Amidst a general surge of VC activity across EVMs, we list MENA's top geographies by number of recorded Exits in 2021
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The year 2021 was filled with funding and liquidity events which boosted an overflow of capital across Emerging Venture Markets. As a continuously steady sign of VC ecosystem growth, we’ve observed unprecedented investor participation, a record amount of capital deployed over exceptional records of transactions, and a remarkable number of Exits more than doubling that of the year before. Exits as liquidity events are not only great indicators of startup founders’ success in scaling their ventures but also position the ecosystem as a preferable investment environment after investors reap their returns.
As we recorded more than 80 exits in our State of Startup Funding- 2022 Emerging Venture Markets free report, this number remains exceptionally high relative to previous years. Surely, it has been evident that homegrown startups are getting creative with their expansion strategies, where we’ve seen diversified Exits over the past years: SPAC mergers with Anghami and SWVL, IPO Exits with KSA-based Jahez and Egypt-based Fawry, to cross-market acquisitions and international exits. The latter excites us the most at MAGNiTT, where cross-market acquisitions like that of Jordan-based Abwaab to Pakistan-based Edmatrix and international exits like that of US-based Stillfront Group to Jordan-based Jawaker, allude and perhaps foreshadow the rise of viable regional players- a new level for the VC ecosystem and one step closer at becoming global contenders.
While we observe many firsts for the VC ecosystem in EVMs like debut investments by international players including Sequoia Capital and Wavemaker Partners, as well as extended and debut market entries from international players like Zynga or Alibaba in Turkey we hone our focus on MENA. In congruence with our MENA 2022 Venture Investment Report we list the top 3 Exit Geographies in 2021 with highlights from every region:
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The top Exit geography in MENA for 2021 was the UAE, which also is positioned as the most funded and top transacted geography over the past year. After an 80% YoY dip in the number of Exits recorded in 2020, UAE-based startups picked up where they left off and recorded 8 extra exits in 2021 to reach the second-highest record of 11 Exits. Over the past year, startups across a wide range of industries including E-commerce, FinTech, InsurTech, HealthTech, Content Marketing, and Entertainment recorded Exits with UAE-based cloud kitchen Tech iKcon leading the drive.
After raising sizable investments, the last being a $20M Series A investment backed by the likes of Derayah and BYVP, the cloud-kitchen Tech startup gets acquired by US-based PropTech REEF. The US-based company builds, powers, and manages delivery kitchens and proximity hubs, specializing in the optimization and digitization of every space they’re given. This international acquisition, however, is one amongst many for UAE in the past year, where US-based players seem more and more attracted to UAE-based startups. Other international acquisition success stories include Fashion FinTech startup Spotii getting acquired by US-based Tech startup Zip Co, Event Tech startup Eventtus getting acquired by US-based Bevy, and finally, HealthTech startup Sehteq getting acquired by US-based Cloud Kair.
Highlight: Platform One
Coming second in 2021, the 133% YoY growth in the number of announced Exits drove a new all-time record of 7 Exits in Egypt in 2021. While Egypt-based startups accounted for 15% of all transactions closed in MENA, they recorded 30% of all Exits, where startups in EdTech, E-commerce, HealthTech, Transport & Logistics, and Cyber Security all announced their acquisitions in 2021. In another win for B2B E-commerce ventures, a space that made great strides over the past year, the B2B pharmaceuticals online marketplace Platform One gets acquired by its US-based counterpart Aumet Inc. Together these two entities will merge to give pharmacies in Egypt access to Aumet’s full product suite which includes Aumet MarketPlace, connecting Pharmacies with Pharmaceutical Suppliers through mobile app and web applications, and Aumet Pharmacy, POS, and inventory management software solution, allowing pharmacists to manage their cash flow, and automate orders.
Many notable international, cross-market, and local Exits have also been announced in Egypt last year across all industries. Highlight stories include Home servicing platform FilKhedma getting acquired by its South African counterpart SweepSouth in a move for market consolidation, T&L startup FWRUN getting acquired by Saudi-based DIGGIPACKS in a cross-market expansion, and finally, content marketing platform Connect Ads getting acquired by US-based corporate group Aleph Holding.
Highlight: Last Scene Films
Despite the Exits recorded being conservative relative to its peer geographies in the Top 3, a big win for Saudi Arabia this year is it surpassing Egypt in the amount of Capital Deployed for the first time. While the Kingdom observed a stellar 270% YoY growth in Funding over 2021, Saudi Arabia recorded 1 less Exit than the year before to boast a well-positioned record of 4 Exits in 2021. As is the case with most other aspects of the Saudi Arabian VC dynamics, all Exits recorded by Saudi startups last year were by local acquirers, reflecting a healthy network of homegrown expertise. Highlighting these 4 local Exits was the Kingdom’s young film studio Last Scene Films getting acquired by the veteran Media & Entertainment group Telfaz11. As the emerging studio signs an 8-picture deal with Netflix, it was a perfect merger on the table considering the pioneering position Telfaz11 had with digital and video content more than 10 years ago.
With plenty of record-highs and remarkable data points including a double YoY Exit growth and unprecedented international investor participation across geographies, make your own conclusions of full-year 2021. Download our Free State of Startup Funding- Emerging Venture Markets 2022 report and enter 2022 with extensive data.
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