Startups in the Middle East and North Africa (MENA) region raised a total of $289 million in May 2025, according to newly released data, representing a 25 percent increase compared to April and a modest 2 percent rise year-on-year. The capital was spread across 44 disclosed deals, indicating a steady flow of investor interest despite persistent global economic uncertainties.
Equity financing remained the predominant source of capital, comprising 91 percent of the total funding. Debt financing, by contrast, accounted for just 9 percent, signaling a continued preference among investors for equity-based arrangements in early and growth-stage ventures.
Egypt Takes the Lead
Egypt emerged as the top destination for startup capital in the region, raising $125 million across eight disclosed deals. The single largest contributor was property technology startup Nawy, which closed a $75 million round. The remaining $50 million was spread across seven other startups, highlighting the country’s growing appeal among regional and international investors.
The United Arab Emirates followed with $86.7 million secured across 14 transactions, reflecting the UAE’s sustained role as a startup and venture capital hub. Saudi Arabia ranked third, raising $69 million through 15 deals, underscoring the Kingdom’s ongoing economic diversification efforts and commitment to fostering entrepreneurship. Kuwait entered the top four markets for the month, with two startups raising a combined $6 million, a notable development in a typically quieter market.
Sector Highlights and Trends
Despite heightened global interest in artificial intelligence (AI), investment in the sector within MENA remained limited. AI startups raised just $25 million through two deals, suggesting a disconnect between public enthusiasm and actual capital deployment in the space.
Fintech continued to lead all sectors, attracting $86.5 million across 14 rounds. Property technology followed, driven largely by Nawy’s substantial raise. Media technology companies attracted $32 million, while construction technology firm WakeCap secured $28 million in a later-stage round, one of the few notable Series B+ deals for the month.
Early-Stage Dominance
Early-stage investments dominated the funding landscape, accounting for $161 million of the total capital raised. Only one pre-Series C deal was reported, valued at $12 million, indicating that most investor activity remains focused on seed to Series A stages.
Business-to-business (B2B) startups drew the majority of interest, raising $157 million across 29 deals. Hybrid models combining B2B and business-to-consumer (B2C) elements raised $79 million, while purely B2C startups collected $53 million.
Persistent Gender Imbalance
The gender disparity in startup funding remained significant. Male-founded teams received 82 percent of the total capital deployed in May. In comparison, startups led by female founders accounted for just 7 percent of the funding, while mixed-gender founding teams secured 11 percent.
The data highlights the MENA region’s resilience in attracting venture capital, with notable activity in Egypt and a strong showing from fintech and B2B-focused ventures. However, the limited funding for AI and the continued gender gap point to areas that still require focused attention from investors, accelerators and policymakers.
