Middle East VC funding jumps by 89%, Saudi Arabia seizes largest share

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NOHA.GAD
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Jan 12, 2026
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Riyadh - Sharikat Mubasher: Total venture capital (VC) funding in the Middle East surged to $3.4 billion in 2025, marking an 89% year-on-year (YoY) increase, according to the ‘2025 State of Venture Capital Emerging Venture Markets FY 2025’ report released by MAGNiTT.

The region also posted the highest deal activity among emerging venture markets, with 581 deals, showing a 13% YoY rise.

Saudi Arabia recorded the strongest growth among the region’s most active countries, with funding soaring 145% YoY to $1.72 billion, strengthening its role as a scale engine. The UAE secured the second-largest share of VC funding at $1.57 billion across 231 deals.

Further, the Kingdom became MENA's most active market for the first time with 257 deals, marking a 45% YoY increase, driven by strong investment sentiment and government initiatives, notably Vision 2030.

By sector, fintech remained the most-funded industry in the Middle East, attracting $1.04 billion across 152 deals, followed by the e-commerce industry, which raised $494 million in VC funding.

Philip Bahoshy, CEO and Founder of MAGNiTT, commented: “Venture and broader private capital became more selective, and due diligence conversations have moved away from momentum towards fundamentals, scale, and clear paths to liquidity. In that environment, the Gulf Cooperation Council (GCC) region proved resilient and increasingly positioned itself as a destination for long-term capital. Throughout 2025, the region saw international investors from North America, Europe, and Asia continue to deepen their presence in the region across Private Capital. They were drawn by policy consistency, economic ambition, and sustained investment in infrastructure.”

He further noted that VC funding in the MENA region totaled $3.8 billion across 688 deals, a 74% increase along with a 6% rise in deal flow.


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