International investors are increasingly interested in MENA startups

International investor interest in the MENA startups is heating up: MENA startups have witnessed a surge in international investor activity in 9M 2024, with the region’s 28% y-o-y increase in unique investors positioning it as the fastest growing arena for international venture capital across Southeast Asia, Africa, and the Middle East during the first nine months of the year, according to Magnitt’s latest International Investor Evolution Report.

The broad strokes: The MENA region’s overall growth in investor activity was driven by a 60% y-o-y increase in international investors in the region’s startups — particularly those from the US and UK, the report writes. International venture capitalists also doubled their capital share in the region during 9M 2024 compared to the same period last year, reaching 37% of deployed capital. The growth was also driven by higher interest investing in early-stage startups, with series A transactions capturing 50% of international capital share in 9M 2024, up from just 15% in 9M 2023. Moreover, the MENA region has seen international venture capitalists’ share of participation rise from 28% in 2020 to 51% in 2024, according to a separate Magnitt press release (pdf).

Within the region, Egypt and the UAE led this investor influx: Egypt saw a 32% y-o-y increase in unique investors in 9M 2024, underpinned by a 79% y-o-y rise in local venture capitalists and significant contributions from the UK. The UAE also made significant strides in attracting international venture capital, with the report noting that the UAE saw a 24% y-o-y increase in unique investors during 9M 2024 — largely driven by a doubling of US-based participants.

Despite recent gains, the region continues to lag behind on aggregate: Recent progress notwithstanding, MENA startups continue to lag behind Southeast Asia and Africa in terms of total venture capital deployed, with the region registering USD 947 mn in deployed capital to Africa’s USD 1.2 bn and Southeast Asia’s USD 11.7 bn in 9M 2024.

MARKETS THIS MORNING-

Asian markets are kicking the day off in the green during early trading this morning, with Japan’s Nikkei up 0.5%, followed by Hong Kong’s Hang Seng and Korea’s Kospi both at 0.3%. Over in China, the Shanghai index is down 0.4%.

THE CLOSING BELL-

The DFM fell 0.6% yesterday on turnover of AED 476.2 mn. The index is up 16.1% YTD.

In the green: National International Holding Company (+3.1%), Amanat Holdings (+2.8%) and Emaar Properties (+1.9%).

In the red: Takaful Emarat - Rights Issue 2024 (-10%), Emirates Investment Bank (-9.7%) and Gulf Navigation Holding (-7.0%).

Over on the ADX, the index fell 0.6% on turnover of AED 1.8 bn. Meanwhile, Nasdaq Dubai closed up 0.5%.

CORPORATE ACTIONS-

Americana Restaurants completed the repurchase of 25 mn of its own shares from the open market, at an average price of AED 2.460 per share, according to an ADX filing (pdf). These shares will be allocated to eligible employees under the company’s long-term incentive program.

Background: In August, Americana Restaurants International secured ADX approval to repurchase 25 mn of its own shares. The company initially repurchased 1.25 mn shares in the same month, with plans to buy back another 23.75 shares.

ADX-listed crypto miner Phoenix Group’s founders plan to repurchase the company’s shares from the open market in a bid to enhance shareholder value, according to an ADX disclosure (pdf). The number of shares and their nominal value were not specified.

Space42 appointed Q Market Makers as liquidity provider for its listed shares on ADX, according to a bourse disclosure (pdf).