MENA’s business landscape is transforming as women entrepreneurs make a space for themselves and emerge as a force to be reckoned with in traditionally male-dominated fields.

From lack of funding to societal barriers, many factors have hindered the success of female entrepreneurs in the region. However, a notable shift is underway, as the rise of digital technology, growing supportive networks, and new initiatives facilitate women’s ability to grow and market their businesses independently.

GROWING OPPORTUNITIES

A report from First Abu Dhabi Bank (FAB) and WealthBriefing attributes the rise of women’s wealth across the region to the rise of digital channels, which empower women with greater access to information, diverse cultural perspectives, and participation opportunities within the workforce and financial systems.

Nadine Mezher, co-founder of Sarwa, cites digital transformation and globalization as the primary reasons for growing opportunities for women entrepreneurs, especially in the tech industry. “Leveraging technology offers new avenues to launch and scale businesses online, in a more accessible way than ever with potential cross-border collaboration and even access to global markets.”

Mezher also notes an expansion in networking communities, which have proven invaluable for women. “This provides great opportunities for women to connect, share experiences, and collaborate. It creates a support system that is much needed.” 

Dana Malaeb, co-founder of Hub71 startup, Lemonade Fashion, also highlights the role of digital technology in democratizing access to critical business resources, including mentorship, funding, and markets, thereby significantly enhancing the capacity for women to launch and scale their ventures. 

“Online tools and social media platforms have become instrumental for women entrepreneurs in business development, e-commerce, and networking. This digital revolution allows for greater visibility and reach for women-led businesses and facilitates connections with mentors, peers, and potential investors, thereby fostering a supportive ecosystem for female entrepreneurship.”

A study published in Cross Cultural & Strategic Management, conducted in Turkey and four MENA countries (Lebanon, Saudi Arabia, Morocco, and Egypt), highlighted networking as the critical factor enabling women entrepreneurs to surmount challenges like accessing capital or identifying new market opportunities.

Discussing the surge in female entrepreneurship-focused initiatives across the region, Noor Sweid, Managing Partner at Global Ventures, cites examples like the global advocacy program She’s Next, supported by Visa. This initiative aims to economically empower women entrepreneurs in the UAE, Saudi Arabia, Egypt, and Morocco through networking, mentoring, and funding opportunities. Additionally, the UAE has established the Gender Balance Council, focusing on enhancing female representation on company boards, including startups.

Sweid emphasizes the significance of increased female workforce participation, citing projections by the World Economic Forum that suggest it could add $2.7 trillion to the region’s economy by 2025. ”The growing trend of female entrepreneurship will increase job creation and expand workforce opportunities. Therefore, we must continue to support and invest in diversified portfolio companies.”

Malaeb adds that establishing initiatives and programs specifically designed to support women entrepreneurs, such as accelerators, incubators, and gender-focused investment funds, indicates a positive trend toward eliminating traditional barriers.

Talking of the transformation she’s witnessed in her own sector, Ambareen Musa, CEO of Yabi, formerly Souqalmal, says female entrepreneurs were non-existent in fintech when she first started.

She attributes this transformation partially to the rise of VCS, which has carved out funding for women founders, many more structures of women’s working spaces, and many more female awards that have popped up, creating a lot of support for women. More and more female-led VCs have now been founded in the region, and women mentorship programs like the Female Factor are looking at entering the region, too.

A growing number of investment funds specifically look to back startups with at least one female co-founder. “It’s not just the investors; accelerators and mentors are also rallying behind women-led ventures, recognizing the unique perspectives and value they bring,” says Torkia Mahloul, co-founder and COO of OvaSave.

LACK OF FUNDING

Despite this progress, women-led businesses in the region still constitute a minority, with less than 5% of businesses being led by women, compared to a global average of up to 26%.

According to a report by the International Labor Office, acquiring capital remains a significant challenge for women. Most female entrepreneurs in the MENA region do not pursue formal funding sources and instead rely on personal savings or familial support. For those who do seek investment, they encounter unique hurdles. 

Research by Wamda and TiE Dubai notes that 66% of women founders in MENA feel that investors exhibit less interest in funding startups led by women. This apprehension is substantiated by the fact that female-only startups received less than $50 million in investments during the first nine months of 2022, constituting approximately 2% of total startup investment in the region.

Sweid says eight out of ten women business owners are still tapping into their personal savings. For women-led businesses, there tends to be a decrease in allocated capital as they progress through their funding lifecycle. This often makes it challenging to secure funding at later stages or effectively scale up. In 2021, 61% of total funding received by startups with female founders was allocated at the seed and early stages, highlighting a shortage of funding opportunities at later stages of growth.

