MENA's startups saw an increase in funding in Q1 2020
Despite the COVID-19 crisis, MENA's startups saw an increase in funding in Q1 2020, according to a special Q1 2020 MENA Venture Investment Report launched by MAGNiTT.
This 67-page report includes Insights into 28 industries, with a deep-dive into top industries by deals and total funding including rankings and trends of 17 countries, with a deep-dive into top countries by deals and total funding. The report also highlights funding trends of MENA-based startups, including the top 10 deals, pre-money valuation by stage with average pre-money valuation at Seed & Series A.
Moreover, while the funding in Q1 2020 has slightly increased compared to Q1 2019, it can be seen that the majority of the top 5 funding rounds were announced before the crisis forced many countries into lockdown.
While investors highlighted to MAGNiTT that they are still actively looking to invest, the true ramifications of the crisis are not expected to be seen until several months after the start of the crisis. The fundraising exercise often takes several months for founders and investors, delaying the impact of the current situation.
March saw a significant slowdown in number of deals, which is expected to continue over the next few months as the ramifications of COVID-19 come into play.
"Historical data highlights that investment rounds across MENA tend to take, on average, 6 months to come to fruition,” explains Philip Bahoshy, MAGNiTT’s founder & CEO. “We will most likely not see the full impact of COVID-19 on the venture funding space yet for a few months. However, early indications have already shown a slowdown in funding announcements, as startups and investors re-evaluate their positions in this new environment.”