Khaled Al Khawaldeh (Abu Dhabi)
The UAE startup market has remained the most active in the Middle East and North Africa (MENA) region, accounting for 38% of all new deals in the first 3 quarters of 2024 according to a new report from VC analytics firm, MAGNiTT.
The Q3 2024 Venture Investment Report found that the UAE’s startup market had seen a 12% year-on-year increase in total deal volume despite a slightly slower year for the region overall.
According to MAGNiTT the region’s startups raised $1.316 billion, a decrease of 13% year-on-year. However, it found that only $288 million of this came from mega deals including Saudi Arabian E-commerce platform, Salla’s $130 million raise and Hallan’s $157.5 million round in Egypt.
The report said that excluding these “mega deals” there had been a 7% year-on-year increase which indicated there was increasing confidence in early-stage startups in the region. This was supported by the fact that 61% of “non-mega” had come from a series A and seed funding deals.
Overall, the region had also seen a major rebound in funding in Q2 and Q3, which indicated strong growth despite the overall slowdown in deal activity year-on-year. With 48% and 54% year-on-year growth in these quarters, that the report said was partially propelled by mega-deals.
Fintech remained the dominant sector, capturing 37% of total funding, while e-commerce and retail saw declines. According to the report, this funding came from increasingly varied sources, with the number of unique investors rising 34% year-on-year. Notably, international investors made up the majority in the region for the first time in more than five years, accounting for 51% of all investors.