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Saudi Arabia tops emerging markets’ venture capital funding, overtakes Singapore 

Saudi Arabia captured 58 percent of all MENA venture funding and accounted for 41 percent of transactions, according to a new analysis. Shutterstock
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Updated 22 April 2025
Nour El-Shaeri
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Saudi Arabia tops emerging markets’ venture capital funding, overtakes Singapore 

Updated 22 April 2025
Nour El-Shaeri

RIYADH: Saudi Arabia has overtaken Singapore as the premier destination for venture capital funds across emerging markets after it secured $391 million in the first quarter of 2025.

The 53 percent year-on-year rise helped propel the Kingdom to becoming the highest-performing country across the Middle East, Africa, Pakistan, Turkiye, and Southeast Asia in terms of total funding during the three-month period, as revealed in the latest analysis by venture data platform MAGNiTT. 

While the standout $160 million series E round by fintech unicorn Tabby contributed significantly to the overall figure, the broader investment ecosystem showed resilience with non-MEGA deal funding, which are transactions below $100 million, rising 9 percent quarter-on-quarter. 

“This consistency signals a strengthening pipeline backed by sovereign LPs (limited partners) like SVC (Saudi Venture Capital), a growing cohort of accelerators, and successful exits like Rasan’s IPO (initial public offering),” according to MAGNiTT’s report. 

Saudi Arabia leads MENA funding and deal activity 

Saudi Arabia led the EVMs and continued its dominance in the Middle East and North Africa region. 

The Kingdom captured 58 percent of all MENA venture funding and accounted for 41 percent of transactions, far outpacing regional peers. 

According to MAGNiTT, the Kingdom achieved an 87 percent year-on-year increase in non-mega deal funding and a 437 percent rise in series A and B rounds, supported by sizable transactions such as those by Ula.me and Merit Incentives, each raising $28 million. 

The rise in Saudi venture capital investment comes amid a broader rebound in the MENA region. 

Total funding across MENA reached $678 million in the first quarter of 2025, a 58 percent increase year on year, despite a 21 percent decline in deal count to 133 transactions. 

The surge was supported by improved investor sentiment following late 2024 interest rate cuts across the Gulf, along with sustained sovereign fund activity and flagship ecosystem initiatives such as LEAP 2025. 

In terms of historical share, Saudi Arabia’s ascent has been significant. It expanded its share of MENA venture funding to 58 percent in the first quarter of the year, up from 39 percent in 2024 and 51 percent in 2023. 

This upward trajectory has positioned the Kingdom as the central engine of regional VC activity, reversing a period during which the UAE held the lead. 

The ecosystem shift also reflects a structural change in capital allocation. The first quarter saw non-mega deals rise for the fourth consecutive quarter, and early-stage investments in series A and B rounds increased by 50 percent quarter-on-quarter. 

In contrast, Southeast Asia reported its weakest early-stage quarter in seven years, with Singapore’s funding falling by 61 percent year on year to $377 million. 

The gap signals a shift in global investor preference as capital increasingly flows toward markets like Saudi Arabia, where macroeconomic stability, proactive policy, and institutional backing provide a conducive environment for venture growth. 

With 54 deals completed, the Kingdom reported the smallest year-on-year decline in deal count among the region’s top three markets, supported by a robust early-stage pipeline. 

Fintech dominates sector activity 

Fintech remained the most active and well-funded sector across MENA, particularly in Saudi Arabia, contributing 30 percent of all deals and capturing 57 percent of total regional funding. 

The sector saw a 362 percent year-on-year increase in funding, totaling $384 million, driven by Tabby’s $160 million MEGA round and strong underlying demand for digital finance solutions. 

Notably, 35 percent of all fintech deals in the first quarter of 2025 were in the $5 million to $20 million range, up 24 percentage points from the same period last year, demonstrating increasing maturity and scalability across the sector. 

Enterprise Software was the second most transacted and funded vertical, propelled by activity in Saudi Arabia and the UAE, accounting for 75 percent of all sector deals. 

