SVB's Impact on Venture Financing Across The Region

🌤️ It's nice gloomy weather over here in Dubai today, but if it isn't your cup of tea then fear not, we're here to shed some light (on VC data & insights of course).

🎙️ The past week has all been about the crisis at the Silicon Valley Bank, the 16th largest bank in the US. MAGNiTT's Founder & CEO Philip Bahoshy was recently on The Business Breakfast to discuss the impact of the recent events on the region’s tech ecosystem and how local banks can better support venture-backed startups.

⌛ The collapse of Silicon Valley Bank (SVB) has caused panic among those who had banked with them. For our region, the immediate impact hasn’t been as acute as it was in the US because a lot of the companies are operating at a local level, for instance, in the UAE, Saudi Arabia, and Egypt, and would have likely had some cash in the accounts here.

🤔 The real challenge is that the collapse of SVB is likely going to affect the confidence in the sector, creating risk aversion and a lack of risk appetite as people take a step back to view the wider macroeconomic level and how that's going to impact the VC space.

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📊 Insights & Data of The Week:

Increasing participation of East and Southeast Asian investors in MEAPT: 

Our latest research brief dwells on the increased activity of East and South-East Asian investors in MEAPT, and the leading players by the number of deals. 

Reach out to our team to make a customizable Market Map for your research!

CVCs embark on increasing participation in the startup ecosystem:

Big corporations see value in investing in startups. We track the increase in corporate venture capital (CVC) in emerging markets and what it means for startups and investing companies. 

Interestingly the space in MENA is mostly dominated by regional corporate venture capitalists. Almost 70% of the total CVCs that backed MENA-based startups last year hailed from the region itself.

The best-performing round size in Saudi Arabia:

Saudi Arabia continued the funding share pattern seen throughout the post-pandemic era as the country’s growing ecosystem continued to focus on early-stage funding with bigger ticket sizes retaining $1M-$5M as the most valued round size. 

This trend is contrary to the image seen so far in the MENA region and peer countries.

2022 was a challenging year for global and the Emerging Venture Markets and venture capital activity saw a mix of trends as funding neared the highs seen over 2021.

On the other hand, the number of deals retreated, whereas exits catapulted in the MEAPT region.

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