In 2024, the Middle East and North Africa regions saw Saudi Arabia solidify its position as a leader in venture capital funding amidst a challenging global environment. With a remarkable acquisition of $750 million in capital, Saudi Arabia accounted for a substantial 40% share of the total venture capital deployments in the MENA region. This success marks the second consecutive year that the Kingdom has maintained its dominance in the regional venture capital rankings, as reported by the prominent regional venture platform MAGNiTT.

A significant highlight of Saudi Arabia's success was the major deal secured by Salla, a Saudi-based e-commerce enablement platform, which raised an impressive $130 million. The Kingdom's total of 178 deals was the highest recorded in the MENA region, indicative of strong investor confidence and an ever-thriving startup ecosystem within the country. This development places Saudi Arabia at the forefront of venture capital activity in an emerging market environment where many regions faced a notable decline in investments.

The regional venture landscape did not fare as well collectively. MENA startups attracted $1.9 billion in 2024, reflecting a significant 29% decrease compared to the previous year. This downturn aligned with a broader global trend of reduced venture capital funding activity seen over the last two years, particularly affecting regions outside of the AI sector. Southeast Asia, for instance, experienced a dramatic 45% decline, while Africa saw a 44% decrease in funding.

The global venture ecosystem, including emerging markets like MENA, Africa, Southeast Asia, Pakistan, and Turkiye, grappled with a 40% reduction in total VC activity. The number of deals also fell by 20% from the previous year, taking them below the levels recorded in 2020. Despite these declines, MAGNiTT's report highlighted some green shoots of potential recovery, especially with the Middle East markets achieving a 10% rise in total deal volume and a 14% increase in active investors, totaling 475 by the year's end.

Venture capitalists signaled a preference shift toward early-stage investments, with 47% of all investments within the $1 million to $5 million range, which had increased by seven percentage points. This focus demonstrates an evolving strategy to sustain future deal flow and investment ecosystem resilience despite slumping late-stage funding activities globally.

Southeast Asia led with a wider share of total deal activities at 43%, whereas Africa's market dropped substantially to 22%—its five-year low. Nevertheless, fintech remained a powerhouse in the venture capital space across emerging markets, accumulating $3.9 billion throughout 2024. Mynt, a Philippines-based fintech entity, notably stood out by raising $786 million, the largest among fintech deals.

The prospect of favorable macroeconomic changes such as declining global interest rates brought forth cautious optimism for increased venture capital access in 2025, as highlighted by MAGNiTT CEO Philip Bahoshy. These anticipated economic shifts, including strategic partnerships formed by sovereign wealth funds and international VCs, are geared towards enhancing the Middle East's strategic role in the global venture ecosystem. The region is projected to attract significant attention, boosting investor interest and financial inflow through developed expertise and localized value-driven initiatives.

In spite of the hurdles presented by the global downturn, the MENA region and other emergent financial ecosystems continue to forge new opportunities within the venture space. While Saudi Arabia's market reflects a burgeoning potential within MENA, the broader narrative emphasizes a region and world cautiously navigating toward economic stabilization and venture capital revivification.