Morocco’s decade-long experiment in public startup financing has entered a new phase, as the country shifts from direct grants and loans toward a leveraged fund-of-funds model designed to attract private venture capital at scale.
The transition comes as the World Bank awarded its highest evaluation rating to the first-stage programme, even as independent data point to a persistent weakness in the ecosystem: a shortage of exits.
A first phase deemed “Highly Satisfactory”
The Fonds Innov Invest (FII), launched in 2017 and implemented by the public financing institution TAMWILCOM on behalf of the Ministry of Economy and Finance, received a “Highly Satisfactory” rating in the World Bank’s final evaluation, the highest score in the bank’s assessment system. The programme operated with World Bank financial and technical support.
According to figures released by TAMWILCOM, FII supported approximately 1,000 entrepreneurs and financed more than 500 startups, mobilising over 590mn dirhams ($59mn) in grants, loans and investments since its inception. It also contributed to structuring four seed and venture capital funds, which invested more than 500mn dirhams in around 40 startups. More than 40 patents were filed under the programme, according to the same source.
The World Bank rating was announced at a ceremony in Rabat on 17 September 2026, attended by Mohammed Tarik Bchir, Director of the Treasury and External Finances, and Ahmadou Moustapha Ndiaye, World Bank Country Director for the Maghreb and Malta.
Said Jabrani, Director General of TAMWILCOM, said the rating “constitutes strong recognition of the work accomplished collectively” under FII and “confirms the relevance of a model that brought financing closer to the specific needs of startups”.
Phase two: a catalytic fund-of-funds
The second phase is anchored in the Fonds Catalytique Startups, a new instrument carried by the Ministry of Digital Transition and Administration Reform and managed by TAMWILCOM. Its legal foundation is Decree №2.26.576 of 3 August 2026.
Under the decree, up to 347mn dirhams ($36.4m) of public money can be invested over three years into venture capital funds that back digital startups. Nine management companies have been pre-selected, including 500 Startups Management Company, Emerging Tech Ventures, Kalys Ventures Partners, Middle East Venture Partners, Outlierz Africa, Plug and Play Investment Group, RING, Sawari Ventures, and a partnership between Sienna Venture Capital and AlphaVest Capital.
The funds are expected to mobilise nearly 2.5bn dirhams ($262.75 million USD) for Moroccan startups, according to the ministry. The public contribution is designed as a first-loss guarantee or investment to reduce risk for private investors and attract third-party capital.
The instrument stems from a convention signed in Rabat on 21 November 2025 between the Ministry of Digital Transition, the Ministry of Economy and Finance, the Fonds Mohammed VI pour l’Investissement (FM6I), the Caisse de Dépôt et de Gestion (CDG) and TAMWILCOM. It is part of the Digital Morocco 2030 strategy.
Amal El Fallah Seghrouchni, Minister of Digital Transition and Administration Reform, said the mechanism would allow investors “to take measured risks and startups to cross key growth stages”. Nezha Hayat, Director General of FM6I, described it as “an act of structuring” that would encourage national and international funds to “enter earlier, stronger and more often” into Moroccan startups.
The missing piece: exits
The shift toward a fund-of-funds model addresses a recognised gap in early-stage financing. But independent industry data highlight a separate constraint: the difficulty of exiting investments.
The Moroccan Association of Capital Investors (AMIC), in its 2025 report produced with Grant Thornton, recorded record fundraising of 6.6bn dirhams ($693.66 million USD) and record divestments of 4.2bn dirhams (441.42 million USD). Cumulative exits reached 14.3bn dirhams across nearly 200 divestment transactions, with IPOs accounting for 33 per cent of exit value. Gross IRR improved to 14 per cent from 12 per cent a year earlier.
Those headline numbers, however, mask a structural issue at the startup level. A separate report by UM6P — University Mohammed VI Polytechnic found that Morocco logged “only four meaningful exits in three years, limiting capital recycling”. The report warned that concentrated early-stage funding risks creating an “early-stage trap,” in which promising startups stall due to a lack of follow-on capital while a thin exit pipeline discourages new investors.
The AMIC data largely reflect later-stage private equity activity in established sectors, not venture-backed technology startups. The exits that do occur are concentrated in a small number of companies and are often partial rather than full liquidity events. For venture capital funds to recycle capital and generate returns, a functioning pipeline of IPOs, trade sales and secondary transactions for technology companies is essential.
Public money as leverage
The catalytic fund’s design explicitly acknowledges this constraint. By covering first losses, it aims to de-risk entry for private investors and increase the pool of capital available to startups from pre-seed through Series A and beyond.
But the model’s success depends on whether the public anchor of 347mn dirhams can genuinely mobilise the targeted 2.5bn dirhams — a leverage ratio of roughly 7.2 times. The FM6I and CDG, both state-linked institutions, are already contributors. The critical test will be the participation of genuinely private, domestic and international investors.
TAMWILCOM’s broader strategic plan, Jossour 2030, launched in June 2026, aims to mobilise 300bn dirhams in financing by 2030 and support 435,000 beneficiaries. The plan also includes a separate 700mn dirham Startup ($73.57 million USD) Venture Building programme targeting 800 startups over three years, with monthly stipends for founders, prototype funding and loans of up to 2mn dirhams. Partners include Technopark, CEED Maroc, Flat6Labs and 500 Global.
What to watch
The first phase of Morocco’s startup finance experiment was judged a success by its principal backer. The second phase is more ambitious and more complex. Its outcomes will depend on factors that public money alone cannot guarantee: the ability of the nine selected fund managers to raise private capital, the quality of deal flow, and — above all — the emergence of viable exit routes for venture-backed companies.
Without those exits, the risk is that public catalytic capital continues to finance entry into startups that remain unable to return capital to investors, leaving the ecosystem dependent on successive rounds of state support rather than developing a self-sustaining venture capital cycle.