MENA startups raise USD 176 million in May

MENA startups raised USD 176 million across 42 deals in May, a decline of 40% month-on-month, but a 62.7% rise year-on-year.

According to startup and investment platform Wamda, MENA region startups raised USD 176 million across 42 deals in May. This represents a month-on-month decline of 40%, but a year-on-year increase of 62.7% and a 31% increase in the number of deals when compared to the previous month.

Early-stage investments proving popular

Investors appear to be making smaller deals, as deal volume and values for later-stage startups saw a significant decline. However, early-stage startups saw the largest number of deals (21) in the pre-Seed and Seed stages, raising USD 50 million and accounting for 28% of the total raised.

Leading sectors

B2B software startups accounted for USD 117 million across 24 deals, with fintech capturing USD 112 million.

The B2C sector drew in USD 57 million across 17 deals, with marketplaces attracting USD 24 million and logistics accounting for USD 15 million.

Foreign investment in MENA startups

In May, foreign investors took part in 21 funding rounds, US-based investors participated in 9 deals.

Locally, UAE-based investors were the most active, taking part in 7 deals. Sudan’s 249 Startups was the active incubator, investing in 7 startups.

Gender divides

All-male founded startups attracted USD 154 million through 25 deals, while startups with mixed-gender founding teams raised USD 22 million in 4 deals.

Female-led startups raised USD 64,000. The majority of these investments involved solo female founders emerging from 249 Startups.

Leading deal values and volumes

Egypt-based startups accounted for the largest deal value and volume, accounting for USD 81 million across 11 deals. The largest deal was Paymob’s raising for USD 50 million in a Series B round. The value of Egyptian investment rounds rose by 135% year-on-year, according to Wamda.

Saudi Arabian startups accounted for USD 45 million raised across nine deals. The largest deal was Hyperpay’s USD 36.7 million round led by Mastercard.

UAE-based startups raised USD 45 million across 8 deals.

The Hyperpay and Paymob deals accounted for almost half of the total investment in regional startups in May.

In April, MENA region startups raised USD 297 million. Saudi Arabia, the UAE and Egypt were the largest markets, smaller deals accounted for the majority of investments. Across the region, fintech and B2B and B2C software providers were the largest areas of investment.