 | Verofax Limited | Information Technology | UAE | Unspecified Series | $3,000,000 |
| 14 | Yalla Plus | Information Technology | KSA | Seed | $2,700,000 |
| 15 | Stabble | Information Technology | UAE | Seed | $2,500,000 |
| 16 | Blend | Web Development | KSA | Pre-Seed | $1,350,000 |
| 17 | Qardy | Banking | Egypt | Pre-Seed | $1,000,000 |
| 18 | Wattnow | Analytics | tunisia | Unspecified Series | $1,000,000 |
| 19 | STHRIVE | EdTech | UAE | Pre-Seed | $570,000 |
| 20 | Lisan | AI | UAE | Seed | $570,000 |
| 21 | JobEscape | AI | UAE | Seed | $570,000 |
| 22 | Mithu | Web3 | KSA | Pre-Seed | $500,000 |
| 23 | ResquadAI | AI | KSA | Pre-Seed | $324,000 |
| 24 | Pravica | security | Egypt | GRANT | $250,000 |
| 25 | Mashe Delivery | Foodtech | Jordan | Pre-Seed | $200,000 |
| 26 | Tajweed | EdTech | Bahrain | Seed | $200,000 |
| 27 | Opteam | AI | UAE | Pre-Seed | $153,900 |
| 28 | Qureos | EdTech | UAE | Seed | $153,900 |
| 29 | HeroGo | E-Commerce | UAE | Seed | $153,900 |
| 30 | LIVSHO | E-Commerce | KSA | Grant | $60,750 |
| 31 | DBS GROUP | Transportation | Morocco | Pre-Seed | $50,000 |
| 32 | Amtalek | Real estate | Egypt | SEED | $20,400 |
| 33 | Leading Point | Information Technology | Jordan | Series B | Unspecified |
| 34 | Athir | Information Technology | KSA | Unspecified Series | Unspecified |
| 35 | Tokyo Beast | Gaming | UAE | Angel | Unspecified |
| 36 | NoorNation | Manufacturing | Egypt | Seed | Unspecified |
| 37 | Travilege | Saas | UAE | Angel | Unspecified |
| 38 | Powder Beauty | E-Commerce | UAE | Seed | Unspecified |
| 39 | Emma | transportation | Qatar | EARLY VC | Unspecified |
| 40 | SophiaVerse | Gaming | United Arab Emirates | GRANT | Unspecified |
| 41 | TESS Payments | Fintech | Qatar | EARLY VC | Unspecified |
| 42 | Thakaa Med | Health | KSA | SEED | Unspecified |
| 43 | Travelj | Saas | United Arab Emirates | EARLY VC | Unspecified |
Startup Analysis
Funding rounds in the MENA region showcase a diverse investment landscape. The average deal size across startups varies significantly based on the stage of investment and the industry focus. Notably, early-stage investments, particularly in the seed and Series A rounds, dominate the landscape, with a few high-value deals skewing the average deal size upwards.
The total funding amount of $566 million for MENA startups in August 2024 includes a significant portion from corporate rounds, which account for $463 million of the total. Excluding these larger corporate investments, the funding available to early and growth-stage startups is $103 million.
With 43 startups sharing this amount, the average deal size for non-corporate rounds is recalculated to about $2.4 million, highlighting the typical funding landscape for startups in seed and Series A stages.
The median deal size remains around $1.2 million, reflecting the central tendency of investment sizes that early-stage startups receive, often more modest compared to the few large-scale corporate deals.
Industry Analysis: Hot Sectors, Growth, and Trends
The MENA startup ecosystem is characterized by a diverse array of sectors, each showcasing unique growth patterns and investment levels. FinTech remains the hottest sector, securing a substantial $47.20 million in funding.
The dominance of FinTech highlights the region’s increasing shift towards digital financial solutions, with startups focusing on payments, lending, and financial inclusion. Investors recognize the immense potential of FinTech to disrupt traditional banking systems, offering innovative services to underserved populations and enhancing financial access.
Manufacturing and Information Technology also stand out, attracting $15 million and $11.20 million, respectively. The interest in manufacturing is a reflection of the region’s industrial diversification goals, especially in countries like Saudi Arabia and the UAE, where efforts to modernize production processes are gaining traction. Meanwhile, the demand for tech-driven solutions across industries has fueled growth in Information Technology, making it a critical area for businesses undergoing digital transformation.
