MENA Startup Investment Plummets 76% in March 2025
Startup investments in the Middle East and North Africa (MENA) region experienced a significant downturn in March 2025. Total funding plummeted by 76% to $127.5 million across 28 deals, a stark contrast to the $530 million raised in February 2025. The United Arab Emirates (UAE) led the region in funding, raising $104.4 million.
The sharp decline in investment is largely attributed to the impact of the U.S. trade war with global partners. Countries like China, Canada, and Mexico, which have been significantly affected, have seen a ripple effect on global trade, including the MENA region. However, specific data on the direct impact of these trade wars on the MENA region is not detailed.
Later-stage startups raised $46 million, accounting for 36% of total investment, while early-stage startups raised $58 million, making up 70%. Notably, Web3 startups received no investment in March 2025, after raising $5 million in February 2025 and $100K in January 2025.
Business-to-business (B2B) models received the most funding, with 16 startups raising $97 million. Business-to-consumer (B2C) ventures raised $24 million. Egypt came second in funding with $11.6 million, followed by Saudi Arabia with $8 million. Fintech dominated funding with $82.5 million, followed by Healthtech with $16 million, and AI with $14 million.
The significant drop in startup investments in the MENA region in March 2025 is a cause for concern. While the UAE led in funding, the overall decline is attributed to the impact of global trade wars. Despite this, later-stage and early-stage startups managed to secure significant funding. The dominance of B2B models and fintech in funding suggests a shift in investor preferences towards more stable and scalable business models.
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