Comparatively, in the first three quarters of 2022, MENA startups amassed $2.7 billion, with debt financing comprising $455.7 million of that sum.
In a display of commendable resilience, startups across the Middle East and North Africa (MENA) region have secured $36 million in funding despite facing a challenging investment landscape in September.
This figure, although reflecting a 64 percent month-on-month decline, underscores the determination of these ventures. The year-to-date investment totals $1.8 billion, with $687 million sourced from debt financing.
Comparatively, in the first three quarters of 2022, MENA startups amassed $2.7 billion, with debt financing comprising $455.7 million of that sum. The dwindling funding landscape is evident in declining deal counts and shrinking cheque sizes, impacting the entire region.
The UAE emerged as a prominent player in September, largely due to substantial investments in Fuze and Zero Carbon Ventures, raising $14 million and $5 million respectively. These significant deals propelled the UAE to the forefront in the region, with startups collecting $27 million over 14 deals. Following closely, Saudi Arabia secured $2.7 million across seven transactions, while Egypt, in third place, saw six of its startups accumulate $2.6 million.
Fintech remains a favored sector, registering six deals worth over $16 million, closely followed by clean technology and gaming.
In terms of business models, business-to-business startups attracted over $25 million in investments, while their business-to-consumer counterparts secured slightly over $10 million. The number of deals was evenly distributed between the two models.
However, a gender-based analysis revealed that female-founded startups could only secure $320,000 during the month, primarily in grants. In contrast, startups with mixed-gender founding teams managed $1.65 million over four deals, while those exclusively founded by men dominated with $34 million across 21 deals.
In an instrumental move for Saudi Arabia’s technology sector, Egyptian deep tech firm Intella secured $3.4 million in a pre-series A funding round. This funding, led by Saudi-based HALA Ventures and Wa’ed Ventures, the venture arm of Aramco, is set to accelerate Intella’s expansion into the Saudi market, focusing on the development of AI models tailored for the Middle East and North Africa audience.
Saudi shipping and logistics startup RedBox also achieved a significant milestone by concluding a Series A funding round, amassing SR26.25 million ($7 million). Spearheaded by Saudi-based food delivery company Jahez, the investment is set to bolster RedBox’s smart shipping lockers, expanding its network across more than 50 Saudi cities.
Jordanian fintech startup Capifly has secured $1 million in a pre-seed funding round, drawing interest from prominent investors like Oasis500, BLDR Ventures, Joa Capital, and Ahli Fintech, as well as angel investors from Jordan and Saudi Arabia. Capifly, established in 2022, offers non-dilutive, Shariah-compliant venture debt tailored for startups, marking a significant stride in the fintech sector.
This recent funding positions Capifly at the forefront of the digital economy’s growth, with plans to underwrite debt for other financial institutions, solidifying its key role in the digital era. Additionally, Capifly has entered the Saudi market, further strengthening its regional presence.
In a region marked by challenges, these startups are showcasing remarkable tenacity, signaling a promising future for innovation and entrepreneurship in the MENA region.