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Monday, 22 February 2021

MENA startups break records in 2020 with 256 active investors

A record number of venture capital investors provided finance to MENA-based startups last year, despite the disruption caused by the covid-19 pandemic, according to Magnitt’s 2021 MENA Investor Ranking Report (pdf). Last year saw 256 active investors provide capital to startups in the region, up 19% from 2019, the report said.

In detail: UAE hosted in 2020 about 22% of active investment companies in MENA, followed by Saudi Arabia with a 19% share. The most active MENA-focused investor in 2020 was 500 Startups which is backed by the Bahrain-based 500 Falcons fund, taking part in 42 agreements across various industries in the region.

Fintech was a favorite in 2020: Fintech saw the biggest uptick in demand as a result of the pandemic, with 63 VCs investing in mobile and online payment solutions.

Accelerators decelerated: Accelerators comprised only 10% of investors in the region last year, down 28% from 2019.

Corona didn’t disrupt MENA VC flows last year: Venture capital inflows into MENA startups climbed to USD 1 bn in 2020, up from USD 700 mn the year before, despite the economic damage and market volatility caused by the pandemic, the startup data platform said in January. Egypt held the second-biggest share of venture capital investment, falling behind the UAE, which accounted for a whopping 56% of the total funding amount last year, Magnitt said.

Egypt accounted for almost a quarter (24%) of the region’s venture capital transactions, coming just short of the UAE’s 26% and ahead of third-placed Saudi Arabia at 18%.

What does the Enterprise Startup Tracker™ have to say? Our math says nearly 50% more transactions were closed in Egypt last year and that the average transaction was worth about 2x in 2020 it was the year before. Fintech and e-commerce accounted for almost half the 49 transactions we picked up last year. Tap or click here to read our 2020 Review: The year in startups.

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