Beyond these dominant sectors, industries such as Media and Entertainment, Business Development, and AI are also emerging as promising fields, with $10 million, $6.6 million, and $1.62 million in funding, respectively. This diverse spread of investments demonstrates that the MENA region’s startup ecosystem is expanding across various domains, reflecting investor confidence in the region’s potential for innovation across different industries.
Emerging Industry Trends
The MENA startup ecosystem is being shaped by several emerging trends that are likely to define its future growth. These trends highlight the region’s potential to lead in various technological and innovative domains:
- Digital Transformation: There is an increasing focus on digital transformation across sectors, with startups leveraging technology to disrupt traditional industries. This trend is particularly pronounced in FinTech, IT, and e-commerce.
- Sustainability and Green Technologies: A growing emphasis on sustainability is driving investments in green tech and renewable energy solutions, aligning with global trends towards eco-friendly innovations.
- AI and Automation: Artificial Intelligence (AI) and automation are becoming integral across multiple sectors, from manufacturing to finance, enhancing efficiency and creating new business models.
- HealthTech and EdTech: The health and education sectors are experiencing rapid digitalization, with startups offering innovative solutions in telemedicine, online education, and personalized learning experiences.
Key Challenges and Emerging Opportunities for MENA Startups
Key Challenges
While the MENA startup ecosystem is burgeoning, several challenges could hinder its growth if not addressed:
- Limited Access to Growth-Stage Funding: While early-stage funding is abundant, there is a noticeable gap in Series A and beyond. This shortage restricts the ability of startups to scale operations and expand market reach, often leading to stunted growth. In August 2024, the disparity was evident with only $19 million raised in Series A rounds compared to $463 million in corporate rounds.
- Regulatory Barriers: The MENA region is known for its complex regulatory environment, which can be a significant barrier for startups, especially those in regulated industries like FinTech and HealthTech. Navigating these regulations requires substantial resources and expertise, often deterring foreign investors and slowing down the launch of innovative products.
- Talent Acquisition and Retention: Startups in the MENA region face a significant challenge in attracting and retaining top talent, particularly in high-demand fields such as AI, data science, and cybersecurity. The competition for skilled professionals is fierce, and many startups struggle to offer the competitive salaries and benefits needed to attract these individuals.
- Market Fragmentation: The MENA region is highly fragmented, with each country having its own distinct market characteristics, consumer behaviors, and regulatory environments. Startups need to tailor their offerings to suit different markets, which can be resource-intensive and challenging.
Emerging Opportunities
Despite these challenges, the MENA startup ecosystem is ripe with opportunities that can be leveraged by agile and innovative companies:
- Expansion into Untapped Markets: Countries like Kuwait, Tunisia, and Bahrain offer emerging opportunities with less competition and growing investment interests. Startups targeting these markets can benefit from first-mover advantages.
- Leveraging Government Initiatives: Numerous MENA governments are launching initiatives to support startups, such as funding programs, incubation centers, and regulatory reforms aimed at easing business operations.
- Focus on Tech-Driven Solutions: The rising demand for tech-driven solutions across sectors such as health, finance, and education creates ample opportunities for startups to innovate and address market needs.
- Cross-Border Collaboration: Startups that engage in cross-border collaborations within the MENA region can tap into larger markets, shared resources, and diverse talent pools, enhancing their growth potential.
Closing Remarks
Thank you for reading the MENA Startup Funding Report – August 2024, published by Rasmal Inc. We trust this report has provided valuable insights into the current state of the MENA startup ecosystem, covering key funding trends, challenges, and opportunities.
At Rasmal, we are dedicated to delivering the latest, data-driven intelligence on startups and venture capital across the MENA region. By sharing these insights, we aim to support the growth and success of the regional startup ecosystem and encourage informed decision-making for founders, investors, and stakeholders.
Disclaimer
The information in this report has been sourced from publicly available data and proprietary research conducted by Rasmal Intelligence, a division of Rasmal Inc. While every effort has been made to ensure the accuracy and reliability of the information provided, Rasmal Inc. does not guarantee the completeness, timeliness, or accuracy of the data. This report is for informational purposes only and should not be considered financial or business advice.
Rasmal Inc. disclaims any liability arising from decisions made based on the content of this report. The use of any third-party trademarks, service marks, or logos in this report does not imply an endorsement by Rasmal Inc.
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