Startups in the MENA region have witnessed a lot of attraction recently. Many of them have been internationally recognized and acquired by major companies reflecting a robust startup ecosystem in the region.
This startup ecosystem holds a lot of importance for a region that has been on the rungs of employability of its youth and is seeking to shift from an oil-based economy.
In such a situation, startups become the knight in shining armor for not only the youth but also determine the future of the region through its economic standing. Thus, a lot of importance has been laid, and trends have been followed to tap into the relevance of these startups in the market.
In this article, KiwiTech aims to provide insights into the new trends followed by startups in the MENA region.
Any international business cannot address issues relevant to a region with multiple geographical and demographic pain points. In such a situation, regional startups enjoy the advantage of knowing ground-level problems with innovative solutions.
Startups are seen as a catalyst for innovation. The digitalization of the MENA region owes a lot to these innovative startups that generally have young people with a high level of digital connectivity at their topmost level.
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Innovation as its motive boosts startups’ chances of taking over by incumbent businesses. It further strengthens the startup ecosystem in the region by combining monetary resources with new and innovative ideas. It provides dual benefits to the investors to fulfill the socio-economic responsibility and tap into new, fresh ideas.
“World Economic Forum’s Regional Business Council (RBC), which includes some of the leading businesses in the region, are pledging to allocate 10% of their annual procurement budget to SMEs, startups, and entrepreneurs by 2020.”
MENA-based startups are also witnessing international interest, especially those aiming to provide solutions to Pandemic brought problems. The sectors most benefit from the high investment are Fintech, eCommerce, and healthcare, with a strong founding team and proven problem-solving capabilities.
In addition to this, the return of in-person events such as GITEX and Expo 2020 will accelerate program activity. With the reignition of founders’ cross-border activity to scale up, the growth trajectory of the startup ecosystem is looking highly encouraging, according to Philip Bahoshy, CEO and founder of MAGNiTT.
Although, along with the world, the MENA region witnessed a halt in its operations due to Covid-19 restrictions. Yet, it gave birth to newer platforms and infrastructure for startups through digital transformation. Multiple startups rose to heights in the Pandemic itself through the re-prioritization of industries according to their relevance in the COVID-19 crisis.
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The region’s government has made conscious efforts to provide the right environment and infrastructure for startups in the area to flourish. It reduced the cost of setting up a startup; it supported the ability to scale and incentivized access to capital. These structural changes in the policy provided guidance, connectivity, and funding facilities to the startups in their pre-seed and seed stages.
Government-run accelerator Falak invested in early-stage startups and was established to give the startup industry in the country a much-needed shot in the arm.
Startups’ progress in the MENA region has been progressive for over a decade. Despite the Covid 19 obstruction, the region has had multiple flourishing startups that have emerged as unicorns, showcasing how promising these startups are.
Taking these trends further, KiwiTech has successfully helped startups in the MENA region scale and add to the ever-growing startup economy in the region. If you’re a MENA-based entrepreneur looking to learn more about how KiwiTech supports and accelerates businesses in the area, feel free to contact us. We would love to tell you more!