Tech companies in the Middle-East and North Africa raised more than $1 billion in venture capital financing last year. While the amount is higher than that raised a year previously, the number of transactions fell by 13% YoY to 496. The figures were provided in a recent report by Magnitt.

Philip Bahoshy, Founder and MD of Magnitt, said 2020 has been a tipping point for venture capital-backed startups in the Mena region. “Covid-19 rapidly accelerated the adoption of technology across emerging markets, creating larger markets and more opportunities to scale,” he said.

Financings were mobilized at a time when covid-19 was rapidly spreading in several major economies in North Africa and the Middle East. As a result, investments have increased further in the food, beverage, and health sectors, the document says.

This increase in financing in the Mena zone, despite the crisis, is an indicator of the appetite of local and foreign investors for African and Middle Eastern tech companies. Investors, motivated by more attractive returns and gains from their investments, are focusing more on flexible startups capable of turning the challenges of the crisis into business opportunities and generating attractive capital gains, especially in sectors vital to households and businesses.

Chamberline MOKO