As we move into December and get closer to the end of the year, we can reflect on the changes and trends that have taken place in the startup ecosystem in the Middle East and North Africa. In MAGNiTT’s November 2019 Dashboard, it was highlighted that 35 deals took place in November 2019, an increase of 192% compared to the same month last year. With this increase, the year has already surpassed last year by number of deals, a record.
Furthermore, November 2019 saw a 62% drop in total funding compared to November 2018, with $66M being invested in those 35 deals. The United Arab Emirates (UAE) still accounting for the lion’s share of total funding, while Egypt accounts for the highest number of deals – more on that in MAGNiTT’s upcoming 2019 MENA Venture Investment Report.
One of the key drivers of the Egyptian startup ecosystem is the increase in the number of accelerators. Flat6Labs Cairo, for example, recently announced the graduation of 11 Egyptian startups for its second cohort of the year. These startups include smart home solution developer AION, medical insurance platform Axon, cloud-based engineering solution BeXel, expert-finder Consulting Pad, medical service booking platform Curotrip, business procurement service Fridge, logistics startup HOVO, laundry service Makwa, shipping platform ShipHaly, recruitment service Talents Arena, and website builder Wuilt.
Moreover, 500 Startups, the most active venture capital fund in the MENA region by number of deals in 2019, also sees Egypt as a key market in the region. As of late, a lot of focus has been placed on the Egyptian startup ecosystem, according to Hasan Haider, Partner at 500 Startups, with a specific focus on FinTech, logistics, transport and on-demand products and services.
Hasan Haider states that “in my opinion, Egypt is one of the fastest growing startup ecosystems in the MENA region. We love investing in Egyptian startups - the founders are passionate, driven, motivated to succeed with an amazing technical talent base. Combining that talent, motivation, and the large market size that exists - Egypt really is the main market to be investing in.” 500 Startups has invested in 37 Egyptian startups to date, making 30% of its MENA portfolio.
Continuing the trend from 2018 and 2019, the FinTech industry leads with the highest number of deals (7 last month), bringing the total number of deals in the industry to 68 this year. As highlighted in MAGNiTT’s 2019 MENA FinTech Venture report, in collaboration with Abu Dhabi Global Market (ADGM), the FinTech industry is growing quickly, but is still in its early stages.
Coming up in January, MAGNiTT will be launching the 2019 MENA Venture Investment report. An in-depth report taking both a bird’s eye view as well as an analytical approach to identifying trends and changes in the ecosystem, the readers will be able to understand the events, announcements that unfolded during 2019 as well as a breakdown of funding activity and exits. Stay tuned!