MENA startup funding surged 74% to $3.8 billion in 2025, outpacing Africa's growth

The Middle East and North Africa (MENA) startup ecosystem raised $3.80 billion across 688 deals in 2025, marking a 74% year-on-year increase in funding and a rare jump in deal volume among emerging markets. This contrasts with Africa's $3.24 billion total (up 44.6%), where deal counts actually decreased despite funding growth.

MENA's simultaneous growth in both capital and deal numbers indicates healthier ecosystem foundations, with liquidity reaching more founders across stages rather than just a few large checks to established players. This signals investors believe they can recycle capital sooner, evidenced by a 41% jump in mergers and acquisitions.

The surge stems from maturing policy environments. Tunisia's parliament amended financial laws in December 2025 to allow foreign currency accounts, easing international transactions for startups. The country's €100 million ($116 million) ANAVA Fund of Funds invested $4 million in Qatar's debt fund to channel more VC into Tunisia. Egypt's 2024 currency float eliminated parallel exchange rates that deterred foreign investors, while launching a $1 billion unified financing initiative for 5,000 startups and a Startup Charter targeting $5 billion in investments over five years. Morocco's Digital 2030 strategy gained traction alongside its $40 billion Investment Charter offering 30% subsidies for tech sectors.

Fintech remained top-funded in MENA ($1.15 billion, 178 deals) and captured 45% of African funding in H1 2025. AI funding in MENA tripled to $817 million, while Africa focuses on infrastructure—two-thirds of African countries now have data protection laws and expanding data centers.

For Nigerian startups, MENA's model shows policy reform works: Tunisia's currency reforms and Egypt's stability measures directly attracted capital. Will West African governments match these regulatory improvements to retain investors, or see funding migrate to better-structured MENA markets?

SOURCE: https://techcabal.com/2026/01/12/mena-venture-funding-deals-in-2025/