Startup Wrap – Saudi Arabia captures nearly half of MENA’s Q1 funding 

Startup Wrap – Saudi Arabia captures nearly half of MENA’s Q1 funding 
Saudi ventures secured $224 million out of the $429 million raised across the Middle East and North Africa. Shutterstock
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Updated 05 April 2024
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Startup Wrap – Saudi Arabia captures nearly half of MENA’s Q1 funding 

Startup Wrap – Saudi Arabia captures nearly half of MENA’s Q1 funding 

CAIRO: Saudi startups continue to demonstrate a pioneering stance by capturing almost half of the region’s total venture funding in the first quarter of the year, underscoring the Kingdom’s growing influence in the regional startup ecosystem.  

In a notable achievement, Saudi ventures secured $224 million out of the $429 million raised across the Middle East and North Africa, showcasing a robust entrepreneurial landscape in the Kingdom, according to Wamda’s monthly report. 

The surge in startup activity, particularly in March, saw MENA startups raising $254 million across 54 deals, indicating a significant uptick compared to the previous months and a slight increase from the previous year.  

Regional funding saw a 186 percent growth in March compared to February’s $88.7 million, and a 1.17 percent increase compared to the same month last year. 

This resurgence in March’s investment activity, particularly during LEAP24 held in Riyadh, has placed Saudi startups at the forefront, with significant contributions – such as Salla’s substantial pre-initial public offering round of $130 million. 

While the UAE and Egypt trailed with $39 million and $7 million respectively, the majority of the quarter’s funding was directed towards software as a service providers, followed by fintech and e-commerce sectors.  

Despite a predominance of seed rounds and series A funding, there was a noticeable absence of larger ticket sizes and later-stage investments compared to the previous year. 

Investment trends also highlighted a preference for the business-to-business model over business-to-consumer, with male-led startups dominating the funding landscape, the report stated. 

B2C models garnered $48 million, 19 percent of March’s total funding, while B2B saw $188 million, 74 percent of the total amount. 

However, female-led startups and teams with mixed-gender founders also made their mark, albeit to a lesser extent. 

The month was also rich in mergers and acquisitions, including significant deals like MBC Group’s investment in Anghami and Classera’s acquisition of Expert Solutions.  

Additionally, substantial investment funds were announced at LEAP24, further energizing the startup environment and promising more growth and innovation in the region’s entrepreneurial sector. 

Out of the funds announced at LEAP, Investcorp is spearheading the initiative with a $500 million fund dedicated to supporting growth-stage ventures in Saudi Arabia, bolstered by a $35 million investment from Saudi Venture Capital.   

Concurrently, Oasis Capital also announced the introduction of a $100 million fund focusing on early-stage international ventures.  

In the gaming sector, the Saudi Esports Federation, in collaboration with the Social Development Bank and the National Technology Development Program, announced plans to unveil two funds under its Gaming and Esports Sector Financing Program.   

Furthermore, Saudi venture capital firms Merak Capital and Impact46 announced $80 million and $40 million funds, respectively.  

Plug and Play Tech Center is also entering the scene with a pioneering $50 million fund aimed at nurturing software and tech ventures in Saudi Arabia and the MENA region.   

Meanwhile, Takamol Ventures announced a $53 million venture capital fund at LEAP, targeting early-stage tech companies to fuel innovation.  

UAE’s fintech Fortis secures $20m in a series A round 




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UAE’s fintech Fortis announced the successful closure of its series A funding round, securing $20 million led by Opportunity Venture.  

This investment signifies a major step forward for Fortis as it seeks to redefine the retail tech and fintech environment in the MENA region. 

With a decade of experience under its belt, Fortis is on a mission to enable entrepreneurs to efficiently manage their business operations, both offline and online.  

“We are thrilled to have secured this significant investment, which will enable us to accelerate our growth and deliver even greater value to businesses in the MENA region,” Alberto Caruso, Fortis CEO and founder, said.  

“We are committed to leveraging this funding to develop progressive solutions and provide unparalleled support to our clients as they navigate the rapidly evolving retail and fintech landscape,” he added. 

Their services, which include streamlined order management, personalized loyalty programs, and comprehensive business operation tools, are now set to expand in the UAE.  

Fortis is committed to aiding local businesses in enhancing revenue by facilitating better connections between merchants and customers. 

