Scaling MENA #13
MENA startups continue to raise as the region remains resilient.
Welcome to the Scaling MENA newsletter, bringing you the top stories from across the region every week.
I hope you find the newsletter insightful, but I’m always open to feedback and suggestions. Let’s get into it!
💰 Investment Rounds
🇪🇬 Lucky raised $23M in Series B led by Disruptech Ventures. See more here.
🇲🇦 Zsystems raised $1.65M in seed led by Azur Innovation Management. See more here.
🇸🇦 Maison Safqa raised $620K in pre-seed from Sanabil 500. See more here.
🇸🇦 ElGoat raised $266K in seed via Trigon. See more here.
📰 Startup News
Propeller takes five MENA deeptech startups to Silicon Valley
Propeller, the Jordan-rooted AI-focused VC, just launched the first cohort of Kernel Camp, an eight-week residency bringing five MENA deeptech startups into the heart of Silicon Valley.
The program addresses a structural gap: MENA produces world-class technical talent, but founders lack direct access to the networks, capital, and operator communities that shape the global AI infrastructure landscape.
The inaugural cohort includes:
OORB (Tunisia) - building cloud robotics workspaces for ROS projects
Eli by Techbible (Morocco) - an AI Stack Manager providing visibility into SaaS and AI tool spend
Firstflow (Jordan) - an onboarding and analytics layer for AI agents
Nexguards (Egypt) - a personalised cyber attack simulation platform
Flowbrave (Morocco) - transforming static processes into AI-guided workflows
Propeller is covering housing, curating workshops, arranging weekly guest sessions with world-class builders, and organising site visits to leading Bay Area tech companies and VCs. The program was announced in December 2025 as part of Propeller’s Fund III cross-border strategy.
The eight-week residency concludes with a demo day in May 2026, connecting founders directly with Bay Area investors.
Read more here.
MENA startup funding falls 85% in March
March 2026 was brutal. Just 17 MENA startups raised a combined $48.3 million, an 85% drop from February’s $327 million and a 62% decline from March 2025. It’s one of the weakest months the region has recorded in recent years.
The US-Israeli war against Iran and retaliatory strikes targeting oil and infrastructure assets across the GCC have forced investors into wait-and-see mode. Investors are reassessing exposure to sectors vulnerable to prolonged instability. Founders are delaying announcements of closed rounds, waiting for clarity or a ceasefire before going public.
The slowdown hit harder because key dealmaking platforms lost momentum. LEAP, which typically anchors major funding announcements, was postponed. That removed a critical catalyst for deal visibility and closed the pipeline for what would have been Q1’s largest rounds.
UAE retained its position as the region’s leading market, capturing $36.8 million across eight deals, 76% of total capital deployed. Saudi Arabia followed with $10.2 million across four transactions, but ticket sizes were significantly reduced.
Egypt’s complete absence is the most striking signal. Zero deals. The country that typically ranks among the top three markets was entirely off the board. Morocco took third place with $1.2 million across two deals, followed by Qatar ($500K, one deal) and Syria ($100K, one deal).
Fintech held ground as the top sector, raising $15.1 million across three deals. Healthtech followed with $15 million across two startups. SaaS secured $6.7 million across three transactions.
Consumer-focused startups dominated capital allocation, raising $31.7 million across seven deals, while B2B startups raised $16.5 million across nine transactions—indicating smaller average ticket sizes and more cautious deployment.
The gender gap widened. Zero funding went to female-founded startups. All disclosed capital flowed to male-founded companies, extending a troubling trend from February.
Why the Region Will Bounce Back
The fundamentals haven’t changed. 2025 closed at $7.5 billion raised, a 225% surge from the prior year. That capital didn’t evaporate. Much of it is sitting in SPVs, fund vehicles, and committed capital that will deploy once geopolitical clarity returns.
Infrastructure continues to improve. Saudi Arabia just issued its first open banking license to Lean Technologies. Egypt’s fintech sector is advancing digital onboarding and PSP licensing frameworks. Regulatory progress creates runway for the next wave of growth.
Sovereign wealth funds remain committed. QIA, Mubadala, and PIF participated in major rounds like WHOOP’s $575 million Series G at a $10.1 billion valuation. These funds operate on decade-long timelines. Short-term volatility doesn’t shift long-term thesis.
Exits are happening. Acquisitions continued through March despite the funding freeze, signalling that strategic buyers see value even when financial investors pause.
March was a shock. April will tell us if it was an anomaly or the start of a longer correction. Either way, the MENA ecosystem has survived worse. The infrastructure, talent, and capital commitments remain intact. This is a pause, not a collapse.
Read more here.
📰 Other News
MENA markets rally on ceasefire relief
The ceasefire announcement triggered one of the sharpest single-day rallies in MENA equity markets since the US-Israeli war against Iran began in February.
Tadawul’s benchmark TASI surged 2.3% to 11.3k points on April 8, marking a sharp reversal from weeks of volatility. Dubai’s DFM jumped 7%, Abu Dhabi’s ADX climbed 2.8%, and Egypt’s EGX 30 gained 4%, all fuelled by relief that the two-week ceasefire would prevent further military escalation.
Oil prices fell 16% to below $100 per barrel as traders unwound war-premium positions. Energy stocks took the hit: Saudi Aramco dropped roughly 2% while petrochemical names like Petro Rabigh and Yansab sold off 6.2% and 5.3% respectively. The “war premium” that had supported energy-heavy portfolios evaporated within hours.
Gains were led by sectors hammered during the conflict. Media surged 6.7%, utilities jumped 5.6%, insurance rose 4.7%, transport climbed 4.5%, and capital goods gained 4.4%. These are the high-beta sectors that suffered most during the freeze (tourism, aviation, real estate, logistics) all getting a relief bid.
The ceasefire is fragile. The two-week pause is meant to allow delegations to meet in Islamabad and negotiate a longer-term agreement, but trust is in short supply.
Investors aren’t convinced this is over. Portfolio managers at Thornburg Investments warned that “low visibility and limited predictability” on whether the truce holds means tail risks remain elevated. If the Strait of Hormuz stays closed for another two to four months, energy and commodity markets will remain structurally higher regardless of the ceasefire outcome.
The bigger question is what happens after the two-week pause. Iran is reportedly finalising a joint maritime protocol with Oman to institutionalise coordinated management of tanker traffic through the strait, which could embed Iranian authority over the crucial energy artery into a standing bilateral agreement.
For MENA markets, geopolitics is the unlock. De-escalation is needed to stabilise FX, compress risk premiums, and reopen the path for rate cuts. Until then, volatility remains the base case. The ceasefire offers relief, not resolution.
Read more here.
That’s all for this week, thanks! All of our MENA based readers: please stay safe. Sam