Guardians of the Future: 2021, a defining year for VC

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In the most exceptional year for VC investment globally, the final year data posted by CB Insights marks a 2x YoY growth in VC funding across global markets (Europe and the Americas). Our Emerging Venture Markets, on the other hand, have observed an almost 3x YoY surge in VC funding across MEAPT, a feat that remains remarkable for nascent and growing entrepreneurial spaces in the region. This exponential rise in VC funding is not only important because it reflects increased investor and government confidence in home-grown Tech venturers and digital innovations, but it is an indicator that at the forefront of any real innovative progress is a proactive entrepreneurial world. 

It is no hidden aspect that for long, Emerging Venture Markets like Egypt, Pakistan, Lebanon, and many more have had significant delays in the technology available, extraneous obstacles due to government bureaucracy and outdated infrastructures, and little to no access to tangible growth opportunities for businesses and SME’s. This, however, has been changing gradually over the years with much of it credited to the entrepreneurial and VC spaces emerging in these geographies, acting as parallel and independent innovation hubs. After 5 years of exemplary growth, everything changed when the pandemic pushed public and private stakeholders to think about their avenues clearly; naturally, where traditional business and government initiatives fell short, startups and innovation spaces proved their real weight.


 


In 2021, VC focus in Emerging Venture Markets was in congruence with global trends, where FinTech was the number one target in every investor board meeting. Over the past year, VC capital deployed in the FinTech sector across EVMs accounted for more than 30% of total investment. A quick look at the startups raising funds we find that many of these ventures secured the present, with BNPL offerings like Nejree (KSA) or ZoodPay, digital POS solutions across industries like POSRocket (JOR) and Fawry (Egy), Tech-driven Cash on Delivery Solutions Tabby, holistic FinTech-powered B2B solutions like Sary (KSA) and Bazaar (Pak) raising major rounds. But more importantly, and at a wider lens, many of these ventures have also been setting up for the future, with FinTechs like Cryptocurrency and neo banking platforms Baraka, BitOasis, and FinTech Galaxy championing the new generation.  

A recent study we shared on MAGNiTT conducted by global payments platform Checkout.com attributed the drive for payment solutions, which trickled into a general FinTech surge, to the significant rise in digital adoption and prevalence of E-commerce solutions. It comes as no surprise that the Pandemic was a natural catalyst for this adoption, where for a year the only access to products aside from neighborhood stores was available only through online marketplaces. Yet, the E-commerce space across MENAPT has been observing a 3-year consecutive growth in Funding to increase by 230% since 2017. Surely, last year’s funding growth could be attributed to E-commerce stars like MaxAB, Capiter, Tajir Pakistan, Bazaar, and Sary, and the possibility of future E-commerce success could be attributed to online marketplace builders like Opontia, Akinon (Turkey), or Taager (Egy)- all of which raised sizable investments in 2021. 

Yet, what has been the most remarkable feat of 2021 globally and in Emerging Venture Markets is that entrepreneurs went beyond just being saviors of the current moment and into guardians of the probable future, and that future is called: Convenience and Speed. Last year, VC spaces across MEAPT  welcomed the world of Q-commerce, the hyper-localized offerings integrating fleet & inventory management, ML & AI technologies, and seamless interfaces to deliver your orders in unprecedented 15-minute windows. All eyes are on Turkey-based Getir, Pakistan-based Airlift & Krave Mart, Egypt-based Rabbit, UAE-based Yalla Market, and most recently Kuwait-based Fiz amongst many of the Q-commerce champions, bringing you the future of online ordering in the years to come. The above-mentioned trends are only the tip of the iceberg which will become our bread and butter for the upcoming months. As we prepare for the much-anticipated release of our End Of Year Reports, we’ll be exploring all the significant drivers of innovation for 2021, which has surely become nothing short of a defining moment for VC ecosystems across Emerging Venture Markets. 


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