Year In Review: MENA Startups Struggle Despite Strong Headline Figures

Despite positive headlines, last year wasn’t a good one for MENA startups seeking funding

-  MUHAMMAD ADDAM

The headlines might paint a rosy picture of growth in MENA's startup scene, which secured $4 billion in funding throughout 2023, marking a modest 1.7% year-onyear increase, according to a recent Wamda report. However, nearly half of that figure, or $1.8 billion, came from debt, which surged 257%. Stripping away this borrowed cash, we see a 35% plunge in actual investment compared to 2022, dropping the true figure to $2.25 billion.

Deal activity across the region mirrored the funding trend, declining 27% in 2023. This downturn affected all markets, with Egypt experiencing the most significant drop, witnessing a 50% reduction in the number of completed transactions compared to the previous year.

However, bright spots emerged in Saudi Arabia, Morocco, and Oman as they bucked the trend and saw a notable increase in investment for the year.

Saudi Arabia, the U.A.E., and Egypt continue to dominate the landscape, with a combined 98% of all investments and 75.6% of all transactions in the region last year. Here's a peek at their performances.

Investments by country

Saudi Arabia 

Investment: $2.3 billion (Up 159%)