Brazil350 MENA startups to hit or near $1 billion unicorn valuation by 2030
By 2030, it is anticipated that the MENA region will spawn more than 300 unicorns, startups that have a valuation of over $1 billion, and soonicorns, startups that are forecast to reach that valuation.
Currently home to just 6 startups with a valuation of above $1 billion, the number of unicorns and soonicorns headquartered in the MENA region is predicted to rise sharply. That is according to an analysis by strategy consulting firm Redseer, which found that the current 45 companies that are expected to exceeded $1 billion will likely balloon to around 250 by 2030.
According to Redseer, the majority of these highly successful startups and scaleups will be centered in sectors including e-commerce, technology, internet, financial services and fintech, and consumer services.
“The post-pandemic digital economy has seen the rise of emerging sectors including HealthTech, EdTech and FinTech,” said Sandeep Ganediwalla, managing partner at Redseer in the Middle East. He added that “regulation and government initiatives across MENA will unlock investments and drive growth, with future growth arriving from hinterlands.”
Many of the coming unicorns and soonicorns will turn to IPOs for mass funding, as companies grow beyond the funding requirements typically offered by venture capitalists and early stage private equity funds.
Young companies will according to Redseer make up a growing share of the MENA’s public listings market, which saw 51 IPOs in 2022, with a total of around $22 billion raised. Major IPOs are expected in the region this year, said EY in a recent report, with some companies already having announced their plans to go public in 2023.
An overview of the largest startups to surpass a value of $1 billion in the MENA region:
Careem
Ride-hailing company Careem became the Middle East’s first unicorn during a 2016 funding round in which it was valued at around $1 billion. Purchased by Uber in 2020 for $3.1 billion, the company provides its services to users in over 100 cities in the Middle East, Africa, and in Turkey and Pakistan.
Headquartered in Dubai, Careem was started by two former McKinsey & Company management consultants: Mudassir Sheikha, a Pakistani-American, and Magnus Olsson, originally from Sweden.
Prior to joining Uber, Careem acquired several other MENA startups during its growth journey. In 2018, it acquired RoundMenu, a food ordering platform that operates in several countries in the Arab world, and in 2021, UAE bike-sharing startup Cycle was purchased.
Swvl
Another startup focused on mobility, Swvl helps end users book public transportation tickets using algorithms to calculate the most convenient options available in their location. Founded in Egypt in 2017, the app moved its headquarters to Dubai in 2019. They received a $500,000 investment from Careem soon after being founded. Swvl CEO Mostafa Kandil previously worked for Careem.
Swvl operates in around 135 cities in the Middle East, Africa, Asia, and Latin America. It was, at $1.5 billion, the largest Middle East-based unicorn to go public on the Nasdaq. Since then however, the company has been facing financial issues, with 32% of its workforce being laid off in May 2022 and a 96% drop in stocks in less than a year since its IPO.
Kitopi
Dubai-headquartered Kitopi offers a cloud-kitchen platform to over 200 kitchens in 5 countries in the Middle East. The company created a proprietary suite of applications designed to optimize kitchens, which “ensures speed and across the business,” according to Kitopi’s website.
Kitopi became a unicorn after a Series C funding round raised $415 million, one of the largest ever in the MENA region. Kitopi was placed first on the 50 Most-Funded Startups for 2021 by Forbes Middle East.
Fawry
An Egyptian FinTech leader, Fawry was founded in 2008, and offers both B2B and B2C digital payment products. The company processes around 3.4 million daily transactions and serves 45 million users.
Fawry’s B2C service allows users to pay bills, pay traffic penalties, and complete other operations like renewing driver’s licenses. In February 2023, the company made a deal with Emirati calling app BOTIM to enable easier money transfers from the UAE to Egypt.
