Mubasher TV
Contact Us Advertising   العربية

KSA startup funding hits record high in H1-20

KSA startup funding hits record high in H1-20
Saudi Arabia startup funding more than doubled during H1

Riyadh - Mubasher: Funding in Saudi Arabia-based startups signalled a significant growth faster than the average in MENA despite the setback from COVID-19, according to a report by MAGNiTT and the Saudi Venture Capital Company (SVC) on Wednesday. 

The region’s 17 countries recorded a 35% yearly increase in total funding during the first half (H1) of 2020, while Saudi Arabia’s startup funding advanced by 102% to reach a record high of $95 million.

Whereas the MENA region saw an 8% annual decrease in the number of deals over H1-20, Saudi Arabia registered a 29% increase.

Many investors have shifted their investment mandate, whether in terms of stage or industry, as a result of the pandemic crisis, which has considerably affected startups’ cash flows and revenues, according to a MAGNiTT and INSEAD report.

Meanwhile, many high-profile funding rounds included Jahez ($36.5 million), Nana ($18 million), and Noon Academy ($13 million), which are remarkably active in industries whose adoption was accelerated amidst COVID-19. For example, Jahez and Nana are active in food and grocery e-commerce, respectively, while Noon Academy focuses on the EdTech space.

Consequently, e-commerce came as the most active industry by a 67% of total funding and a 22% of number of deals.

Moreover, other industries, such as sports and fitness, showed a decline in deals and revenues, falling from third place by the number of deals in H1-19.

“Many government initiatives have focused to alleviate the burden of the COVID-19 outbreak, including deferred payments, waived fees and bills, paid vacation, and salary guarantees for 70% of a company’s Saudi employees,” the report concluded.