Weekly Insight: Startup Investments in Africa and the Middle East - Week 32, 2025
In the bustling landscape of global startups, the Middle East and North Africa (MENA) region, and Africa are making significant strides, particularly in the sectors of fintech, logistics, and Artificial Intelligence (AI).
MENA Region: A Fintech and AI Boom
The first half of 2025 saw MENA startups raise an impressive $1.5 billion from 310 deals, with fintech leading the way, tripling year-over-year to approximately $596 million. Saudi Arabia and the UAE have taken the lead, accounting for the majority of the investment. Saudi Arabia, in particular, captured around 64% of regional investment and showed a staggering 342% growth compared to H1 2024.
July 2025 marked a significant month, with 57 startups raising a collective $783 million, a 1,411% month-on-month increase. Emerging markets like Iraq and Morocco are also gaining investor attention beyond traditional hubs.
Notable recent rounds include Coraly.ai, an AI-driven proptech startup, which secured a $2 million pre-seed round to enhance real estate sales workflows using AI.
The region is experiencing abundant late-stage deals (Series A and B), strong M&A activity, and a growing pipeline of early-stage startups, with government policies significantly supporting ecosystem growth.
Africa and South Africa: Growing Interest
While the focus is predominantly on MENA, African fintech and AI startups have also attracted growing investment interest, with South Africa as a key hub. However, specific recent rounds in fintech, logistics, and AI within South Africa were not detailed in the provided results.
Regional reports generally indicate an upward trend in funding across sectors like fintech and AI in Africa, driven by innovation hubs in Johannesburg and Cape Town. The precise funding amounts and deal details for 2025 would require further research.
Notable Funding Rounds
- Alaan, a UAE-based B2B spend management platform, secured a $48 million Series A round, led by Peak XV Partners (formerly known as Sequoia India).
- Salasa, a fulfilment startup based in Saudi Arabia, raised $30 million in Series B funding, led by Artal Capital, with 500 Global, SVC, and Wa'ed Ventures also participating.
- Iraq's logistics aggregator Boxy closed a $1.5 million pre-seed round.
- The growth in alternative fintech models, such as RIFD, suggests a shift in the financial landscape in the Middle East and Africa.
- Deep.SA, a Saudi Arabian AI company, raised $1.2 million from Tam Development and Raed Ventures.
Emerging Trends and Opportunities
The energy in Middle Eastern and African startups is growing, with companies raising funds, building solutions for local needs, and gaining global attention. For instance, E-commerce is gaining serious ground in Saudi Arabia, with logistics enablers like Salasa seen as foundational pieces of the wider digital economy puzzle.
South African travel fintech TurnStay raised $2 million to help tour operators streamline payments and bookings, while South African startup Flood raised $2.5 million to build out its SuperApp-as-a-Service offering. The funding for Flood will be used to develop a model for companies to roll out all-in-one customer platforms without building from scratch.
In conclusion, MENA, led by Saudi Arabia and the UAE, is experiencing a robust surge in startup funding with fintech and AI receiving the lion's share. African startup rounds, especially in South Africa, remain active but less detailed in current data. Continued ecosystem maturation and government backing are key drivers of this growth. The region's potential is undeniable, and the future looks promising for startups in MENA and Africa.
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