Investing in women is no longer just a social cause, it’s an economic necessity. For decades, the narrative around economic growth in the Middle East and North Africa (MENA) has been dominated by discussions of oil, infrastructure, and foreign investments. But there’s another powerhouse waiting to be fully tapped: women entrepreneurs. Across the region, women are starting businesses at record rates, breaking barriers in tech, finance, and innovation. Yet, when it comes to securing funding, the door remains frustratingly closed. Despite their resilience, skill, and impressive business success rates, women-led startups continue to receive only a fraction of the investment capital that male-led businesses do.
This isn’t just an equity issue, it’s an economic problem. Studies consistently show that companies founded or co-founded by women deliver higher revenue returns per dollar invested. Yet, female entrepreneurs in MENA face systemic biases, funding gaps, and social barriers that limit their access to the capital they need to scale. If the region is serious about diversifying its economy, accelerating innovation, and increasing global competitiveness, then investing in women is not an option, it’s a necessity.
The Current Landscape
Women in MENA have the lowest rates of Total Entrepreneurial Activity (TEA), with merely 4% of the population engaged in entrepreneurial endeavors, compared to 27% in sub-Saharan Africa and 15% in Latin America and the Caribbean. This disparity is further highlighted by the fact that less than 5% of businesses in MENA are women-led, whereas the global average stands at 26%.
MENA is home to some of the most ambitious, educated, and business-savvy women, yet the system is failing them. The region produces more female STEM graduates than the U.S. or Europe, yet these women struggle to find funding or leadership roles in their respective industries. Without the right financial backing, many brilliant, game-changing ideas never get off the ground, a loss not just for these entrepreneurs but for the entire regional economy.
Funding Disparities
The venture capital landscape in MENA tells a frustrating story. Female-led startups receive less than 2% of total regional investments, despite data proving they often outperform male-led startups in return on investment. The capital simply isn’t flowing where it should, and the numbers speak for themselves.
For instance, in 2023, out of 583 startups that secured funding in MENA, only 52 were founded by women, collectively raising just $19 million. This marks a staggering 63% drop from the $52 million raised in 2022.
The Bias Factor: Perception vs. Reality
The struggle isn’t just about numbers, it’s about perception. A survey of 125 female founders in the region revealed that 58% believe MENA investors are less likely to invest in women-led startups compared to global investors. This isn’t paranoia, it’s backed by research showing that 66% of women founders feel investors exhibit less interest in funding startups led by women.
Many women report being grilled more intensely about their financials and risk management than their male counterparts, often facing skepticism about their ability to scale and sustain a business. Investors, often unconsciously, continue to associate business leadership with men, reinforcing outdated gender stereotypes.
The Economic Imperative: Why Investing in Women is Good Business
Underrepresentation in entrepreneurship has massive economic consequences. The MENA region loses approximately $575 billion annually due to the lack of female economic participation.
More importantly, studies indicate that gender-diverse businesses are more profitable and sustainable. In fact:
- Companies with at least one female founder perform 63% better than all-male teams.
- Women reinvest up to 90% of their income back into their communities and families, compared to 30-40% for men.
- If gender parity in entrepreneurship were achieved, the global economy could see an additional $5-6 trillion in net value.
It’s simple: When women succeed, economies grow. Investing in women is not just the right thing to do, it’s the smartest economic strategy available.
Catalysts for Change: What Needs to Happen Now?
Some initiatives are already working to change the landscape. The International Finance Corporation (IFC) launched “She Wins Arabia”, an initiative aimed at increasing visibility for female entrepreneurs and providing resources for venture capital funds and accelerators to invest in them.
Governments and private sector players must now take bigger, bolder actions:
More women-focused venture funds: MENA needs funds dedicated specifically to female-led businesses.
Investor education & bias training: Shifting investor mindsets is crucial to changing funding patterns.
Stronger mentorship networks: Female founders need more access to mentors, networks, and leadership opportunities.
Policy reforms: Governments must introduce policies that incentivize investing in women and remove bureaucratic barriers for female entrepreneurs.
The Call to Action: This Shift Can’t Wait
It’s time to stop seeing investing in women as corporate social responsibility and start treating it as what it truly is, one of the smartest business decisions investors and policymakers can make.
Women in MENA are ready, capable, and eager to lead, they just need the capital shift to match their ambition. The money is there. The talent is undeniable. The only thing missing? The will to change.
The future of MENA’s economy isn’t just oil and tech hubs, it’s in the hands of the women who are ready