“We are excited to lead Fortis’ series A funding round and support their expansion into the MENA region,” said Philip Ma, managing partner at Opportunity Venture.  

“Fortis’ innovative approach to fintech and retail tech solutions aligns with our investment thesis, and we believe they are well positioned to drive significant value creation in these sectors,” Ma added. 

The newly acquired funds are earmarked for several strategic initiatives aimed at bolstering Fortis’ market position and service offerings. 

Key focus areas include the enhancement of customer-centric services, with plans to improve integration with external platforms while also refining Fortis’s own offerings with an emphasis on user experience and interface design. 

Furthermore, Fortis intends to establish strategic partnerships with key financial and business service providers, integrating its cutting-edge solutions with those of banks, payment systems, and B2B services.  

The development of omnichannel capabilities is also a priority, ensuring that users have a consistent and engaging experience across all platforms and touchpoints. 

In addition to service development, a significant portion of the investment will be channeled into brand-building efforts to boost Fortis’s visibility and credibility in the fintech and retail tech sectors.  

The expansion drive includes broadening Fortis’s footprint across the MENA region and augmenting its team with new talent to support its growth and innovation objectives. 

Bahrain’s Daleel secures investment from Hambro Perks 

Bahrain-based Daleel has successfully raised an undisclosed investment from Hambro Perks Spring Studios.  

Established in 2022 by founders Dania Alshowaikh, PK Shrivastava, and Ridaa Shah, Daleel offers a platform that simplifies the process for consumers to discover and compare various financial products while providing banks and financial institutions with valuable insights to improve customer acquisition. 

The strategic investment is set to fuel Daleel’s expansion efforts, particularly focusing on extending its services to Saudi Arabia and the UAE. 
 


Saudi Arabia’s proptech investments surge 35% to $9m: MAGNiTT report

Saudi Arabia’s proptech investments surge 35% to $9m: MAGNiTT report
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Saudi Arabia’s proptech investments surge 35% to $9m: MAGNiTT report

Saudi Arabia’s proptech investments surge 35% to $9m: MAGNiTT report

CAIRO: Property technology venture capital investments in Saudi Arabia saw an annual increase of 35 percent in 2023 to reach $9 million, according to MAGNiTT’s latest report.  

The venture data platform emphasized that the Kingdom outpaced Africa, the Middle East, Pakistan, Turkiye, and Southeast Asia regions with six proptech deals last year. 

In funding amount, Saudi Arabia ranked fifth across all markets, with Indonesia leading with $54 million, followed by the UAE with $35 million, and South Africa and Singapore with $13 million and $11 million, respectively. 

In terms of deal count, the UAE followed the Kingdom with five deals, while Indonesia, South Africa, and Turkiye each had three. 

Total funding across all markets in 2023 amounted to $157 million, marking an 81 percent decrease compared to the previous year. 

Deal count also experienced a significant annual decline, reaching 34 transactions, reflecting a 40 percent fall compared to 2022. 

MAGNiTT’s Emerging Venture Markets Real Estate report focused on analyzing the property marketplace, co-working, tenancy management, and facility management subsectors. 

The property marketplace was the leading sub-industry, attracting $120 million in funding, though this represented an 83 percent decline compared to the previous year. 

Africa was the best-performing region, with a 10 percent annual increase in funding, reaching $22 million. 

Property management was the most funded subsector on the continent, receiving $18 million in 2023, reflecting a 6 percent annual growth. 

In terms of deal count, Africa experienced a 53 percent drop, totaling seven transactions for the year. 

In the MEPT region, $59 million in funding was deployed in 2023, marking a 78 percent year-on-year decrease.  

This was spread across 19 deals, with the property marketplace being the most funded subsector at $38 million and the most transacted with 11 investments. 

Notably, seven out of the 10 most active investors by capital deployed in the region are headquartered in the US. 

Founded in 2014, MAGNiTT is the largest venture capital data platform in the Middle East, Africa, Pakistan, Turkiye, and Southeast Asia, with a database of over 32,000 startups and 11,000 investment firms. 


Italy’s Fincantieri launches Saudi shipbuilding unit to strengthen collaboration 

Italy’s Fincantieri launches Saudi shipbuilding unit to strengthen collaboration 
Updated 23 May 2024
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Italy’s Fincantieri launches Saudi shipbuilding unit to strengthen collaboration 

Italy’s Fincantieri launches Saudi shipbuilding unit to strengthen collaboration 

RIYADH: Italian shipbuilder Fincantieri plans to enhance collaboration with Saudi Arabia through a newly established unit, the company said. 

