Unpacking MENA AI Growth in 2025

MENA’s AI startup surge in 2025 looks impressive at first glance—30% growth year-on-year. But dig deeper, and much of that momentum comes from older tech firms rebranding themselves as AI-first. Of the 76 new AI startups launched this year, nearly 60% are rebrands, leaving only 33 genuinely new ventures.

The UAE and Saudi Arabia dominate the landscape, hosting 80% of the region’s AI startups. Yet investors are increasingly skeptical, asking whether AI is core to the product or just a marketing layer. As one VC put it: “Buzzwords don’t raise capital. Defensibility does.” Proprietary data, infrastructure, and AI-native workflows are what separate true builders from opportunistic rebrands.

The next chapter of MENA AI belongs to those who innovate structurally—not just cosmetically.