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UAE dominates MENA startup funding with $47 million in January

UAE’s startup funding represents more than half of the total raised across 33 deals in the region

UAE dominates MENA startup funding with $47 million in January
[Source photo: Anvita Gupta/Fast Company Middle East]

While January traditionally marks a sluggish period for fundraising in the Middle East and North Africa (MENA) region, UAE startups defied expectations by securing a dominant $47 million in investments, according to Wamda and Digital Digest.

This impressive figure represents more than half (54%) of the total $86.5 million raised across 33 regional deals, reflecting a 34% decline year-on-year.

Despite the overall slowdown, several countries saw notable activity. Egypt followed closely behind the UAE with $23 million in investments, showcasing its growing entrepreneurial ecosystem. 

Saudi Arabia, Qatar, and Morocco attracted investor attention, securing $10.7 million, $2 million, and $1.4 million, respectively. Notably, Iraq and Oman emerged with $1 million and $500,000, while Lebanon and Tunisia each raised $100,000.

This can be considered a rebound from 2023’s numbers. Startup funding in the MENA region experienced a decline in all but three countries. Although the total amount raised slightly increased to $4 billion 2023 across 583 transactions, this figure includes $1.77 billion in debt financing from 10 deals.

Most countries in the region faced challenges, with Egypt witnessing a significant decrease in the number of transactions, halving to 90, and investment dropping by 17% compared to 2022. Additionally, debt-free investment decreased by almost 40%. 

Notably, UAE-based startups saw a notable decline in fundraising, with a 47% decrease, including debt, and a 65% drop in debt-free investment.

While the regional dip in funding shouldn’t raise undue concerns, the UAE’s strong performance in January is a positive sign for the future of tech innovation in the MENA region.

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