The platform “Magnit” has revealed that the United Arab Emirates has captured the largest share of venture capital funding in the Middle East, achieving unprecedented levels during 2025. This surge is attributed to a wave of global capital flowing into the region, enabling it to defy the downturn in fundraising seen in other emerging markets.
According to data from “Magnit,” startups in the region secured funding amounting to $3.8 billion across 688 transactions in 2025, marking a remarkable increase of 74% from the previous year.
The data platform reported that nearly half of the venture capital investments in the region during the year came from international investors, representing a record level of cross-border participation.
In this context, Philip Bahoush, CEO of “Magnit,” stated: “While some emerging market sectors faced a contraction in both funding and deal flow this year, the Middle East and North Africa managed to expand their share of total funding in emerging markets, solidifying their position as an attractive destination for global private capital worldwide.”
International companies have been expanding their presence in the region, driven by the appeal of high-liquidity sovereign wealth funds and the increasing volume of anticipated deals. Firms like “General Atlantic” and “Permira” are among those enhancing their regional footprint by investing venture capital locally.
The fintech sector emerged as the most active, attracting $1.15 billion through 178 deals. Notably, the largest funding rounds saw the Dubai-based company “Expansio,” specializing in night vision contact lenses, reach unicorn status after securing $250 million. Artificial intelligence also took center stage, with the Abu Dhabi-based group “G42” leading a funding round for “Applied AI.”
Venture capital investors anticipate that mergers and acquisitions will account for an increasing share of exit deals in major markets. Bahoush concluded by predicting that 2026 will be a significant year for exits through mergers and acquisitions and initial public offerings, as global startups are increasingly drawn to establish headquarters in the region to expand into new markets.