Venture Capital (VC) investments in emerging markets such as the Middle East, North Africa (MENA), and other regions experienced a sharp decline in 2024, with funding dropping by over 40% compared to 2023.
This downturn reflects a broader global trend in reduced VC activity, particularly for non-AI companies, over the past two years.
According to the report by MAGNITT, a number one source of analytics, data, and insights covering startups, investors, and funds, only $9.1 billion was raised in the Middle East, Africa, Pakistan, Turkiye, and Southeast Asia, as these regions struggle with the global funding downturn.
Despite the significant funding decline, there was positive news recorded, as the total number of investors backing emerging Venture Markets (EVMs), increased by 2% YoY to 1,707, signaling an increase in 2025.
Regional Highlights
MENA: Startups in the region raised $1.9 billion in 2024, a 29% decline. Saudi Arabia emerged as the frontrunner in venture investment, fueled by the $100M+ round by SallaApp. Comprising 40 percent of the total capital deployed in the region. The report also revealed that Saudi Arabia set a new record with 178 VC deals in the same year. This highlights the attractiveness of the Saudi market, boosts its competitive environment, and solidifies the Kingdom’s position as the largest economy in MENA.
Despite fewer deals and funding year-on-year, the absolute number of investors in MENA surged, showcasing a clear focus on smaller ticket sizes at the early stage.
Southeast Asia: This region was the hardest hit by the 2024 downturn, as total funding in the region dropped by 45%, marking its lowest funding and deal levels in over five years.
In the first nine months of 2024 (9M’24), Southeast Asia (SEA) raised $2,770M across 352 deals—a significant 64% drop in funding and a 27% decrease in deal volume compared to the previous year. The funding decline was largely driven by a sharp reduction in MEGA deals.
Africa: This region experienced a 44% funding decline. The African venture capital ecosystem faced significant volatility during the first nine months of 2024, primarily due to an unstable macroeconomic environment. Despite efforts by regional governments to stabilize their economies—such as inflation control measures and climate resilience, amongst others, these pressures have left investor confidence shaken, driving a notable drop in VC funding and deal-making across the region.
In terms of sectors that received the highest number of funding, fintech emerged as a key driver, securing $3.9 billion in funding across MENA, Africa, Southeast Asia, Türkiye, and Pakistan. This underlines fintech’s importance in regions where financial services infrastructure remains underdeveloped. Industries like advertising, Marketing and IT solutions also attracted significant investor interest, with their funding increasing by 181% and 30% YoY respectively.
The report highlighted investment trends showing a predictable split in investor focus. International investors leaned toward late/stage deals, including Insider’s $500 million round and Tyme’s $250 million series D. Local investors on the other hand, primarily supported early-stage startups. The downturn in global VC funding also impacted exits, which dropped by 32% to just 94 in 2024. Additionally, late-stage Capital became scarcer as public markets remained subdued.
Despite the decline in VC investments, the report noted opportunities for mergers and acquisitions (M&A) across geographies within emerging markets. With fintech leading the charge and early-stage funding showing resilience, the ecosystem is poised to rebound as economic conditions show signs of improvement.
