Middle East Startup Funding Hits $2.07B in Q1 2026: UAE & Saudi Dominate

Middle East startup funding reached US$2.07 billion across 117 deals in Q1 2026, up 15% year-on-year in capital raised — even as deal volume fell 45%, from 211 to 117 transactions. The average deal size nearly doubled, from US$8.5M in Q1 2025 to US$17.7M, with investors writing fewer but bigger cheques across the region.

Saudi Arabia accounted for 64.8% of total Q1 2026 funding, raising US$1.34 billion across 34 deals — 27% more than the US$1.05 billion recorded in Q1 2025. A US$1.2 billion transaction in January anchored the headline figure, but the Kingdom's deal count held up well, consistent with continued momentum behind its Vision 2030 economic diversification agenda. The UAE came in second at US$651M across 42 deals, a marginal 2% funding increase from Q1 2025, though deal volume dropped sharply from 79. Together, the two markets continue to dominate, capturing 96% of all capital deployed across the region in the quarter.

Elsewhere, Bahrain's numbers jumped from US$1.6M to US$22M on just two deals — a 1,275% increase, though the small base means any sizable transaction moves the dial significantly. Qatar also recorded its busiest quarter, with five deals totalling US$15M, up from a single undisclosed round in Q1 2025.

Turkey moved in the opposite direction. Funding fell from US$95.5M to US$31.3M and deal volume dropped from 67 to 27 — continuing a slide from its Q1 2024 high of US$101.7M across 148 deals. The three-year trajectory points to a sustained recalibration in the Turkish market, with macro pressures weighing on both deal flow and ticket sizes.

Zooming out, regional funding has more than doubled since Q1 2024 (US$891M), with Saudi Arabia's rise accounting for most of that growth: from US$226M in Q1 2024 to US$1.34B in Q1 2026, a near six-fold increase in two years. January 2026 alone saw US$1.6B close — more than the entire region raised across the full quarter a year prior. Deal stage data shows seed rounds still dominate by volume (the large majority of transactions), even as megadeals drive the headline numbers, pointing to an ecosystem where early-stage activity remains active but late-stage capital is consolidating fast.