Startups in the Middle East and North Africa region raised $1.3 billion in funding in the first nine months of 2024, marking a 13% decline from the same period last year, a recent report by MAGNiTT, the leading venture capital data platform has revealed. The report analyzed trends in investment across emerging venture markets, consisting of MENA, Africa, Southeast Asia, Pakistan, and Turkey. 

While venture capital activity globally has been down, MENA has emerged as one of the most resilient among emerging markets. According to MAGNiTT Chief Executive Philip Bahoshy, “We are seeing more interest in MENA from global investors, especially in early-stage ventures.” He says there has been a 34 percent year-on-year increase in the number of investors and 69 percent in foreign investors. 

For instance, the fourth quarter is normally robust for startups in MENA, with juggernaut events like Expand North Star and the Future Investment Initiative Forum in the pipeline. 

More broadly, venture markets declined across the board, raising $4.9 billion or 45% year-over-year. Total deal counts declined by 29% and total exits fell by 39%. Singapore led the way as the country with the largest venture market, at $1.64 billion in both dollars and transactions, with 178 deals. 

In the MENA region, startups raised funding through 352 deals, which increased modestly by 6% in terms of numbers of deals. Fintech appears to be the leading sector, securing $480 million through 72 deals. Funding into Saudi Arabia secured the lion’s share – $509 million – while $380 million came from the UAE. 

More deals were recorded in countries like the UAE, Saudi Arabia, and Egypt. The number of deals in MENA region was accounted for by 38% at the UAE as seed and pre-series A rounds increased by 40%. deal count in Saudi Arabia came up by 7%, most of them seed funded. Egypt’s deal count was marked by an increase of 45% in the number of seed and series A rounds. 

Looking forward, Bahoshy said the fourth quarter may be critical, more so in the light of trends that are being witnessed and which are likely to be low in interest rates and high in investment activities. “All eyes are on whether we can really beat last year’s performance,” he commented.