Startup funding in the Middle East and North Africa (MENA) region fell to US$127.5 million in March. This marks a 76% decline from February’s US$530 million across 28 deals.

This decrease reflects global economic uncertainty, influenced by US trade tensions and other geopolitical factors, according to Wamda’s latest report.

Despite the slowdown in March, MENA startups raised US$1.5 billion in the first quarter, a 244% increase compared to the same period in 2024.

Fintech was the top-performing sector in March, raising US$82.5 million across 10 deals and over US$1 billion in the first quarter alone.

🔗 Source: Arab News

🧠 Food for thought

1️⃣ Fintech’s dominance continues a five-year investment pattern in MENA

The March 2025 data showing fintech capturing $82.5 million (65% of total funding) follows a long-established pattern in the region’s investment landscape.

Fintech has been the leading sector for investment in MENA since 2017, when it first surpassed e-commerce and logistics in deal volume according to historical MAGNiTT data 1.

The sector’s first-quarter performance of over $1 billion across 36 startups demonstrates exceptional growth from 2019 levels, when MENA fintech startups had attracted just $237 million across 181 deals over a five-year period 1.

This concentration in fintech aligns with regional market conditions, where rapid internet penetration, favorable demographics, and a large unbanked population create natural demand for innovative financial solutions.

The continued investor confidence in fintech amid broader funding declines suggests the sector remains viewed as more resilient to economic headwinds than others like SaaS, which failed to secure any funding for the second consecutive month.

2️⃣ MENA venture funding shows remarkable resilience despite growing global tensions

While March 2025 saw a sharp monthly decline, the quarterly context reveals MENA’s venture ecosystem is maintaining impressive momentum amid challenging global conditions.

The region’s startups raised $1.5 billion in Q1 2025—a 244% year-over-year increase—continuing a trend where MENA venture funding has grown to 4.3 times its pre-pandemic levels, significantly outpacing global markets 2.

This growth contrasts with mature markets like the US and UK that have experienced stagnant or declining funding levels during the same period, suggesting MENA’s venture ecosystem has developed unique resilience 2.