MAGNiTT analysed the backgrounds of the founders of MENA’s most successful startups, ranked by total disclosed funding. The top 100 startups together have raised over $1.42 billion in funding, and each startup has raised more than $500,000 individually.
Key takeaways from MAGNiTT’s research include:
1. Team structure
The 100 Startups, including the likes of Careem, Souq and Fetchr, are made up of a total of 189 founders. Research also shows that 40 percent of startups were created by sole founders; up to 79 percent were either sole or two founders which is higher than international comparisons where 69 percent are made up of teams of two or three founders, and in MENA, 12 percent of successful founders are female in comparison to 15 percent in the EU and 17 percent in the US.
2. Experience of founders
Research showed that on average in MENA, founders had nine years worth of experience before starting their companies in comparison to the US unicorns that had six years.
“Entrepreneurship has multiple challenges including growing a business, raising funds and developing a strong team and culture. The data highlights that founders in the region have often come from corporate backgrounds. This indicates that the experience and knowledge provides them with the tools to tackle and overcome such issues,” said Philip Bahoshy, Founder, MAGNiTT.
The research shows that 41 percent of the startup founders graduated from MBAs including Harvard, INSEAD and LBS; 35 percent of founders came from Management Consulting and Banking backgrounds; MENA founders demonstrate a higher technical background with 48 percent graduating with IT or Engineering degrees, and 35 percent of founders previously had startup experiences in the region with Yahoo Maktoob, Dubizzle, Bayt and Zawya alumni making up eight percent of the top 100 MENA startup founders.
Bahoshy added that such individuals are likely to have the cash to bootstrap, experience to deal with the regulatory environment and perseverance to succeed in a nascent ecosystem.
3. Where startups are located
Approximately 68 percent of MENA startup founders originate from the Middle East, despite many having dual citizenship. The data highlights that 38 percent of MENA’s 100 startup founders are from Lebanon and Jordan with only 16 percent of startups headquartered there, and while the UAE hosts 50 percent of MENA’s top funded startups, only one percent of founders are UAE nationals.
“While celebrating the tremendous success of the likes of Souq and Careem, both of whom have founders with a wealth of experience, our research highlights areas that can be developed and fostered through policy changes and investment to further help shape the startup ecosystem across MENA,” said Bahoshy.
By Jessica Combes
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