Within this segment, the productivity apps sub-sector achieved record performance with six deals, including Merit Incentives’ $28 million and Qeen.ai’s $10 million rounds. The enterprise category posted a 112 percent annual growth in funding to reach $61 million. 

Saudi Arabia drives top-tier transactions and investor participation 

While deal volume across MENA dropped 21 percent year on year to just 133 transactions — one of the lowest quarterly figures in five years — Saudi Arabia defied the trend, maintaining strong early-stage momentum.

MAGNiTT noted that deal activity in the up to $1 million bracket declined 8 percentage points year on year to just 31 percent, while deals in the $5 million to $20 million and over $20 million brackets saw increases of 4 percentage points and 3 percentage points, respectively. 

This reallocation of capital reflects investors’ growing appetite for scale-ready startups in more advanced funding stages. 

Pre-seed to pre-series A activity in the Kingdom saw a 14 percent increase, highlighting the nation’s strengthening foundation for long-term growth. 

The shift in capital allocation patterns also reinforced Saudi Arabia’s strategic focus. 

The share of deals in the $1 million to $5 million range rose to 46 percent, the highest proportion in five years, mirroring a broader pivot across MENA toward larger, more scalable investment opportunities. 

Simultaneously, the lowest-value ticket size, $0 to $1 million, fell to 31 percent of deals, down 8 percentage points from the previous year. 

Five of the region’s 10 largest deals originated from the Kingdom, including Tabby’s round, the sole mega deal of the quarter, alongside significant rounds by Zension, with $30 million and Merit Incentives. 

According to MAGNiTT, this concentration of large-ticket transactions underscores the depth of investor confidence in the Saudi startup ecosystem.

Investor engagement in the Kingdom was also evident in the breakdown of top deals. The nation hosted more top-10 deals than any other MENA country, with fintech leading as the most represented industry. 

Blue Pool Capital and Hassana Investment Co. emerged as the most prominent backers, jointly deploying an estimated $53.3 million across key transactions, with fintech accounting for four of the top 10 deals. 

Exit environment strengthens on record M&A activity 

Saudi Arabia’s momentum was further underscored by a robust exit environment, with the MENA region recording 21 exits, up 163 percent year on year, marking the strongest quarter for mergers and acquisitions since MAGNiTT began tracking. 

The Kingdom’s IPO pipeline also improved, adding another layer of attractiveness to its startup ecosystem. 

While the regional rebound was attributed to easing inflation, improved liquidity, and pre-US tariff optimism, MAGNiTT emphasized that: “Saudi Arabia’s IPO and M&A momentum are now integral to the region’s exit environment.” 

Despite this surge, the median time to exit via M&A lengthened to six years, up from five in 2024, reflecting continued challenges for early-stage startup liquidity. 

Geopolitical risks introduce uncertainty to venture outlook 

Despite strong regional performance, MAGNiTT highlighted emerging risks that could disrupt momentum. 

“While Q1 2025 was a positive start to the year … that momentum is now under threat,” said Philip Bahoshy, CEO of MAGNiTT. 

He added that the new US tariff policies have created uncertainty in both the public and private markets over the last couple of weeks, which can create a challenge for decision-makers who are likely to be in a risk-off mindset.

“In venture capital, this uncertainty is likely to impact three areas: the deployment of capital from LPs to VCs, VCs’ willingness to make decisions in uncertain times, and finally, startups’ ability to raise funds,” said Bahoshy.

He noted that while global volatility persists, long-term fundamentals in EVMs remain strong. 

“Despite global headwinds, emerging venture markets continue to present compelling long-term opportunities. MENA, in particular, is uniquely positioned for sustained growth thanks to deep pools of local capital, pro-entrepreneurship policy, and active sovereign support,” Bahoshy added. 

“As global investors diversify beyond traditional markets, regions like MENA and Southeast Asia are poised to attract fresh capital — particularly in tech-led sectors that are strategically positioned and less exposed to tariff volatility,” the CEO said.

