The Middle East’s booming venture capital market

The Middle East’s booming venture capital market

The venture capital market may have plummeted last year, but the Middle East and Africa (MENA) has witnessed a flurry of activity as deals dry up in other parts of the world. After a record-shattering 2021, the world entered a parallel universe of investor caution last year amid a slowing global economy, geopolitical tensions and steep valuation resets that fuelled mass layoffs across the tech industry. The story is different in the Middle East – home to some of the world’s biggest sovereign wealth funds – where investors are flush with cash from last year’s oil boom. Similarly, GCC countries have done well thus far in supporting small and medium-sized enterprises (SMEs), a sector that is central to governments’ economic diversification and job creation strategies. MAGNiTT, a Dubai-based research firm, said that though there was a decline in funding and deals in the last quarter of 2022, the latest data shows sustained levels of funding and a steady number of transactions in the Middle East, Africa, Pakistan and Turkiye (MEAPT) region. Dealmaking in the Middle East is being led by the UAE, which accounted for nearly 50 per cent of the total venture funding between 2018 and 2022. S&P Global