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MENA investor activity reached record high in 2020

Around 25 percent of all investors were based outside of the MENA region, with 11 percent headquartered in the USA

By: Business Today Egypt

Mon, Feb. 22, 2021

Investor sentiment reached a record high of 256 active investors deploying a total of $1 billion in venture capital in MENA last year, according to MAGNiTT’s 2021 MENA Venture Investor Ranking Report.

The report deep dives into the activity of investment institutions that financed MENA-based startups in 2020, providing a comprehensive ranking of venture capital investors in the MENA region and explores the shifts in investor focus driven by COVID-19

Around 25 percent of all investors were based outside of the MENA region, with 11 percent headquartered in the USA and 7 percent in the European Economic Area.

The UAE had the most registered investors with 22 percent of active institutional investors in the region in 2020, with Saudi Arabia close behind at 19 percent.

Looks like activities by accelerators only accounted for only 10 percent of all active investors in MENA across all countries, a 28 percent drop from 2019.

FinTech was the most popular sector, ranking 1st with 63 firms investing specifically in mobile and online payment solutions.

“Despite COVID-19, we saw continued interest from international investors and new funds investing in MENA based startups. As the ecosystem continues to mature, and as MAGNiTT further expands into Emerging Venture Markets, we expect to see increased cross pollination across markets like Turkey and Pakistan, as well as increased international interest in the MENA region,” Philip Bahoshy, MAGNiTT Founder and CEO, explains.

According to MAGNiTT’s 2021 Investor Ranking, 500 Startups, a US firm investing in the region via its Bahrain-based 500 Falcons fund, topped the ranking as the most active investor in MENA-based startups in 2020.

The fund participated in 42 deals across various industries in the region, including E-Commerce fulfillment startup Salasa’s $8.6 million Series A round and FinTech NowPay’s $2.1 million seed funding.

Bedy Yang, Managing Partner at 500 Startups commented, “MENA is starting to get the attention it deserves. Since 500 Startups began investing in the region nearly 10 years ago, we’ve seen an increase in the quality and quantity of deals, as well as a maturing of the ecosystem. The region is at an inflection point, and we’re very excited about the progress.”