Topics: MAGNiTT VENTURE CAPITAL emerging markets

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Saudi Arabia pulls in most of Partners for Growth $450m capital push

Updated 07 February 2026
Nour El-Shaeri
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Saudi Arabia pulls in most of Partners for Growth $450m capital push

  • Global private credit fund leans into region’s largest market for growth-stage technology financing
Updated 07 February 2026
Nour El-Shaeri

RIYADH: Saudi Arabia has captured the vast majority of Partners for Growth’s capital deployed in the Gulf Cooperation Council, as the global private credit fund leans into what it sees as the region’s largest market for growth-stage technology financing. 

The San Francisco-based firm has deployed about $450 million in commitments in the GCC, and “the vast majority of that is in Saudi,” said Armineh Baghoomian, managing director at the firm who also serves as head of Europe, the Middle East and Africa and co-head of global fintech. 

The company was one of the earliest lenders to Saudi fintech unicorn Tabby, and it’s clear the Kingdom is providing fertile territory for ongoing investments.

“We don’t target a specific country because of some other mandate. It’s just a larger market in the region, so in the types of deals we’re doing, it ends up weighing heavily to Saudi Arabia,” Baghoomian said. 

Partners for Growth, which Baghoomian described as a global private credit fund focused on “growth debt solutions,” lends to emerging tech and innovation companies, particularly those that struggle to access traditional credit. 

“We’re going into our 22nd year,” she said, tracing the strategy back to its roots in a Bay Area investment bank debt practice in the mid-1980s. 

Today, the firm lends globally, she said, deploying capital where it sees fit across markets including Australia, New Zealand, and Southeast Asia, as well as Latin America and the GCC, where it has been active for about six years. 

Shariah structures dominate PFG’s Gulf deals 

In the Gulf, the firm’s structures are often shaped by local expectations. “Most of the deals we’ve done in the region are Shariah-compliant,” Baghoomian said. 

“In terms of dollars we’ve deployed, they’re Shariah-structured,” she added. 

“Usually it’s the entrepreneur who requires that, or requests it, and we’re happy to structure it,” Baghoomian said, adding that the firm also views Shariah structures as “a better security position in certain regions.” 

Growth debt steps in where banks cannot 

Baghoomian framed growth debt as a practical complement to equity for companies that have moved beyond the earliest stage but are not yet “bankable.” 

She said: “The lower-cost bank type facilities don’t exist. There’s that gap.”

Baghoomian added that companies want to grow, “but they don’t want to keep selling big chunks of equity. That implies giving up control and ownership.” 

For businesses with the fundamentals private credit providers look for, she said, debt can extend runway while limiting dilution. 

“As long as they have predictable revenue, clear unit economics, and the right assets that can be financed, this is a nice solution to continue their path,” she added. 

That role becomes more pronounced as equity becomes harder to raise at later stages, Baghoomian believes. 

She pointed to a gap that “might be widening” around “series B-plus” fundraising, as later-stage investors become “more discriminating” about which deals they back. 

Asset-heavy fintechs cannot scale on equity alone 

For asset-heavy technology businesses, Baghoomian argued, debt is not just an option but a necessity. 

She pointed to buy-now-pay-later platform Tabby as an example of a model built on funding working capital at scale. 

“Tabby is an asset-heavy business,” she said. “They’re providing installment plans to consumers, but they still need to pay the merchant on day one. That’s capital-intensive. You need a lot of cash to do that.” 

Equity alone, she added, would be structurally inefficient. “You would not want to just raise equity. The founders, employees, everyone would own nothing and lose a lot of control.” 

We don’t target a specific country because of some other mandate. It’s just a larger market in the region, so in the types of deals we’re doing, it ends up weighing heavily to Saudi Arabia.