Fincantieri Arabia will bolster the Kingdom’s Vision 2030 development agenda in the cruise, defense, and offshore sectors, the group disclosed in a press release, issued on the sidelines of an industrial conference in Riyadh. 

Fincantieri is the only shipbuilding group active in all high-tech marine industry sectors, the release added. 

The new unit aims to highlight the group’s wide-ranging capabilities in shipbuilding, maritime equipment and systems, and naval logistic support services, including training and simulation.  

It will also manage stakeholder relationships in the Kingdom and seek out local partners.  

Moreover, Fincantieri said it plans to share its technological expertise in shipbuilding across cruise, defense, and offshore sectors, thus opening up opportunities for Saudi nationals. 

The firm’s CEO Pierroberto Folgiero: “Our commitment to the Kingdom of Saudi Arabia is steadfast. Fincantieri stands out in the shipbuilding industry for its vertically integrated model and our leadership across naval, cruise, and oil and gas sectors. We are proud to offer these world-class capabilities built on decades of naval heritage and excellence to help the Kingdom achieve its Vision 2030 objectives.”  

He added: “Given the maritime industry’s pivotal role under Vision 2030, we eagerly anticipate establishing strategic partnerships. Through these collaborations, we aim to enhance local technological capabilities, create opportunities for Saudi talent, and foster knowledge exchange.” 

The state-controlled Fincantieri has expanded its presence in the Middle East in recent years. In March 2023, Folgiero stated that the group would venture into the Saudi market and was strategically positioned for growth in the region. 

The Italian group is also aiming to enhance its focus on defense, a sector that presently contributes to around a quarter of its revenues. 

On May 20, Fincantieri concluded a shipbuilding joint venture, named Maestral, with Abu Dhabi-based EDGE Group. The two entities announced the signing of a €400 million ($433 million) contract with the UAE’s Coast Guard Forces for the supply of 10 advanced 51-meter offshore patrol vessels. 


Lebanon’s reforms insufficient for recovery, IMF says 

Lebanon’s reforms insufficient for recovery, IMF says 
Updated 23 May 2024
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Lebanon’s reforms insufficient for recovery, IMF says 

Lebanon’s reforms insufficient for recovery, IMF says 

Lebanon’s economic reforms are insufficient to help lift the country out of its economic crisis, the International Monetary Fund said on Thursday. 

Ernesto Ramirez Rigo, the head of the IMF mission visiting Lebanon, said in a statement that Lebanon’s ongoing refugee crisis, fighting with Israel at its Southern border and the spillover from the war in Gaza are exacerbating an already dire economic situation. 

Israeli forces and Lebanon’s Hezbollah have traded fire across Lebanon’s southern border since the war in Gaza broke out in October last year. 

Israel launched its assault on Gaza following a Hamas-led attack on southern Israeli communities on Oct. 7 in which fighters killed 1,200 people and captured more than 250 hostages. 

Since then, Israel’s assault has killed more than 35,000 people, with thousands more feared buried under the rubble, according to Gaza health authorities. 

The conflict “has internally displaced a significant number of people and caused damage to infrastructure, agriculture, and trade in southern Lebanon. Together with a decline in tourism, the high risks associated with the conflict create significant uncertainty to the economic outlook,” Rigo said. 

Fiscal and monetary reforms carried out by Lebanon’s finance ministry and the central bank, including steps to unify multiple exchange rates for the Lebanese pound and contain a currency slump, have helped reduce inflationary pressure, according to Rigo. 

However, he said more needs to be done if Lebanon is to alleviate its financial crisis. 

“These policy measures fall short of what is needed to enable a recovery from the crisis. Bank deposits remain frozen, and the banking sector is unable to provide credit to the economy, as the government and parliament have been unable to find a solution to the banking crisis,” he added. 

“Addressing the banks’ losses while protecting depositors to the maximum extent possible and limiting recourse to scarce public resources in a credible and financially viable manner is indispensable to lay the foundation for economic recovery.” 

Since Lebanon’s economy began to unravel in 2019, its currency has lost around 95 percent of its value, banks have locked most depositors out of their savings and more than 80 percent of the population has sunk below the poverty line. 

The crisis erupted after decades of profligate spending and corruption among the ruling elite, some of whom led banks that lent heavily to the state. 

