- In April 2024, MENA startups raise $55 million, a 78% drop from March but an 87% increase from 2023.
- UAE’s Fortis led funding with $20 million in Series A, while Saudi Arabia saw a decrease in investments.
- The fintech sector dominated funding with $25.7 million and was followed by e-commerce and AI.
- The majority of the investments favoured later-stage startups, with B2B ventures receiving $42.5 million.
- Female-founded firms received significantly lower funding as compared to male counterparts.
As per the report by Wamda in collaboration with Digital Digest, only 19 startups in the Middle East and North Africa (MENA) region raised $55 million in investments during April 2024. This amount shows a decrease of 78% from the $254 million raised in March. But this amount reflects an 87% increase when compared to the same period last year i.e. 2023.
The ecosystem continues to suffer from the downturn experienced in the first quarter, with most venture capital (VC) companies maintaining a cautious approach.
Last month the largest investment was received by Fortis i.e. a UAE-based fintech company. It secured $20 million in Series A funding. This was followed by WEE which raised $10 million in a pre-Series A round, and Qodek from Tunisia, which received $8 million in Series B funding.
A notable trend observed last month was the decrease in investment in Saudi Arabia. Only three Saudi startups were able to secure $4.8 million in funding. Meanwhile, UAE-based businesses received $32 million across six deals, and Egyptian startups raised $8.7 million through five deals.
Fintech was the most funded sector in April. Altogether, four firms raised a total of $25.7 million, among which Fortis received $20 million of that amount.
Additionally, the e-commerce sector received $10.5 million in funding across two rounds, whereas an AI startup i.e. Qodek, raised $8 million. Three SaaS providers together received $3.5 million in investment.
The majority of investment went to later-stage startups last month. Fortis claimed $20 million in its Series A round, while pre-Series A startups attracted $14.3 million, and $8 million went to Series B companies.
Investors continue to show a strong appetite for business-to-business (B2B) ventures, with $42.5 million being invested across 12 transactions. B2B2C received $11 million in funding, whereas business-to-consumer (B2C) models secured $1.2 million.
In April, funding for female-founded firms was significantly lower. Only one female-founded firm secured $100,000 in funding, while male founders received $43 million. The remainder went to companies co-founded by males and females.
The movement within the Ecosystem
The Egyptian and Saudi ecosystems came together last month and offered ten Egyptian companies the opportunity to explore the Saudi market and expand into the Kingdom under the joint Saudi-Egyptian programme VMS Bridge.
Several venture capital firms also launched funds in April. Such as Abu Dhabi’s ADQ collaborated with the Oman Investment Authority (OIA) to launch the Jasoor Fund i.e. a $180 million technology-focused fund. Verod-Kepple Africa Ventures (VKAV) i.e. a Nigeria-based venture capital firm also completed a $60 million final close for its pan-African VC fund.
Whereas in terms of mergers and acquisitions (M&A), Bahrain-based alternative asset manager Investcorp made a $120 million acquisition of NSEIT. NSEIT is the digital technology division of India’s National Stock Exchange (NSE).
April also witnessed US tech giant Microsoft expressing interest in a regional AI player, G42. Microsoft invested $1.5 billion for a minority stake with the aim of delivering advanced AI solutions with Microsoft Azure across various industries and markets.
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