Egypt’s Micro, Small, and Medium Enterprise Development Agency (MSMEDA) has announced a $7.5 million investment across three regional venture capital funds, reinforcing its commitment to fostering entrepreneurship and supporting startups in the country. The funding underscores the Egyptian government’s strategic efforts to create a vibrant startup ecosystem and align with the broader goals of Vision 2030 for economic diversification and innovation.
MSMEDA’s recent $2 million investment in the P1 Ventures Fund aims to provide financial backing to promising startups across various sectors. The fund’s focus extends beyond Egypt, targeting startups with the potential to compete in African markets. Basil Rahmi, CEO of MSMEDA, highlighted the importance of leveraging Africa’s promising opportunities to benefit Egypt’s youth, stating that such initiatives enhance both market competitiveness and regional integration.
Approximately one month prior, MSMEDA committed $3 million to the Foundation Ventures Fund. This investment is designed to stimulate innovation, improve the competitiveness of Egyptian startups, and bolster the national economy. The fund operates as part of MSMEDA’s larger investment program, launched in collaboration with the World Bank. The program’s primary objective is to support entrepreneurship and create jobs, marking it as the first “Fund of Funds” (FoF) initiative in Egypt. By financing local, regional, and international venture capital funds, this initiative enables early-stage Egyptian startups to thrive in a diverse and competitive ecosystem.
In November 2024, MSMEDA signed documents for a $2.5 million contribution to the Capital Ventures Development Fund 2 (Tanmia Capital Ventures 2). This move aligns with the agency’s strategy to attract foreign capital and provide diverse financing solutions for Egyptian startups. The initiative also aims to facilitate economic growth and diversification in line with Egypt’s Vision 2030.
The latest funding contributions are part of Egypt’s broader “Fund of Funds” initiative, which has ambitious plans to secure up to $1 billion in funding. This initiative aims to catalyze Egypt’s venture capital ecosystem by attracting international investment. In 2022, the program’s pilot phase successfully deployed $50 million, funded by the World Bank, across approximately 15 venture capital funds. These funds received between 10% and 20% of their capital from MSMEDA.
Amr Al-Abd, Advisor to the Prime Minister for Entrepreneurship, noted that the program’s expansion is designed to enhance Egypt’s startup ecosystem and extend its influence into African and Arab markets. “The Fund of Funds is the main driver of this strategy,” he stated in an interview with Al Sharq Bloomberg Channel.
The Fund of Funds model offers diversification and risk mitigation by investing in multiple venture capital funds rather than directly in startups. In Egypt, this approach has already delivered tangible results. Notably, Endure Capital, backed by the program, successfully closed its $50 million Africa-focused fund in 2022. Founded by Tarek Fahim, Endure Capital has invested in leading startups such as Careem, MaxAB, and Breadfast.
Hani Emad, head of MSMEDA’s Central Sector for Venture Capital Investments, emphasized the transformative role of the initiative. “Our focus is to empower small projects operating in Egypt and enable their expansion into regional markets,” he stated. The program’s diverse portfolio, spanning sectors from logistics to fintech, highlights its ambition to drive innovation and entrepreneurship.
With Egypt’s demographic advantage and rising startup activity, the country’s authorities aim to position venture capital as a cornerstone of economic diversification. The Fund of Funds initiative is poised to address Egypt’s venture capital gap while attracting international investors. Additionally, the country’s strategic location as a gateway to African and Middle Eastern markets offers compelling incentives for global participation.