Venture capital impact investment in Saudi Arabia reached a new high in 2021 in both total numbers of transactions and capital deployed, according to a report produced by MAGNiTT and sponsored by Wa’ed, Saudi Aramco’s entrepreneurship arm.
Impact investments aim to generate a measurable social and environmental benefit alongside a financial return, Arab News reports.
Impact funding in the Kingdom up to the third quarter of 2021 was 130% higher than in 2020 in terms of funding and 21% higher in transactions.
According to the report, some $444 million were invested through 403 deals with impact-driven startups across the Middle East and North Africa between 2016 and the third quarter of 2021.
Of those deals, 20% involved Saudi-based firms.
Flat6Labs was the leading impact investor in startups based in the MENA region, with 45 transactions between 2016 and the third quarter of this year to date.
The Saudi Aramco Entrepreneurship Center, 500 Startups, the King Abdullah University of Science and Technology Innovation Fund, Oasis 500, and Falak Startups invested in 12 or more funding rounds raised by impact-driven startups in MENA.
The education and healthcare technology sectors accounted for the highest share in total impact VC deals, collectively registering 40% of all transactions in MENA from 2016 to the third quarter of this year to date.
The energy sector played a crucial role in impact investments across MENA, with 95% of all funding going to startups within the impact ecosystem.
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