The government estimates losses in the financial system total more than $70 billion, the majority of which were accrued at the central bank. 


 


Oil Updates – prices fall for fourth straight day as US rate hike prospects emerge

Oil Updates – prices fall for fourth straight day as US rate hike prospects emerge
Updated 23 May 2024
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Oil Updates – prices fall for fourth straight day as US rate hike prospects emerge

Oil Updates – prices fall for fourth straight day as US rate hike prospects emerge

LONDON: Oil prices eased for a fourth straight session on Thursday after the minutes of a US Federal Reserve meeting revealed discussions of a further tightening of interest rates if inflation remained sticky, a move that could hurt oil demand, according to Reuters.

Brent crude futures fell 20 cents, or 0.2 percent, to $81.70 a barrel at 9:51 a.m. Saudi time. US West Texas Intermediate crude futures were down 29 cents, or 0.4 percent, at $77.28. Both benchmarks fell more than 1 percent on Wednesday.

Minutes released on Wednesday from the Federal Reserve’s last policy meeting showed the US central bank’s response to sticky inflation would “involve maintaining” its policy rate for now but also reflected discussion of possible further hikes.

“Various participants mentioned a willingness to tighten policy further should risks to inflation materialize in a way that such an action became appropriate,” minutes of the Fed’s meeting said.

Higher interest rates boost borrowing costs, crunching funds that could boost economic growth and oil demand in the world’s largest oil consuming nation.

Also weighing on the market, US crude stocks rose by 1.8 million barrels last week, according to the Energy Information Administration, compared with an estimate for a 2.5 million-barrel draw.

Globally, physical crude markets have more recently been pressured by soft refinery demand and ample supply.

“Recent market softness has come on the back of weaker data, including rising oil inventories, tepid demand, and refinery margin weakness and the increasing risk of run cuts,” Citi analysts said in a note on Thursday.

Russia said it exceeded its OPEC+ production quota in April for “technical reasons” and will soon present to the Organization of the Petroleum Exporting Countries Secretariat its plan to compensate for the error, the Russian Energy Ministry said late on Wednesday.

Citi said it still expects that OPEC+, which groups together OPEC and allies led by Russia, will hold its production cuts through the third quarter of this year when it meets on June 1.

Citi also said it continues to see Brent averaging $86 a barrel in the second quarter of 2024. 


Saudi EXIM Bank signs 2 agreements with Japan’s SMBC and MUFG banks

Saudi EXIM Bank signs 2 agreements with Japan’s SMBC and MUFG banks
Updated 23 May 2024
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Saudi EXIM Bank signs 2 agreements with Japan’s SMBC and MUFG banks

Saudi EXIM Bank signs 2 agreements with Japan’s SMBC and MUFG banks

TOKYO: On the sidelines of the Saudi-Japan Vision 2030 Business Forum in Tokyo, Saudi EXIM Bank signed two cooperation agreements with SMBC Business Banking and MUFG Bank.

The agreements aimed to foster cooperation and create co-financing opportunities to promote non-oil exports in target markets, according to the Saudi EXIM Bank.

The two agreements were signed separately by Saad bin Abdulaziz Al-Khalab, CEO of Saudi EXIM Bank, along with Akihiro Fukudom, CEO of SMBC Bank and Hironori Kamezawa, CEO of MUFG Bank, a statement confirmed.

Commenting on the partnerships, Al-Khalab stated: “This collaboration with Japanese entities is part of our joint efforts to strengthen economic relations between both countries and achieve the Saudi-Japan Vision 2030. The acceleration of commercial projects between our nations toward broader horizons comes as a result of the strength, advanced economic status, and promising investment opportunities.”

During the roundtable meeting, which brought together several ministers from both sides, Al-Khalab reviewed Saudi EXIM Bank’s activities with Japanese financial institutions and commercial companies to enhance economic and trade relations and identify projects of mutual interest.

During the financial sector’s roundtable meeting, Al-Khalab emphasized the critical importance of collaborative efforts between all financial institutions and business sectors. This is to ensure the provision of comprehensive, incentivizing credit solutions that can accelerate the pace of trade and mutual and global investment activities.

The Saudi EXIM Bank aims to empower the Kingdom’s non-oil national economy in accordance with Vision 2030. The bank is focused on enabling Saudi non-oil exports to expand and penetrate global markets by bridging financing gaps and reducing export risks.