Startups in Qatar received record-level funding during the initial two quarters of the year.
The first half of 2021 witnessed a significant increase in Venture Capital (VC) activity with total capital being raised to QR31m, which is 182 percent higher than QR11m, as recorded during the second half of 2020, KPMG has said in its recently released second edition of Tech – Startup Investments Round Up. The report tracks quarterly highlights from the Technology and Startup funding space in the Mena region and Turkey.
Interestingly, though startups in Qatar experienced fewer deals (10 deals) during the first half of 2021, compared to the second half of 2020 (14 deals), the size of the deals remains robust, signaling increased investor confidence in Qatari startups. The investors in Qatar chose to back industries such as E-commerce, Delivery services and FinTech, which also saw increased demand during the pandemic and retained the top three spots by number and value of deals. Fascinatingly, the startups from the E-commerce sector secured approximately 60 percent of the total funding raised in Qatar.
Startups in the Middle East, North Africa and Turkey secured funding of more than $1.2bn during the second quarter (Q2) of 2021. The startups in the Delivery Services sector secured the largest funding of 45 percent of the total investments followed by E-commerce (18 percent) and FinTech (17 percent).
Nizar Hneini, Partner and Head – Digital and Innovation at KPMG in Qatar, said: “As the region remains on its path to digitally transform, the startup ecosystem continues to witness a significant growth trajectory on the back of rapid digitalisation and tech adoption. Despite the headwinds caused by the pandemic, Q2 2021 turned out to be a blockbuster quarter for tech startups in the region – marching steadily past a total funding of over $1bn.”
Commenting on Qatar’s entrepreneurial ecosystem, Venkat Krishnaswamy, Partner and Head of Advisory at KPMG in Qatar, said: “Qatar’s strong focus on innovation and entrepreneurship is helping boost its appeal as an attractive destination for business especially for SMEs".
He added: "In recent years, we have seen increased activity in the number of tech startups gaining prominence in the Qatari market. The increased funding along with subsequent deals is an evidence of improved confidence in the tech startup market. Qatar is experiencing a growing number of incubators, accelerators and investment funds as well as entrepreneurship programmes that cater to this thriving community.”
As the region remains on its path to digitally transform, the startup ecosystem continues to witness a significant growth trajectory on the back of rapid digitalisation and tech adoption. Despite the headwinds caused by the pandemic, Q2 2021 turned out to be a blockbuster quarter for tech startups in the region – marching steadily past a total funding of over $1bn.
Qatar’s strong focus on innovation and entrepreneurship is helping boost its appeal as an attractive destination for business especially for SMEs
In recent years, we have seen increased activity in the number of tech startups gaining prominence in the Qatari market. The increased funding along with subsequent deals is an evidence of improved confidence in the tech startup market. Qatar is experiencing a growing number of incubators, accelerators and investment funds as well as entrepreneurship programmes that cater to this thriving community.