Startups across the Middle East and North Africa raised a combined 172.6 million dollars across 45 deals in July 2026, according to a monthly report released by Wamda. The figure marks a 16 percent increase compared to June, though it remains 78 percent below the total recorded in July of the previous year, pointing to a market that is recovering gradually from a broader slowdown rather than returning to its earlier funding levels.
The composition of that capital tells a more significant story than the headline number itself. Debt financing accounted for 56 percent of the total funding raised during the month, a sharp rise from just 11.5 percent the previous month and only 2 percent a year earlier. Equity investment, by contrast, continued to lag behind, suggesting that startups and investors across the region are increasingly turning to debt instruments to bridge funding needs at a time when traditional equity rounds have become harder to close. This shift reflects a broader trend across emerging startup ecosystems, where debt financing often becomes more prominent when equity investors grow more selective or valuations come under pressure.
Saudi Arabia led the region in July, with startups in the Kingdom securing 106.6 million dollars across 16 deals, representing nearly 62 percent of all capital raised across the MENA region during the month. The UAE followed with the same number of transactions but attracted a smaller total of 46.6 million dollars, underscoring a divergence in deal sizes between the two markets even as both recorded an identical number of individual transactions. The concentration of capital in Saudi Arabia continues a pattern seen in recent months, with the Kingdom consistently accounting for a large share of regional funding activity relative to other markets in the region.
No mega deals or late stage funding rounds were recorded during July, leaving early stage startups to dominate both the total value and volume of transactions completed during the month. This absence of large, late stage rounds means the month’s funding activity was shaped almost entirely by smaller, earlier stage deals, a pattern that offers a clearer read on where investor appetite currently sits within the region. Rather than being distorted by a handful of large transactions, July’s numbers reflect a market that remains selective, weighted toward early stage activity, and increasingly reliant on debt for funding needs beyond the seed stage.
Taken together, the shift toward debt financing and the concentration of capital in early stage deals point to a MENA funding environment still finding its footing after a period of contraction. Saudi Arabia’s continued dominance in deal value, paired with the near total absence of late stage rounds across the region, suggests that investors are prioritising smaller, more contained bets over larger commitments for now, a pattern likely to remain a defining feature of the region’s funding activity in the months ahead.
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