Following its record-breaking performance in 2023, Saudi Arabia remained the region’s most funded country in Q1 2024 with investments reaching $240 million. The latest ‘Q1 2024 KSA Venture Investment Report’ from MAGNiTT reveals that despite the 70 percent quarterly decline and the 42 percent annual decline in investments, Saudi Arabia’s performance reflected the overall market trends in the Middle East and North Africa (MENA) region.
Deal flow remains resilient
While funding saw a decline, deal flow in Saudi Arabia remained resilient. The country reported 35 deals in Q1 of 2024, remaining stable compared to Q4 of 2023 and marking a 13 percent decline annually. Notably, the top 10 deals by amount in Saudi Arabia accounted for 85 percent of the total capital deployed during Q1 of 2024. The report also highlights that the decline in funding outpaced the decline in deal flow, highlighting smaller ticket sizes on average.
During the first quarter of 2024, Saudi Arabia’s Salla app $130 million deal accounted for a remarkable 54 percent of total funding in the country. This deal made Saudi Arabia the only MENA country to witness a mega-deal investment in 2024.
In addition, Saudi Arabia’s investments, which reached $240 million, accounted for 65 percent of the MENA region’s overall total capital deployed in Q1 of 2024.
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E-commerce and retail sector
The e-commerce and retail sector retained its position as the leading industry in Saudi Arabia’s venture landscape, driven by Salla’s mega-deal. However, fintech emerged as the most transacted industry in Saudi Arabia and the overall MENA region, including the UAE and Egypt.
Despite lower funding levels, investor participation in Saudi Arabia saw a 5 percent annual increase in Q1 of 2024. The report also highlights a notable increase in the share of Saudi-based investors since 2023.
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