Sawari Ventures and Algebra Ventures stake $150m on North African startups

One billion Egyptian pounds. That is how much Sawari Ventures raised for its Egypt-based fund. The fund has plans to ramp up investments in startups across the North Africa region.

Depending on the prevailing conversion rate, Sawari’s raise is at least $63 million or up to $71 million. Either way, it is a giant leap for the fund launched in 2018 as the Sawari Ventures Fund I.

Investors in the fund include the CDC Group (which committed $12 million), European Investment Bank, Proparco, and the Dutch Good Growth Fund. 

The fund’s newer investors include Egyptian banks like the National Bank of Egypt, Banque Misr, Banque du Caire, and Suez Canal Bank. Misr Insurance Group, based in Cairo, and Kuwaiti company Ekuity are also in the mix.

Sawari was founded by Ahmed El Alfi, Hany Al-Sonbaty, and Wael Amin in 2010. Egypt, Morocco, and Tunisia are the firm’s focus countries.

The firm’s portfolio includes Swvl (the bus-hailing startup that raised $42m in 2019), Instabug, Elves, and MoneyFellows, a rotational savings app that closed a $4m Series A last year. 

In addition to these, Sawari is focused on fintech, health, and education. But the company also sees “unique opportunities in SaaS products, semiconductors and IoT,” according to a company spokesperson’s statement to TechCrunch.

Here’s a breakdown of how Sawari will invest its new fund, according to TechCrunch:

• 10% will be passed through Flat6Labs, Sawari’s seed-stage-focused firm. Through Flat6Labs’s offices in Cairo and Tunis, Sawari will provide seed capital to at least 140 startups in the region and follow-on investments in up to 60 companies. 

• The remaining 90% will go into 20 to 25 growth-stage companies across Egypt, Tunisia, and Morocco. The median ticket size for these investments will be between two and three million dollars.

Not to be outdone, another VC firm will also be offering ticket sizes of up to $2 million to startups within the North Africa region. 

Algebra Ventures, a firm based in Egypt, plans to raise a $90 million fund. They plan to close the first round of that target by the third quarter of 2021.

According to a company statement, Algebra raised a $54 million fund in 2017 and deployed it in about 21 startups. The company says its 6 most established startups are valued at $350m. Their portfolio includes Eventtus, a digital event management startup, a trucking marketplace called Trella, and Goodsmart, a grocery shopping app.

With its new fund, the company will pursue fintech, agritech, edtech, logistics, and healthcare opportunities. The firm plans to establish itself among “exceptional” seed level founders “and “expand our participation on the Series B level, too,” according to Karim Hussein, who co-manages the firm with Tarek Assad, his co-founder.