From 2019 to 2023, Kuwait's startup landscape experienced fluctuations in activity and investment. After a promising year in 2021 with significant funding raised, subsequent years saw a decline in deals and investment amounts, contrasting with neighboring GCC countries. This article provides an overview of Kuwait's startup ecosystem during this period

Fluctuations in Kuwait's Startup Landscape

Over the years spanning from 2020 to 2023, Kuwait's startup ecosystem has experienced fluctuations in activity and investment. In 2021, the landscape showcased promise with 7 deals amounting to $42 million raised, indicating a burgeoning scene ripe with potential. However, this momentum faltered in the subsequent years, with 2022 witnessing a slight decline to 8 deals and $25 million raised, followed by a notable decrease in 2023 to 4 deals accumulating $12 million. These figures depict a trajectory that diverges from the robust growth observed in neighboring GCC countries during the same period, prompting questions about the factors contributing to Kuwait's lagging position within the regional startup arena.

Top Funding Rounds in Kuwait's Startup Scene

From 2020 to 2023, several Kuwaiti startups secured notable funding rounds, reflecting investor confidence and highlighting the potential of the local entrepreneurial landscape.

Boutiqaat

Transitioning from a cosmetics distributor to the Gulf's largest e-commerce platform, Boutiqaat secured $45 million in January 2018 from Boubyan Petrochemical Company.

The Cofe App

Revolutionizing the online coffee marketplace, the Cofe App raised $28.2 million, positioning itself as a major player in the region. In its Series B round, it secured $15 million led by WAED Ventures.

Ajar

Simplifying property management and rent collection, Ajar closed its Pre-series A round with $7.5 million in investment from SBX Capital, 500 Startups, and Seed Partner.

Most Active Investors in Kuwait's Startup Investment Landscape

During this period, several prominent investors played pivotal roles in Kuwait's startup landscape, contributing capital, expertise, and support to foster growth and innovation in the region. Among these key investors were:

Arzan Venture Capital (Arzan VC)

Established in 2014, Arzan VC is one of the earliest venture capital firms in the region. Focusing on innovative tech teams, it has invested in over 40 startups across 10 countries, including unicorns. With a pan-regional presence, Arzan VC brings extensive investment, technology, and entrepreneurship expertise to the table.

Faith Capital

Founded in 2016, Faith Capital is a Kuwait-based venture capital firm that emphasizes long-term value creation by supporting e-commerce businesses regionally and internationally. Through funding and operational expertise, Faith Capital aims to cultivate growth and sustainability in its portfolio companies.

Kuwait Investment Authority (KIA)

As the Middle East's oldest sovereign wealth fund, KIA manages Kuwait's financial reserves and future generation fund. With a global asset allocation strategy, KIA aims to achieve long-term investment returns to benefit the state of Kuwait.

Al Dhow Capital

Serving as the investment arm of AlSayer Group Holding, Al Dhow Capital focuses on sustainable value creation through selective acquisitions and portfolio strengthening. Its venture capital arm, DC VC Fund, invests in early-stage technology-based startups, leveraging industry experience and analytics for strategic investment decisions.

Savour Ventures

Specializing in agriculture, ag-tech, and food industries, Savour Ventures supports early-stage startups across the food value chain. Through its incubator program and accelerator, Savour Ventures aims to catalyze innovation and excellence in the food sector, with a strong presence in the MENA region.

Notable Exits

Two of Kuwait's notable success stories were Carriage and Talabat, both food delivery startups. Talabat was acquired by Rocket Internet for $170 million in 2015. Subsequently, Rocket Internet sold its food delivery business in the Middle East to Delivery Hero in 2016. Delivery Hero then continued its expansion, acquiring Carriage in 2017 for $100 million, a remarkable feat considering Carriage had been founded just fourteen months earlier with only $1.3 million in external funding. Following a period of independent operation, Carriage was later integrated into Talabat as part of Delivery Hero's consolidation efforts.

A Glimpse Into 2024

Kuwait had a strong start to 2024 with some exciting news. Bookr, a digital platform connecting customers with beauty services, received a bridge round from Plus VC. Meanwhile, social commerce startup Mojo raised a significant seven-figure Seed round led by existing investors Joa Capital and Emkan Capital, along with new backers like Plus VC, Atyab Al Marshoud, Wahed Invest, and other angel investors. As for Baims, they have acquired Orcas, an Edtech based in Egypt.

This overview reflects a dynamic journey for Kuwait's startup ecosystem, marked by ups and downs. Despite fluctuations, startups like Boutiqaat, The Cofe App, and Ajar showcased local potential. Key investors such as Arzan Venture Capital, Faith Capital, and Kuwait Investment Authority continue to contribute to the ecosystem's development.