“We must focus on creating an inclusive ecosystem where funding is readily available for women. There are a greater number of women on investment committees across MENA, which is providing investors a broader, more inclusive, and diverse viewpoint on businesses to invest in,” Sweid adds.

Mezher attributes this significant funding gap to several factors, including conscious and unconscious bias, dealing with suppliers, and other stakeholders. “Beyond access to capital, women even face a lack of access to collateral against debt due to legal or societal norms.”

Stressing the need for greater representation and support in male-dominated industries, Mahloul says, “Women entrepreneurs often face barriers when trying to enter sectors traditionally dominated by men, such as technology and finance. Breaking through these barriers requires determination and systemic changes to promote gender diversity and inclusion.”

But things are changing. Women’s participation in the private sector increased by 23.1% in 2023 compared to 2022. Additionally, several major companies in the UAE have committed to ensuring that women hold 30% of leadership positions by 2025, thereby fostering greater gender equality and opportunities. 

“By having more women in investment decision-making positions, the gender bias will be rebalanced within the venture capital and startup ecosystem and boost female entrepreneurship,” says Sweid.

Mezher says progress is not linear or equal across the region. “While we are making progress, it’s important to note that the pace of change varies widely across different countries and communities within the MENA. Unfortunately, we can not throw a blanket over the entire region. But I think there is a broader shift towards encouraging women pursuing entrepreneurship, with the UAE leading the charge.”

This shift is driven by several variables, including increased visibility as women assume more entrepreneurial roles, heightened awareness and education regarding gender equality and women’s empowerment, and growing recognition of women’s contributions to economic growth.

CULTURAL SETBACKS

Cultural expectations also pose major setbacks for women. Female entrepreneurs are still pressured to prioritize family responsibilities over demanding careers, leading to the region having the lowest female labor force participation rate worldwide, standing at half the global average of 24.6%.

Nuha Hashem, Co-founder of Zywa, says one of the biggest hurdles she’s faced is overcoming cultural biases that “often undermine women’s credibility and capabilities as business and tech leaders.”

“Balancing the demands of entrepreneurship with societal expectations of women’s roles can be daunting at times, and battles must be fought every day.”

Social norms pose a great challenge for women. “women face many gaps, with the career gap being the most accentuated,” says Mezher. “Women face skepticism about their abilities to lead business when balancing family responsibilities.”

Cultural expectations and stereotypes also seep into what’s expected of female entrepreneurs in their line of work. “In the past, the idea was that women entrepreneurs were mostly confined to certain industries like beauty or fashion. But that’s changing rapidly,” says Mahloul.” 

These perceptions are already undergoing a noticeable shift. Another significant change is the growing acceptance that women can balance entrepreneurship with family life. In the past, there was this notion that women had to choose between being dedicated wives and mothers or pursuing a career. “But that binary thinking is becoming outdated. Women are proving that they can excel in both realms,” adds Mahloul.

Traditional societal roles have gradually diminished as societies transition to knowledge-based economies. In the MENA region, 57% of STEM graduates are women. 

Ultimately, women’s self-perception is key to fighting these expectations and pressures. “I do believe it is about how a woman sees herself. Only when you as a person accept that you are an entrepreneur vs. being a woman will everyone around you accept you for who you believe you are,” says Musa.

THE FUTURE OF FEMALE ENTREPRENEURSHIP 

All agree that the future of women’s entrepreneurship over the next decade looks promising due to a rise in participation. 

Many women engage in diverse sectors such as fintech, agtech, renewable energy, and logistics, expanding beyond conventional e-commerce and retail domains. These trends will persist in the future.

The government and the private sector also level the playing field for women. “As more women’s success stories emerge from the region, perceptions will continue to change, and inclusion will be greater. In entrepreneurship, any challenge can be turned into an opportunity, and this is one we can definitely tackle,” Mezher adds.

Mahloul predicts a surge in female leadership across the entire entrepreneurial ecosystem. From more female angel investors and venture capital funds led by women to increased representation in government bodies and accelerators, “women will play key roles in supporting and nurturing the growth of female-led ventures.”

Sweid is equally as optimistic. “We’ll see continued increases in women acting as mentors and innovators across MENA, as greater financial and mentoring support is provided from the private and public sectors. The share of women in professional and technical jobs is set to more than double by 2030 through digitization, online platforms, and entrepreneurship.”

Hashem believes that by sharing authentic narratives, challenging stereotypes, and advocating for policy shifts, we can foster a more nurturing environment where women excel as business leaders and innovators. “In the next decade, I anticipate a significant increase in women-led startups making waves in diverse industries, driving economic growth, and inspiring positive change in our communities.”