File photo used for representation only.
The venture capital (VC) ecosystem in Qatar has demonstrated resilience despite the challenging situation created by the COVID-19 outbreak as startups in Qatar have raised QR22m in 2020, more than the QR21m deployed in 2019, according to ‘Qatar Venture Investment Report 2020’. Qatari startups continued on the positive trajectory established last year as they raised 41 percent more capital in the first half of 2021 than in full-year 2020.
Accelerators drove investment rounds in Qatar last year, contrary to the regional trend.
“In Qatar’s venture investment ecosystem, accelerated programs were responsible for 33 percent of all transactions. This defied the trend noted in MENA where COVID-19 forced a slowdown of accelerator programs, with accelerated deals dropping by nine percentage points year-on-year in 2020,” noted the ‘Qatar Venture Investment Report 2020’ released by Qatar Development Bank (QDB) in cooperation with research platform MAGNiTT.
In terms of Qatar’s top startup industries by funding, Food and Beverage (F&B) and e-commerce collectively accounted for 53 percent of all VC funding in the ecosystem. The number of startups to raise funding from the Home Services sector went from one in 2019 to three in 2020.
As the VC ecosystem demonstrated resilience against the pandemic, the number of registered deals rose by two to finish 2020 at 24.
With reduced concentration of capital in larger deals, funding into early stage startups surged, noted the report. All transactions in 2020 were in favor of early stage startups. Share of the largest five deals in total venture investment dropped from 78 percent in 2019 to 63 percent in 2020, leaving other deals with access to more funding.
The need for digitalisation in 2020 made a positive impact on the e-commerce and Home Services sectors, said the report.
The year 2020 saw the Qatari VC ecosystem record a rare exit. Real estate venture Qproperties was acquired by Kenyan tech firm Tevalu in 2020. Across the Middle East and North Africa, 17 exits were recorded in the year.
