2015 Winners: MENA Startups That Raked in the Money

One of the biggest challenges that entrepreneurs in the Middle East face is securing funding for their ventures, especially during the early stages. While the funding ecosystem for angel investments continues to develop, some established entrepreneurs have done very well in this regard.


In 2015, two companies achieved fundraising rounds of $100 million, and many more startups received eight-digit funding. The following deals, which point to the growing availability of serious startup funding in the region, are some of the most exciting startup funding successes in the Middle East last year:

  1. Hellofood—Last May, the global online food delivery startup Hellofood (also known as Foodpanda) raised $100 million in its second round with a major investment from Goldman Sachs. The company also secured $110 million from a group of investors earlier in the year, including a large investment from Rocket Internet, an e-commerce group based in Germany. With more than $200 million raised in 2015, Hellofood was able to acquire talabat.com and 24h.ae, two other food delivery platforms in the Middle East, to limit competition.
  1. Deliveroo—A United Kingdom-based startup, Deliveroo debuted in the United Arab Emirates in late 2015 after raising $100 million in Series D funding. Major investors included the Russian firm DST Global and Greenoaks Capital, based in America. Also contributing to the funding round were several existing investors, such as Accel, Index Ventures, and Hummingbird Ventures.
  1. Fetchr—Founded in Dubai, Fetchr raised $11 million from an American investor this year during its Series A round. The delivery service has shown that foreign investors are beginning to notice promising Middle Eastern startups and becoming confident enough in the region’s future to make major investments. Fetchr’s largest investor is the venture capitalist firm New Enterprise Associates.
  1. Careem—Last year, Careem earned a lot of attention as the Middle East’s answer to Uber. During its Series C funding round, Careem secured $60 million, mostly from investors based in the Middle East. These firms include the Abraaj Group, Al Tayyar, STC Ventures, BECO Capital, and Arzan Venture Capital, as well as Impulse, a Kuwait Investment Authority subsidiary. Lumia Capital and Wamda Capital also contributed to the round.
  1. littleBits—In Summer 2015, littleBits, an electronics startup based in the United Arab Emirates, announced a $44.2 million round of funding led by DFJ Growth, a firm that also invested in Box, SpaceX, and Tesla. Other investors included Grishin Robotics, Wamda Capital, and Morgan Stanley Alternative Investment Partners.

Other Noteworthy Mentions

Outside of these five major deals, a number of other funding rounds for Middle Eastern startups in 2015 are notable. Jamalon, for example, raised $3.65 million through Wamda Capital, Arzan VC, and the Saudi firm Al Qudrah. Emirati startup JadoPado raised $4 million during its Series A round. As a result, the startup’s valuation has risen to $28 million. This round was JadoPado’s first attempt at external funding after direct cash injections from Al Bogari Holdings.

In Turkey, Islamic fashion e-commerce website Modanisa raised $5.5 million with significant investments coming from the Saudi telecom venture capital fund STC Ventures and Aslanoba Capital, a firm controlled on behalf of Turkish angel investor Hasan Aslanoba. In November 2015, ArabiaWeather closed the year with a round of funding that totaled $5 million. The round was led by Badia Impact Fund and Wamda Capital, but DASH Ventures and the Jabbar Internet Group were also large contributors. ArabiaWeather had raised more than $2 million in its previous round at the end of 2014.

Looking Forward to the Future of Middle Eastern Entrepreneurship

These impressive funding rounds point to both the level of innovation taking place among Middle East startups and the willingness of local and foreign investors to take a chance on the region. At present, nearly 40 venture capital firms are active in the region and 2015 saw the inception of Leap Ventures, a $71 million fund, and Wamda Capital, which manages $75 million.

meetingThe chances of securing funding in the Middle East have increased dramatically, even from only a year ago. The region has also witnessed a new push for angel investments, which can fuel success by teaming promising companies with knowledgeable and experienced business leaders who have a personal stake in a fledgling company. The increasing availability of angel investors will naturally address the longstanding need for more early-stage funding.

As the Middle Eastern startup ecosystem continues to expand, however, it becomes important to ask what the final aim of these funded companies is and how those goals will affect the future of the ecosystem. For the Middle East, an IPO seems a rather unlikely exit strategy. The majority of companies are instead hoping to be acquired by larger companies. This exit strategy limits the value of employee equity, which has proven a major motivator for innovation in other entrepreneurial ecosystems. For the Middle East to continue its economic development, it needs to find a way to invest in its talent and reward hard work.

For a long time, access to funding has been the major concern of people trying to develop the Middle East startup ecosystem. Now that funding is becoming less of a hurdle, it is time to turn attention to other issues, such as developing the talented workforce that already exists in the region.