Egypt continues to see increasing VC investment, hit USD 2.6 billion in 2021

According to startup platform Magnitt, 2021 saw investments of USD 2.6 billion across the MENA region, and Egypt was recorded as one of the most active markets in North Africa.

Egypt’s VC environment

Magnitt’s report stated that the Egyptian VC environment has accounted for 15 percent of transactions and 11 percent of the deployed capital in the MENA region. Fintech deals account for 17 percent of deals last year and seven Egyptian startups announced exits, the highest number in a year ever recorded.

UAE-based Global Ventures – which has invested in Egyptian start-ups such as food delivery app elmenus, B2B platform Cartona and electronic payment provider paymob – will manage a dedicated FinTech fund in Egypt that will launch next week, said Basil Moftah, general partner of Global Ventures.

“Great opportunity”

“Egypt’s a place to double-down on. There’s a lot of great opportunity,” Mr Moftah said. “There’s just so much happening in the FinTech space that we believe having a dedicated vehicle for that is a great opportunity for investors, but also to help Egypt make progress on the financial inclusion side of sustainability.The reality is that Egypt is not digitised. That’s what we think these FinTechs are solving for and that’s why we think they’ll grab a lot of market share.”

The emergence of fintech

Rafeh Saleh, founding partner at Cubit Ventures, an early stage venture fund backing tech start-ups in Egypt, said, “We’re lucky. We have the best of both worlds – being a Middle Eastern country and an African country.”

Ahmed El Alfi, chairman and co-founder of Sawari Ventures, an investment firm that have invested in Elves, KEngine and Swvl, closed a $69m fund to invest in Egyptian start-ups last year. El Alfi said that the company planned to look for “deeper tech companies to start coming out of the region, rather than just copy-paste”. He went on to say that the emergence of Fintech in Egypt has allowed his fund to focus on the sector, rather than looking at the wider startup ecosystem, “We’re paying for the future,” Mr El Alfi said. “VC investors are looking at what can go right and how far can you go, and that’s really what you value,” he said.