Unicorn pathways: How the UAE shapes Mena's billion-dollar corridor

For years, the idea of building billion-dollar startups in the Middle East and North Africa seemed remote. Today it is a reality. The region has produced eight unicorns between 2020 and the first half of 2025, and more are expected in the years ahead. Their rise reflects more than valuation. It marks the maturing of a venture ecosystem, the arrival of sophisticated investors, and governments determined to diversify economies beyond oil.

The UAE sits at the centre of this story. It was in Dubai that Dubizzle and Kitopi first proved regional startups could attract international capital and scale. Abu Dhabi has since emerged as one of the fastest growing startup ecosystems worldwide. Yet the unicorn story no longer belongs solely to the Emirates. Saudi Arabia has become the anchor for late-stage funding, Egypt has shown that demand-heavy markets can break through despite turbulence, and together with the UAE they now define the billion-dollar corridor of Mena.

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A Five-year Arc of Growth

MAGNiTT’s report Beyond the Billion: The Evolution of Mena’s Unicorn Landscape (2020–H1 2025) shows eight companies crossing the billion-dollar mark: Dubizzle Group, Kitopi, Foodics, Vezeeta, Halan, Tabby, Tamara and Ninja.

The first breakthroughs came in 2020 and 2021 when Dubizzle and Kitopi scaled out of the UAE. In 2022, Foodics in Saudi Arabia and Vezeeta in Egypt confirmed unicorn creation was now regional. The high point came in 2023 with Tabby, Tamara and Halan. The following year was quiet as global liquidity tightened, before momentum returned in early 2025 with Ninja in Saudi Arabia.

This rhythm highlights the influence of capital cycles. Periods of liquidity enabled clusters of unicorns while slowdowns produced pauses. The consistent thread has been local capital depth, particularly in Saudi Arabia and the UAE, which determined whether unicorns could emerge.

From Launchpad to Growth Engine

Geography tells the story of shifting balance. The UAE dominated early with Dubai’s venture hubs and Abu Dhabi’s sovereign capital. Since 2022, Saudi Arabia has become the primary growth engine, producing four unicorns and cementing its role as late-stage anchor. Egypt added two, Vezeeta and Halan, proving that consumer-driven scale can deliver even amid headwinds.

As Farah El Nahlawi of MAGNiTT explains, “Between 2020 and H1 2025, MENA’s unicorns tell a powerful story of how the region is scaling. Far from isolated wins, they highlight a clear playbook: solve inefficiencies, anchor in local capital depth, and pair regional conviction with global validation.”

The Funding Climate

Fresh data underscores why the next unicorns are likely. In the first half of 2025, startups raised more than $2.1 billion, a 134% increase year on year and already above 2024’s total. The UAE accounted for $1 billion, rebounding from $438 million in the previous half-year. That placed the Emirates ahead of ecosystems such as Japan and Sweden.

Late-stage deals dominated, taking about $817 million, while seed-stage funding shrank to just $32.7 million. Early-stage deals reached $167 million, modestly up from 2024 but still subdued. Investors are concentrating capital on scale-ups rather than spreading bets thinly. Enterprise applications, fintech and retail led the UAE’s deal activity. Vista Global’s $600 million raise and Tabby’s $160 million Series E exemplified the trend. Dubai accounted for more than 90% of UAE deal flow. While these rounds did not mint new unicorns in first half of 2025, they reinforced the Emirates’ role as a scale-up hub and signaled strong investor confidence.

The Unicorn Playbook

MAGNiTT distills the unicorn journey into three lessons. Every unicorn had a strong local anchor investor who provided continuity through multiple rounds. They focused on sectors with clear inefficiencies: fragmented payments, food delivery, healthcare access or property marketplaces. Finally, they paired local conviction capital with one or two international validators who offered credibility at the right moment.

Tabby and Tamara demonstrate the formula. Both localised buy-now-pay-later models to suit regional needs. They relied on persistent local backers like STV and Mubadala while adding global investors such as Arbor Ventures to secure validation.

Silvina Moschini, Chief Executive of Unicoin and Unicorn Hunters, says the UAE remains well-positioned. “The Gulf states like the UAE offer conducive regulatory environments and a strong venture capital pool that is unparalleled in the region. Add to that the tremendous talent pool the UAE has built in recent decades, and you have an ecosystem primed for unicorn growth,” she notes. Amar Rizvi, Chief Strategy Officer at iMile, stresses opportunities and risks. “Technology-driven industries such as fintech, logistics, mobility and e-commerce are likely to dominate. Clean and sustainable technology startups are also gaining traction. But challenges include regulation, access to funding, talent acquisition and market saturation,” he told BTR.

Philip Bahoshy, Chief Executive of MAGNiTT, calls 2023 an adjustment year. “Funding contracted and investor numbers fell, but signs of adaptation emerged. Early-stage diversification and exit activity suggest a recalibration towards a soft landing.”

He adds that international startups relocating to the UAE and VCs establishing in ADGM and DIFC will intensify competition and raise capital deployment.

Why the UAE Still Matters

Saudi Arabia may now dominate late-stage growth, but the UAE remains indispensable. It provides the early launchpad that proves models can scale, the regulatory clarity that builds investor trust, and the cosmopolitan workforce that powers expansion.

Abu Dhabi is among the fastest growing ecosystems globally, with a 134% rise in ecosystem value. Dubai continues to dominate deal activity, ensuring the UAE retains its role as proving ground for companies aiming at billion-dollar valuations

The unicorn pathway in Mena will continue to run through the UAE, Saudi Arabia and Egypt. Founders must design for this corridor from day one, secure a local anchor investor, and target sectors with structural inefficiencies. They must also earn the trust of conviction investors capable of writing repeat cheques and be ready for scrutiny from international funds now based in the UAE.

For investors, the message is straightforward. The Gulf is no longer experimenting with unicorns. It is institutionalising their creation. Local capital provides depth, international validation offers credibility, and governments supply regulatory clarity and infrastructure. The result is a repeatable model that can deliver billion-dollar outcomes at scale.

A Regional Playbook Emerges

The emergence of eight unicorns between 2020 and the first half of 2025 shows that Mena can produce companies of global stature. The UAE may not create unicorns every year, but its role as launchpad and showcase is essential. Saudi Arabia contributes capital depth, Egypt adds consumer scale, and the UAE ties it together with governance and investor access.

As Moschini observes, unicorns are naturally drawn to markets that offer opportunity and talent. The UAE remains one of those markets. For investors seeking the next billion-dollar stories, the answer lies in this corridor. It is not about replicating Silicon Valley. It is about building on the foundations of Dubai, Abu Dhabi, Riyadh and Cairo, and shaping a distinctly regional playbook that is only just beginning.

Sana Eqbal

Staff Writer

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sana@khaleejtimes.com

Sana Eqbal is a journalist with over 10 years of experience and a media strategist specialising in corporate communications, public relations, digital media, and content management.