Agtech in spotlight as Mena startup funding recovers

Wam

• October funding surges
• $90m raised in UAE
• Agtech lifting sector

Startup funding in the Mena region in October remained subdued on a year-on-year basis, but agtech is one of the areas set to shine.

Mena startups raised $156 million in October, compared to $646 million raised in October 2022, but vastly up on the $36 million raised in September, according to data from Wamda, a regional early-stage investment fund.

The deal count saw a surge from 36 in September to 51 in October, with the UAE dominating at $90 million raised across 24 deals. 

• Dubai SMEs turn to banks as VC funding declines
• Abu Dhabi backs women-led food security startups in Mena
• Vertical saffron farm spices up UAE’s agtech sector

Saudi Arabia-based startups raised the second-largest share of deal value in October, at $51 million, while Egyptian startups raised $13 million putting them in third place.

Both countries attracted nine deals each.

“There is significant dry powder in the market and we are now seeing increased activity across venture capital more generally,” Simon Sharp, partner in the Dubai office of Global Ventures, told AGBI. 

“Valuations are correcting and founders have adapted their approaches,” he said. Sharp said that in March his company was seeing 300 to 400 opportunities every month, but this has now increased.

Since 2020, Global Ventures has been involved in more than $1 billion of transactions.

In March this year it launched a new fund, the Global Ventures Fund III, which focuses on agtech and supply chain technologies. 

“We look to invest across the agtech value chain, from smart farms and precision agriculture to financing and vertical supply chain solutions for farmers,” Sharp said.

Tech innovations such as growing salt-tolerant crops using saltwater and sunlight, and AI-powered credit and finance offerings for farmers, are establishing new benchmarks in the sector, he said.

Mariam Almheiri, the UAE minister of climate change and environment, speaking at the Sharjah International Book Fair on Sunday this week,said that the UAE had placed the global transformation to sustainable agricultural and food systems at the top of its agenda during the Cop28 summit being held in Dubai later this month. 

“Technology can help us track water usage, energy surges, and supply and demand of food,” Almheiri, said, with traditional food systems causing a third of total global greenhouse gas emissions.

“The integration of digital technologies, such as blockchain, IoT [Internet of Things], and AI can improve supply chain transparency, traceability and efficiency. This can reduce food waste, improve food safety and ensure fair and equitable distribution of resources,” she said.

The UAE earlier this year launched the National Food Security Strategy 2051, an ambitious vision to transform the country into a leader in the field of innovation-based food security.

According to Sharp, a number of Global Ventures’ portfolio companies will be participating at Cop28. This includes RedSea, a sustainable agtech company whose technology aids commercial farming in hot climates and which is now operating in 10 different markets.

“I have no doubt that for many scalable businesses, Cop28 presents an excellent opportunity to showcase the advances agtech can deliver in food production,” Sharp said. 

“Improved technological innovations and combining various technologies to work together, some managed via apps on smartphones and smart watches, will no doubt catch the eye.”