Armineh Baghoomian, PFG managing director and head of Europe, the Middle East and Africa and co-head of global fintech

Baghoomian said those dynamics are common across other asset-intensive models, including lending platforms and businesses that trade in large inventories such as vehicles or property. “Those are businesses that inherently end up having to raise quite a bit of credit,” she said. Partners for Growth’s relationship with Tabby also reflects how early the firm can deploy capital when the structure is asset-backed. “We started with Tabby with $10 million after their seed round, and then we grew, and we continue to be a lender to them,” Baghoomian said. 

“On the asset-backed side, we can go in quite early,” she said. “Most of the fintechs we work with are very early stage, post-seed, and then we’ll grow with them for as long as possible.” 

As the market for private credit expands in the Gulf, Baghoomian emphasized discipline — both for lenders and borrowers. 

For investors assessing startups seeking debt, she said the key is revenue quality and predictability, not just topline growth. “Revenue is one thing, but how predictable is it? How consistent is it? Is it growing?” she said. “This credit is not permanent capital. You have to pay it back. There’s a servicing element to it.” 

Her advice to founders was more blunt: stress-test the downside before taking leverage. 

“You have to do a stress test and ask: if growth slows by 30 to 40 percent, can I still service the debt? Can I still pay back what I’ve taken?” she said. 

Baghoomian warned against chasing the biggest facility on offer. “Sometimes companies compete on how much a lender is providing them,” she said. “We try to teach founders: take as much as you need, but not as much as you can. You have to pay that back.” 

Partners for Growth positions itself as an alternative to banks not only because many growth-stage companies cannot access bank financing, but because it can tailor structures to each business. 

HIGHLIGHTS

• Partners for Growth positions itself as an alternative to banks not only because many growth-stage companies cannot access bank financing, but because it can tailor structures to each business.

• The firm lends globally deploying capital where it sees fit across markets including Australia, New Zealand, and Southeast Asia, as well as Latin America and the GCC, where it has been active for about six years.

One of Partners for Growth’s differentiators, Baghoomian said, is how bespoke its financing is compared with bank products. 

“These facilities are very bespoke. They’re custom to each company and how they need to use the money,” she said, adding that the fund is not offering founders a rigid menu of standardized options. 

“No two deals of ours look alike,” she said, framing that flexibility as especially important at the growth stage, when business needs can shift quickly. 

That customization, she added, extends beyond signing. Baghoomian said the firm aims to structure facilities so companies can actually deploy capital without being constrained, adding: “We don’t want to handcuff you. We don’t want to constrain you in any way.” 

As a company evolves, she said the financing can evolve too, because what works on day one often won’t fit nine months later. 

“We’ll revise structures,” she said, describing flexibility as core to how private credit can serve fast-moving tech businesses. 

She added that a global lender can also bring operating support and market pattern recognition, while still accounting for local nuance. 

Baghoomian expects demand for private credit in the Gulf to keep rising. “They are going to require credit, for sure,” she said, pointing to the scale of new platforms and projects. 

“I don’t see it shrinking,” she said, adding that Partners for Growth is seeing more demand and is in late-stage discussions with several companies, though she declined to name them. 

PFG to stay selective despite rising competition 

Competition among lenders has increased since the firm began deploying in the region, Baghoomian said, calling that “very healthy for the ecosystem.” 

Most of what the firm does in the region is asset-backed, Baghoomian said, often through first warehouse facilities for businesses financing receivables or other tangible exposures, “almost always Shariah.” 

Keeping Egypt on its watchlist 

Beyond the Gulf, Baghoomian said the firm is monitoring Egypt closely, though macroeconomic volatility has delayed deployments. 

“We looked at Egypt very aggressively a few years ago, and then the macro issues changed,” she said, adding that the firm continues to speak with companies in the country and track conditions. 

Even as private credit becomes more common in the region, Baghoomian underscored that debt is not universally appropriate. 

“Not every company should take a loan or credit,” she said. “You don’t take it just to take it. It should be getting you to the next milestone.” 

Topics: Partners for Growth Saudi Arabia

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