Egypt’s venture capital remains most active in MENA region

Egypt remains the most active venture capital market in the Middle East and North Africa (MENA) region during the first half (H1) of 2020, MAGNiTT, MENA’s most comprehensive startup data platform, has announced.

According to MAGNiTT’s H1 2020 MENA Venture Investment Report, Egypt accounts for the largest number of deals in MENA (25%), the country’s same share in the full 2019 data.

The total number of deals in MENA increased by 2% during H1 of 2020 compared to the same period in 2019.

The UAE regained its first place in terms of number of deals, having lost it to Egypt in 2019 after its share decreased by 3%. It now stands equal to Egypt with 25% share. Saudi Arabia came in second with a share of 18%, followed by Oman by 12%, and Jordan by 6%.

The report added that startups in the MENA region signed 251 financing agreements in H1 of 2020.

The UAE remains the first destination for funding in the region, gaining 59% of the total funding. Although Egypt follows significantly behind with just 19%, this is still a significant increase of 7% over 2019.

Egypt and Saudi Arabia were the only two countries in the region that witnessed an increase in total funding during H1 of 2020 compared to the same period last year.

Moreover, startup investments increased by 35% year-on-year (y-o-y) to $659m across MENA in H1 of 2020. This was due to a strong performance during the first quarter (Q1). The H1 2020 figures are equivalent to 95% of total financing raised by startups in 2019 as a whole.

However, the level of funding decreased significantly in March due to government measures against the novel coronavirus (COVID-19) outbreak, decreasing by 32% in Q2 compared to Q1.

The financial technology (FinTech) retained its top spot as the most active industry by number of deals (16%), while real estate sector received the highest amount of funding.

E-commerce ranked second in terms of the number of deals by 14% in H1 of 2020, followed by freight and transportation at about 10%.

As for the amount of funding, the real estate sector came first at about 24%, followed by e-commerce at 22%.

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