
The MENA Startup Ecosystem In 2024 Secures $2.3 Billion Despite Funding Declines
- Business
- February 3, 2025
According to WAMDA Research Lab, the Middle East and North Africa (MENA) startup ecosystem raised $2.3 billion in 2024, a 42% decrease in funding from the year before. Nonetheless, investor interest held strong, as evidenced by the 3.5% increase in acquisitions to 610, which shows that the region’s entrepreneurial scene continues to inspire confidence.
Regional Investments Are Led by the UAE, Saudi Arabia, and Egypt
The UAE continued to dominate, obtaining $1.1 billion across 207 businesses in spite of the overall decline in funding. Egypt brought in $334 million with 84 purchases, while Saudi Arabia came in second with $700 million in 186 transactions. With the majority of investment inflows coming from these three countries, they remained the main drivers of startup growth in MENA.
Funding was dominated by Gulf Cooperation Council (GCC) nations, with Oman exhibiting impressive development, moving up from 10th rank in 2023 to 4th in 2024 after raising $41.5 million through 12 projects. Following with $29 million and $22 million, respectively, were Bahrain and Kuwait. Moderate development was also observed in North African countries, with Tunisia raising $13.1 million and Morocco obtaining $20.8 million. Long-term economic potential was indicated by the consistent expansion of emerging markets like Jordan, Qatar, and Lebanon.
Important Industries: Proptech, Web 3.0, and Fintech
The top-performing industries in the United Arab Emirates were fintech, Web 3.0, and proptech. With $265 million raised through 47 deals, fintech dominated the investment scene, while Web 3.0 businesses raised $255 million through 19 transactions, indicating the nation’s growing interest in decentralized and blockchain technology. With 13 deals totaling $197 million, Proptech came in second, underscoring the ongoing digitization of real estate services.
Fintech continued to be the most well-funded industry in the MENA area, receiving $700 million, or 30% of all startup investments. SaaS funding surged in Saudi Arabia, indicating a growing demand for corporate software solutions, while fintech dominated in Egypt and the United Arab Emirates.
Startups in their early stages obtain a significant portion of funding
Over $1.2 billion went to organizations from pre-seed to Series A rounds, with a large amount of capital going to early-stage entrepreneurs. In contrast, ten Series B and C investments totaling $332 million were made by later-stage businesses. There was a lack of pre-IPO fundraising, as only two businesses raised $143.3 million.
Startups formed by women made only limited headway, raising $27.6 million, or 1.2% of all investments. Despite fewer deals, mixed-gender co-founded enterprises brought in $192 million, indicating the need for more funding for female-led businesses.
Final Thoughts
Even if the startup ecosystem in MENA has financial difficulties in 2024, the region appears to be a potential center for innovation based on the consistent rise in deal activity and sectoral expansion. The entrepreneurial landscape in MENA is constantly changing, with finance at the forefront and new industries like Web 3.0 and SaaS gaining traction. This is supported by significant investor interest in early-stage enterprises.