Village Capital, the largest supporter of impact-driven, seed-stage startups in the world has released a new report The Promise of Impact Investing in the Middle East and North Africa. The report is based on Village Capital’s years of engagement with investors and many of the region’s most dynamic startups that offer investors both impact and returns.
“In MENA, we are seeing some of the toughest challenges worldwide along with some of the most innovative entrepreneurs,” said Alicia Sornson, Manager of Programs & Partnerships in MENA at Village Capital. “We are not working on this alone. In the past few years, we have seen an increase in MENA-based investors supporting impact-focused entrepreneurs. Investors realize that doing good makes sense. But there’s a lot of work still to be done. In this report, we outline what we see as the greatest opportunities for impact in MENA, and which investors are already making big moves in these areas.”
According to the report, the five sectors that present the most exciting opportunities for investment in MENA are:
● Fintech: Alternative Lending - The MENA region has the largest number of unbanked people globally. Some 85 per cent of transactions are still cash based. This has created an opportunity for fintech tools that are being built on top of preexisting payments infrastructure to allow a young and growing population in the region to achieve financial independence and with that their goals. Fintech has dominated the investment scene since 2018, continually being one of the top sectors receiving investment in the region.
● Fintech: Democratizing Tools for Small Business - Integrated B2B and B2C solutions are being developed in the MENA region to facilitate the growth of e-commerce and e-payments and increase operational efficiency. Relevant solutions help facilitate a more efficient and transparent relationship between bank and customer. Fintech tools, that allow small businesses to flourish by making the relationship with banks more efficient and transparent, are seeing increasing demand.
● Education and Job Creation – There is an increase in easy-to-use tools that are streamlining the hiring and training process, by making earning and learning opportunities accessible.
● Green Tech - Tools that improve the resilience of the planet with a focus on sustainable sourcing, sustainable food systems, and regenerative farming practices, are growing in demand.
● Health and Equity - Tools that improve housing security, social wellbeing and mental health, are increasingly important.
The report also highlights some of the most impressive early-stage companies that are helping to transform their industries, such as:
- Kaoun (Tunisia) enables unbanked and underbanked individuals and businesses access to financial services through identification, payment and credit solutions.
- Noon Academy (Saudi Arabia) makes an educational, engaging and affordable social learning platform that allows students to learn from peers, compete with them and initiate live on-demand study groups.
- SunBox (Palestine) provides renewable energy to communities through the sale and installation of batteries, solar panels, and inverters in the Middle East.
- Safe Space (UAE) a provider of virtual workshops on mental wellness topics like work-life balance and mental resilience, done in collaboration with mental healthcare professionals.
- Natrify (Egypt) is a manufacturer focused on providing sustainable solutions through circular environmental technologies with a focus on the packaging industry, including shopping bags.