Cairo-based quick-commerce platform Breadfast has defended its latest funding round after online criticism emerged over one of its participating investors, highlighting the growing intersection between geopolitics and startup capital in the Middle East.
Last month, Breadfast announced it had raised $50m in a pre-Series C round led by Novastar Ventures through its People and Planet Fund III (NVIII). Other backers included Mubadala, The Olayan Group, SBI Investment, Asia Africa Investment & Consulting, Y Combinator, IFC, EBRD and 4DX Ventures, as well as a Saudi family office.
The controversy centres on SBI Investment, part of Japan’s SBI Group, which has investment exposure across multiple markets, including Israel. Critics on social media have pointed to SBI’s links with Vertex Israel, a Tel Aviv-based venture firm investing in Israeli technology companies, arguing that companies operating in Arab markets should avoid indirect financial ties to Israel amid the ongoing war in Gaza.
In a public statement, Breadfast cofounder and COO Muhammad S. Habib said the company has previously declined capital from investors directly connected to the Israeli state and applies internal ethical standards when assessing funding.
“We have refused money more than once when it conflicted with our moral boundaries,” Habib said, adding that decisions around investors are taken unanimously by the founders.
He argued that criticism of the latest round reflects a misunderstanding of how international investment funds operate. “Global funds manage diversified portfolios across hundreds of countries and sectors,” he said. “When they invest in Egypt, that represents confidence in the Egyptian market, not endorsement of a political position.”
Breadfast said its investors hold minority stakes and that the company remains founder-led and Egyptian-controlled.
The dispute comes at a sensitive time for Egypt’s startup ecosystem. Over the past two years, currency devaluations, inflation and reduced global venture appetite have led to funding slowdowns and valuation pressure across North Africa.
Against that backdrop, Breadfast’s $50m raise — and reported valuation growth — stands out. According to portfolio disclosures from Swedish investment firm VNV Global, which holds a 7.5% stake in the company, Breadfast’s valuation has risen to approximately $403m.
Founded in 2017 by Mostafa Amin, Muhammad Habib and Abdallah Nofal, Breadfast began as a subscription bread delivery service before expanding into groceries, private-label products and fintech. Unlike many asset-light marketplaces that dominated the 2020–2021 funding cycle, Breadfast built a vertically integrated supply chain, including fulfilment centres, production facilities and branded retail outlets.
The company says private-label goods account for around 40% of grocery sales, a strategy it argues has improved margins in Egypt’s high-inflation environment.
Development finance institutions have also backed the company. In 2025, Breadfast secured $10m from the European Bank for Reconstruction and Development (EBRD), and a further $13m investment from the International Finance Corporation (IFC) is planned.
The latest round is intended to bridge the company to a larger Series C in 2026, ahead of a potential IPO.
Breadfast is not the only company in the region to face scrutiny over investor exposure as public sentiment shifts in response to the Gaza conflict. Calls for consumer boycotts have targeted multinational brands and, increasingly, regional companies perceived to have financial or operational ties to Israel.
For growth-stage startups in emerging markets, however, investor bases are often global and diversified, making it difficult to isolate capital from broader international financial networks.
Breadfast has not indicated that the criticism has affected operations or funding plans. But the episode underscores how, in an interconnected capital environment, startup fundraising decisions can quickly become political flashpoints.