As summer cools off, so too has the startup scene in the Middle East and North Africa (MENA). The amount invested in startups in August 2024 reached $83 million across 30 rounds, a 76% month-on-month (MoM) decrease from July’s $355 million, and a 24% year-on-year (YoY) decline.

No megadeals were recorded last month, as the biggest size was allocated for Yuze’s $30 million deal. However, debt financing accounted for only about 3% of total investment raised in August.

The UAE makes it to the top again

The majority of investment in August went to UAE-based startups, as 13 of them raised $55.7 million, Saudi startups secured the second spot with $16 million raised over nine deals.

Egyptian startups, after being at the forefront of the MENA investment in July, witnessed a dramatic decline in August, raising only $7.6 million across four deals.

Kuwait also made it to the top four in August, thanks to a single deal in which Kem garnered $3 million.

It’s still bright on the fintech front

Investor appetite remains positive towards fintech, which, for the third consecutive month, has maintained its position as the most funded sector in MENA, raising $54 million stretched over eight deals. Meanwhile, Web3 restored its attractiveness in August, rising to second place with $13.5 million earmarked for three rounds. Foodtech, which was missing from last month's sectoral map, came in third with $9 million raised by four startups.

August, like July, lacked later-stage rounds, as most of August’s investment went to early-stage startups. However, two startups managed to raise $19 million for their Series A rounds. The seed stage followed with five startups pocketing $15.6 million. Notably, a big chunk of investment went to undisclosed stages, as seven startups refrained from revealing which stage they were in, leaving $35.4 million unassigned for a specific stage.

The business-to-business (B2B) model continues  to appeal to investors, with 13 startups raising $46 million, while business-to-consumer (B2C) garnered $15 million over five rounds, with the remainder going to startups operating in both domains.

The investment in female-led startups continues to decline, comprising a mere 0.3% of the total investment. A single female-founded startup, Powder Beauty, managed to raise an undisclosed pre-Series A round last month, while another startup with a female co-founder onboard was awarded a $150,000 accelerator grant. Meanwhile, the rest of the money went to male-founded startups.

August’s highlights

The MENA entrepreneurial ecosystem witnessed vibrant activities in August; one of them was the emerging coalition of GCC-based family offices to launch the “Waad Investment" firm with a targeted value of $200 million. Another $100 million fund was launched in collaboration between the Singapore-based Gate Ventures and the Blockchain Centre in Abu Dhabi to drive Web3 innovation in the coming years. In Egypt, T-Vencubator has launched its inaugural initiative, "Where's the Problem?" to back the Egyptian ecosystem.

In the mergers and acquisitions (M&A) domain, August witnessed the multimillion-dollar acquisition deal of the UAE-based property crowdfunding platform Maisour by Meteora Developers. Meanwhile, Kuwait-based proptech Sakan acquired the Qatari company Hapondo.

Last month, Entlaq, in collaboration with Wamda, released its biannual report on the Egyptian entrepreneurship sector for the first half of 2024, highlighting the challenges and opportunities faced by the entrepreneurial sector in Egypt. You can find it here.

These monthly reports are a collaboration between Wamda and Digital Digest.