Start-ups across the Middle East and North Africa (MENA) raked in a total of $882 million in investments during the first half of the year.

The total funding was down by around 46% from the $1.6 billion raised in the same period in 2023, a report from Wamda and Digital Digest said. However, if the debt financing secured last year will not be considered, the decline this year would only be around 12%.

“The uncertainty that has prevailed due to the war in Gaza and the potential military escalation in the region, has cast its shadow on the start-up ecosystem, prompting regional and international venture capital firms (VCs) to adopt a ‘wait-and-see’ stance,” the report said.

The month of June saw young businesses raise $116 million, up by 182% from the same period last year, but down by 59% from May.

Last month’s fundraising activity was led by start-ups based in the UAE, with funds totalling $82.5 million spread across 15 transactions.

Despite the year-on-year growth in funding, last month’s fundraisings saw the absence of mega deals, according to the report. The biggest amount raised was logged by Tendered, raising $30 million.

Fintech, however, emerged as the winner during the month, as the sector raised the most funds reaching $38 million across 10 deals.

(Writing by Cleofe Maceda; editing by Seban Scaria)