MENA startups raise USD105 million in July, the lowest amount in 2022

MENA startups raised USD 105 million in July, the lowest monthly amount registered this year, according to Wamda.

MENA startups raised USD 105 million in July, the lowest monthly amount recorded so far this year, according to regional startup investor and development platform Wamda.

MENA startups: Investment slows

MENA region startups raised USD 105 million through 44 deals last month, according to a recent report by Wamda. This marks a significant slowdown in investments. July’s results represent an 84% drop year-on-year and a 68% drop month-on-month. Even if Kitopi’s USD 415 million Series C round of July last year is omitted, July’s results still represent a drop of over 50%.

The number of deals fell by almost a third when compared to June, and have halved compared to figures from July 2021. While investment announcements tend to slow during the summer months, this trend is also part of a general global slowdown.

Fintech leads MENA startups

The largest contributing sector continues to be fintech and includes UAE-based Yap’s USD 41 million growth round. The Yap deal accounts for 50% of the investment total in the UAE alone. Yap’s large round propelled fintech to the top of the rankings in terms of investment value with USD 53 million raised across eight deals. 

Country trends

While Saudi Arabia’s startup investment has been steadily increasing, July saw a 55% drop in values when compared to the previous month. UAE startups recorded a drop of 73%.

Egypt was the only state to see its investment level rise, with a 72% increase in investment, thanks largely to payment and finance startup Cartona’s USD 12 million Series A round.

Lebanon saw an increase in activity, largely thanks to the Energy Innovation Hub’s accelerator, which gave 13 startups a USD 12,000 grant, largely in the cleantech and sustainability sectors.

Low levels of FDI

The overall slowdown is mirrored by lower levels of FDI, with just 12 startups attracting foreign investment. US investors participated in eight deals. Lebanon’s Innovation Hub was the most active investor in terms of the number of deals, with UAE investors being involved in 11 deals and Saudi investors participating in eight deals.

Female-founded startups

Female-founded startups raised just 0.1% of the total investment value, the lowest amount this year. Startups founded by men raised USD 95 million, just under 91% of the total. Startups founded by a team of male and female co-founders raised USD 9.6 million, representing 9% of the total.