Investment in startups appears to be slowing for the first time this year with just $10.9 million* raised in fresh funding in September. While more deals were made compared to August and July, investors appear to be signing smaller cheques.
Historically, investments tend to slow down in September but what we may be witnessing now is the trickle effect of the economic uncertainties around the world, with investors taking a slightly more cautious approach by investing smaller amounts. This has given rise to more diverse portfolios and investors across the region have woken up to the necessity and potential of the digital sector.
This perhaps, is most evident in Iraq, a country with a nascent startup sector where two of its startups in e-commerce and delivery, received seed funding. Now, with the establishment of the country’s first angel investor network, KAPITA, more funding is expected to go into the Iraqi entrepreneurship community.
Overall in September, startups raised $10.9 million, in 30 investment deals. Leading in terms of value was Egypt with $3.36 million, of which $2 million was raised by Elves, an app-based concierge service. The six deals in the UAE amounted to $2.78 million, led primarily by Wiz Holding while the three deals in Saudi Arabia amounted to $2.25 million led by Penny.
Of the 30 investments, five were made in education technology, health tech also featured prominently with software as a service comprising six of the deals. This reflects a maturity in VC investments in the region, moving mostly towards the markets that have benefited and witnessed growth from the coronavirus pandemic as opposed to the consumer-driven startups that have dominated over the past few years.
Flat6Labs Bahrain graduated and invested in its latest cohort of eight startups, who made their investment pitches via video.
This report was developed in collaboration with Digital Digest