MENA VC funds sit on USD 1.5 bn as deployment lags

MENA-focused venture funds are sitting on an estimated USD 1.45 bn in dry powder — capital committed but not yet deployed — according to a Magnitt report seen by EnterpriseAM. That's 88% of the USD 1.64 bn raised across 17 funds since 2024, or put another way, nearly nine of every ten USD committed to the funds raised since 2024 is still on the sidelines.

The pile reflects how early these funds are. Venture funds typically deploy over five to seven years, and 10 of the 17 identified funds have committed less than 10% of their target, leaving more than 90% available. Of the USD 1.64 bn committed, only USD 197 mn had been deployed by 1H 2026.

What has gone out has concentrated in the established markets. Saudi Arabia drew the largest share across all three launch years, ahead of the UAE and Egypt. Of the USD 60 mn that 2026-launched funds deployed in 1H, USD 33 mn went to Saudi startups and USD 7 mn to the UAE, with USD 20 mn spread across other MENA markets.

The largest funds skew toward the UAE. BECO Capital's Booster Growth Fund I leads at USD 250 mn in target size over the 2024-1H 2026 period, followed by Shorooq Partners' Late Stage Growth Fund at USD 200 mn and Oman's Jasoor Fund at USD 180 mn. Four of the 17 funds carry an explicit AI mandate.

The largest individual funds skew toward the UAE, however. BECO Capital's Booster Growth Fund I leads at USD 250 mn in target size across the 2024-1H 2026 period, followed by Shorooq Partners' Late Stage Growth Fund at USD 200 mn and Oman's Jasoor Fund at USD 180 mn. Four of the 17 funds carry an explicit AI mandate.

The pool has grown fast. Six active funds in 2024 held a combined USD 572 mn, only USD 42 mn of it deployed. By 2025, the cumulative count reached 14 funds targeting USD 1.28 bn, 89% still undeployed. Three more funds in 1H 2026 added USD 370 mn, all of it dry powder, taking the combined target above USD 1.6 bn.

Don’t read the 2026 funds as war-proof, though. Magnitt cautions that the three funds added this year, despite the US-Iran war and the Houthi threats, likely reflect fundraising processes started before the conflict. On its assumed six-to-nine-month transmission lag, Magnitt sees the war's real effect on new fund formation surfacing in 2H 2026 and early 2027.

Why it matters: A USD 1.45 bn pool sounds like a cushion, but dry powder only counts once it's deployed. Whether it meets the region's funding needs depends on pace, mandates, risk appetite, and how well the capital matches founders' stage and geography, and on whether the war chokes off the next wave of fundraising before this one is spent.

MARKETS THIS MORNING-

Asian markets are trading mixed this morning, with the Shanghai Composite up 0.2%, Japan’s Nikkei nearly flat, and Hong Kong’s Hang Seng down 0.2%. Meanwhile, Wall Street futures are blinking green on positive earnings from Nvidia.

THE CLOSING BELL-

The DFM rose 0.6% yesterday on turnover of AED 728.6 mn. The index is down 3% YTD.

In the green: National International Holding (+9%), Alec Holdings (+7.9%), and Shuaa Capital (+3.8%).

In the red: National Cement Company (-5%), Dubai Refreshment (-5%), and BHM Capital (-4.7%).

Over on the ADX, the index fell 0.3% on turnover of AED 1.1 bn. Meanwhile, Nasdaq Dubai rose 0.1%.