EGYPT – Sawari Ventures, the Cairo-based investment management firm, has announced the close of its Egyptian fund with new commitments of US$28 million (EGP440 million) to invest in Egyptian startups both seed-stage and growth-stage.
The investments in seed-stage companies will be made through Flat6Labs in Egypt and Tunisia, Hany Al-Sonbaty, the co-founder and Managing Partner of Sawari Ventures said.
“Ten percent of the fund is earmarked for seed-stage companies through investment in Flat6labs vehicles. Flat6Labs Cairo will seed 80-100 companies and offer follow-on investments to 30-40. Flat6Labs Tunisia will seed 60-70 companies and offer follow-on investments to 30-40,” Hany added.
Hany Al-Sonbaty – Co-founder and Managing Partner, Sawari Ventures
The rest of the fund (90 percent) is earmarked for growth-stage companies with a media investment range of US$2 to 3 million.
Speaking about the kind of companies the Egyptian fund will invest in, Hany said, “We try to cast a wide net given that in essence, this is a transformative moment in emerging markets tech with the rapid digitization of the underlying economy.
“So as expected, we’re seeing a great deal flow in the digitization of financial services, health care and education technologies. Also, given the engineering talent, there are unique opportunities in SaaS products, semiconductors and IoT.”
The fund had previously closed US$41 million (EGP 650 million) from European Investment Bank and different development finance institutions including United Kingdom’s CDC, France’s Proparco, and Dutch Good Growth Fund. It takes the total size of the fund to US$69 million (EGP 1.09 billion). This fund will only.
Sawari also has a US$70 million North Africa-focused fund that invests in Egyptian, Moroccan, and Tunisian startups. It had raised $35 million in its first close in December 2018.
“The Egypt based fund is a privately-held fund regulated by the Financial Regulatory Authority of Egypt (FRA), which allowed us to attract capital from top tier local financial institutions to co-invest with foreign capital from international development financial institutions, doubling our allocation to invest in Egyptian high growth companies to sixty-eight million U.S. Dollars,” Ahmed El Alfi, the founder and Chairman of Sawari Ventures, in a statement, said.
“Our aim is to create exceptional returns through investing in knowledge-driven companies, which have the potential of bringing transformational changes to the Egyptian economy. The fund will support local companies with dedicated capital, in addition to quality expertise from our seasoned and specialized team, and the value add of our investors,” he added.
Started in 2010 and led by Ahmed Al-Alfi, Hany Al-Sonbay and Wael Amin, Sawari Ventures is one of the leading VCs in Egypt and has over 30 companies its portfolio including Swvl, MoneyFellows, Instabug, Si-Ware, and Elves, in its portfolio.