Start-up funding up 102% in KSA

July 15, 2020 | By RetailME Bureau

Start-up funding in the Kingdom of Saudi Arabia (KSA) has seen a 102% surge during the first half of 2020, compared to the same period in 2019, indicates MAGNiTT.

With this increase, total funding in Saudi Arabia has grown significantly faster than the average in MENA. The 17 countries in the region saw a 35% increase in total funding from H1 2019 to H1 2020 according to MAGNiTT’s H1 2020 MENA Venture Investment report, while Saudi Arabia’s funding grew 102%. Moreover, while the MENA region saw an 8% drop in the number of deals from H1 2019 to H1 2020, Saudi Arabia saw a 29% increase.

Download the report

“Saudi Arabia has been one of the fastest-growing ecosystems in the region for a few years now, which has continued during COVID-19,” said Dr. Nabeel Koshak, CEO, Saudi Venture Capital Company (SVC). “As part of Vision 2030, many new initiatives have been launched in recent years to spur innovation and start-up growth. Saudi Arabia has always been an attractive market for local and regional entrepreneurs due to its large market size. In recent years, it has also developed a start-up ecosystem to match it.”

The increase in funding and deals comes amid the COVID-19 crisis, which has affected start-ups’ cash flows and revenues significantly, according to a MAGNiTT & INSEAD report. As a result of the crisis, many investors have made a shift in their investment mandate, both in terms of stage and industry.

“We are seeing a shift in investor appetite when it comes to start-up development stages,” stated Philip Bahoshy, CEO & founder, MAGNiTT. “There are two key factors at play. First, the full impact of COVID-19 is likely to hit later in the year. As we know, it takes an average of 9-12 months to fundraise. Many deals in Q1 2020 will have already been in the works for a period of time. Second, what we see is that more later-stage investments with larger round sizes have been taking place. This highlights a shift to more established start-ups, which can provide them a longer runway to weather the challenging times ahead.”

In H1 2020, Saudi Arabia saw several high-profile funding rounds which included Jahez ($36.5 million), Nana ($18 million), and Noon Academy ($13 million). Each of these start-ups is notably active in industries that have seen a significant increase in adoption amid COVID-19: Jahez and Nana are active in food and grocery e-commerce, respectively, while Noon Academy focuses on the EdTech space. As a result, e-commerce obtained the top spot as the most active industry by both total funding (67%) and the number of deals (22%).

Throughout the year, there have been many government initiatives focused on alleviating 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.

“A healthy and flourishing entrepreneurial ecosystem takes years, if not decades, to build and develop. Supporting founders and encouraging investors now will benefit the ecosystem for many years to come,” Bahoshy concluded.


For all the latest retail news from the Middle East, follow us on Twitter and LinkedIn, like us on Facebook and subscribe to our YouTube page.



Previous Article Next Article


elGrocer, the grocery delivery app with ties to some of the major 

Continue Reading

October 25, 2020 | By RetailME Bureau

Jones the Grocer set to open its doors at Dubai’s newly launched 

Continue Reading

October 18, 2020 | By RetailME Bureau

Saudi-based operators of hypermarkets and supermarkets BinDawood Holding Company has completed the 

Continue Reading

October 16, 2020 | By RetailME Bureau

The regional food and grocery delivery app Talabat has announced the expansion 

Continue Reading

October 15, 2020 | By RetailME Bureau

Walmart is hiring 10,000 new employees in Canada for positions in stores 

Continue Reading

October 14, 2020 | By RetailME Bureau

British quality grocery retailer Waitrose & Partners launched its first e-commerce platform 

Continue Reading

October 11, 2020 | By RetailME Bureau

Saudi Arabia-based operator of hypermarkets and supermarkets BinDawood Holding has priced its 

Continue Reading

October 7, 2020 | By RetailME Bureau
Miguel Angel Povedano, chief commercial officer of Majid Al Futtaim – Retail

Majid Al Futtaim announces the launch of a customer insight platform, powered 

Continue Reading

October 7, 2020 | By RetailME Bureau
New Choithrams store opens at Emerald Court, Al Barsha

A new Choithrams store opens at Emerald Court, Al Barsha in Dubai 

Continue Reading

October 5, 2020 | By RetailME Bureau
Asda has new owners

Asda has new owners, as The Issa brothers and TDR Capital are 

Continue Reading

October 5, 2020 | By RetailME Bureau
Spinneys sees “dramatic changes” in shopping patterns

UAE-based supermarket chain Spinneys sees “dramatic changes” in shopping patterns since the 

Continue Reading

October 4, 2020 | By Rupkatha Bhowmick
Food Crowd is now delivering from farm to home

A new platform in the UAE, Food Crowd is now delivering from 

Continue Reading

October 1, 2020 | By RetailME Bureau

Download Images RetailME Magazine