FULL STEAM AHEAD
dubai — The UAE continued to dominate the startup industry in the Mena region, both in terms of deal counts and value in 2017.
According to the Mena Annual Venture Report for 2017, UAE startups secured $400 million (Dh1.47 billion) or 84 per cent out of the $475 million (Dh1.74 billion) raised by regional startups last year. It is largely due to the Careem and Starz Play deals as nearly half of the fund-raising came from these two transactions. Careem and Starz Play raised $150 million and $125 million respectively.
“There was a lot of activity throughout the region in terms of announcements of new big funds, new early-stage venture capital making their first investments, especially from Saudi Arabia and Egypt, and launch of new accelerators that offered up to $125,000 in investments,” said Zubair Paracha, author of Menabytes report.
“Even when we exclude Careem and Starz Play deals, the UAE still
We see the beginning of a startup revolution taking place in the Middle East, especially the GCC and the UAE Dawood Alshezawi, President of AIM Startup
remains far ahead in terms of total deal share by value, with 63 per cent or $125 million. Saudi Arabia comes in second mainly due to the $20 million PayTabs deal. That one deal alone represents more than 70 per cent of the entire deal value of Saudi startups,” Paracha noted.
Dawood Alshezawi, president of AIM Start-up, said 2017 went well for startups in the GCC. Alshezawi added that 2018 looks very promising for the startup sector as the number of startups in the region is growing fast.
“We have recently concluded a series of regional startup pitches for the top startups to attend the forthcoming AIM Startup event in April, where hundreds of startups line up for funding support. Entrepreneurship and startups will play a crucial role in creating new jobs and help
There was a lot of activity throughout the region in terms of announcements of new big funds Zubair Paracha, author of Menabytes report
absorb a large chunk from among the 100 million new jobless people in the Arab world,” he said.
The World Economic Forum and the International Finance Corporation have partnered to bring together 100 Arab world startups which are shaping the future in the context of the Fourth Industrial Revolution (Industry 4.0).
“We see the beginning of a startup revolution taking place in the Middle East, especially the GCC and the UAE. In the UAE, we are closely working with the Ministry of Economy to help develop a startup ecosystem where startups, venture capital funds and other stakeholders could join hands to create a win-win situation. There are a number of country-wise initiatives and institutions being developed for the startup sector and one can feel the buzz at the forthcoming AIM Startup to be held from April 9 to 11, where we expect thousands of visitors networking on entrepreneurship, mentoring and funding startups,” Alshezawi said.
Egypt, Jordan and Lebanon account for about 18 per cent of the entire deal value in the region. Each of these countries had two or more million-dollar rounds. Morocco, Tunisia and Bahrain account for almost four per cent together; with each of these countries having $1 million round.
The region saw e-commerce maintaining its dominance in startup deals, followed by local services, financial services, logistics, software, healthcare, F&B, technology and transportation, the report said.
It noted that 50 per cent of total deals in the region were pre-seed or seed investments, suggesting a lot of interest in early stage startups.
For the UAE, the highest number of deals were in the $1 million to $4.99 million range. But there was a lot of activity in pre-series A and Seed with 12 deals in each one of them.
“2017 was a year that saw a mix of domination by old and new players. Five hundred startups became very active after closing $15 million for their $30 million Mena-dedicated fund,” Paracha added.
The report tracked 134 deals of 123 startups in 12 countries.
— waheedabbas@khaleejtimes.com