Egypt is advancing plans to secure up to $1 billion in funding for a national “Fund of Funds” program, a strategic effort designed to catalyze the country’s venture capital (VC) ecosystem. Amr Al-Abd, Advisor to the Prime Minister for Entrepreneurship, disclosed that negotiations are underway with international partners to raise between $500 million and $1 billion for the program.
The announcement follows the initial success of a $50 million investment channeled into the Fund of Funds in 2022, which was financed by the World Bank. This initial tranche was deployed through the Micro, Small, and Medium Enterprise Development Agency (MSMEDA) and invested in around 15 venture capital funds, contributing between 10% and 20% of each fund’s capital.
According to Al-Abd, the program’s expansion aims to reinforce Egypt’s growing startup ecosystem while extending its reach to emerging African and Arab markets. “The Fund of Funds is the main driver of this strategy,” he said in an interview with Al Sharq Bloomberg Channel.
A fund of funds operates by investing in multiple underlying investment funds rather than directly in startups, offering diversification and risk mitigation for its investors. In Egypt ’s case, the ‘Fund of Funds’ program seeks to build local capacity in venture capital by supporting both existing and new fund managers, thereby expanding financing options for startups across sectors.
Hani Emad, head of the Central Sector for Venture Capital Investments at MSMEDA, highlighted the transformative role of the Fund of Funds in integrating venture capital into the agency’s financing strategy. “Our focus is to empower small projects operating in Egypt and enable their expansion into regional markets,” Emad noted in previous remarks.
The fund has already backed prominent venture capital firms such as Endure Capital, which in 2022 closed its $50 million Africa-focused fund. Founded by Tarek Fahim, Endure Capital has been a key player in the startup ecosystem, with investments in companies like Careem, MaxAB, and Breadfast.
The $50 million pilot phase demonstrated the Fund of Funds’ potential as a mechanism to attract international capital and support high-growth startups. Its portfolio spans various sectors, from logistics and e-commerce to fintech, reflecting the broad ambitions of Egypt’s entrepreneurial community.
With plans to scale the program significantly, Egyptian authorities hope to tap into the country’s demographic advantage and rising startup activity. The latest funding push, if realized, could provide a much-needed boost to local venture capital, which remains relatively underdeveloped compared to regional peers.
The Fund of Funds initiative also aligns with broader regional trends, where governments increasingly look to venture capital as a tool for economic diversification and innovation. Egypt’s strategic location and its role as a gateway to African and Middle Eastern markets provide additional incentives for international investors to participate in the program.