MENA Startup Funding Soars 202% to $454.7M in May

MENA Startup Funding Rockets in May

Startup funding in the Middle East and North Africa (MENA) region saw a substantial surge in May, totaling $454.7 million across 33 deals. This marks a 202 percent increase from the previous month and a 76 percent rise year-on-year, signaling a recovery in funding activity.

• Debt financing was the primary driver, accounting for 66 percent of the total capital raised.
• Even excluding debt deals, investor activity improved compared to April.

Key Trends and Regional Leaders

Despite the capital increase, the number of deals fell by 57 percent year-on-year, indicating a more selective investment landscape. Investors are prioritizing larger transactions and later-stage companies amid ongoing uncertainties.

• The UAE led, attracting $379 million across 15 deals, heavily bolstered by Trukker’s $300 million debt financing.
• Saudi Arabia ranked second with $70 million across 11 deals.
• Egypt secured $5 million across three startups.

Sector Performance and Investment Focus

Logistics dominated funding value, largely due to Trukker’s financing. Fintech followed with significant investment, highlighting key areas of growth.

• Logistics led with $300 million in funding value.
• Fintech followed, securing $105.7 million across five deals.
• Human resources tech received $17.5 million through two transactions.
• Software-as-a-Service was the most active by deal count, recording seven transactions worth $1.8 million.
• Debt financing accounted for $300.5 million across two transactions, with later-stage startups also gaining significant interest.
• Early-stage companies raised $52.2 million across 21 deals, and B2B startups continued to attract the majority of capital.

Notable Deals and Acquisitions

Several individual investment activities shaped the month’s funding landscape, showcasing diverse growth areas across the region.

• Saudi Venture Capital invested in Khwarizmi Venture Capital Fund 2, targeting high-growth tech startups across the GCC.
• UAE-based Algebra AI launched after raising $7 million for AI-powered workflows.
• Gifting platform Zuvees (UAE) secured $1.6 million to enhance AI and expand globally.
• Egyptian fintech MNT-Halan reached a $1.4 billion valuation after a new investment round.
• Iraqi startups Mabiati and Al Jabal Agriculture received six-figure investments.
• Edafa Venture acquired AI startups Kuadra and IRRI Vision.
• Egyptian fintech Blnk raised $37.1 million in equity and debt to expand point-of-sale financing.