Cairo-based Algebra Ventures’ second fund will look to back tech-enabled enterprises, female founders and startups that can generate job opportunities.
With a portfolio that includes the likes of Trella, Goodsmart, elmenus, Halan, Khazna, Brimore and many other of Egypt’s top startups, Algebra Ventures stands as one of the most prolific VCs in the country. Last year, the firm announced a new $90 million fund, one that came hot on the heels of its debut fund for years prior, one that was worth $54 million.
The latest news for ‘Algebra Fund II’ is the announcement that the International Finance Corporation (IFC) has pledged $15 million, returning to the fold as a limited partner. The fund will focus on Egyptian tech and tech-enabled startups, though on the part of the IFC - which has also directly invested in Algebra Ventures’ portfolio - it’s the potential for targeted startups' impact on job creation that has brought it back into Algebra’s equation. Managed by Laila Hassan and Omar Khashaba, who joined as General Partners in July, 2021, the fund will specifically look to target female-led startups, as well as startups impacting rural communities in Egypt.
“With its young, tech-savvy population and large market, Egypt’s entrepreneurs are perfectly poised to drive change in the country’s economy – with the right support,” said Yasmine El-Hini, IFC Egypt Country Officer and Acting Country Manager for Egypt and Libya. “With this investment, we are helping to push the country’s startup scene forward and encourage innovation.”
It’s a sentiment echoed by increasing VC interest in Egypt. In 2021, venture funding and the number of deals reached record highs, with Egyptian startups raising a combined $491 million across 147 deals. Between 2020 and 2021, deployed venture capital increased by 168%. In terms of sectors, transport & logistics lead the way by quite a margin, raking in $177 million. However, a large part of that is attributed to Halan’s $120 million mega round in, which stands as the highest ever round achieved in the sector, and Trella’s $30 million Series A in June.
An arguably more pertinent lens to look at the situation through, then, is by the number of deals. Fintech leads the way with 25 deals, and is quickly followed by e-commerce’s 23. Transport & logistics ranked in it third with 15 deals, while healthcare (12) and food & beverage (11) tailed closely behind.
And so while Algebra Ventures remains largely sector-agnostic, it’s likely that these are the very same sectors it will be looking at once the firm has reached its $90 million target - though they have not revealed how far that target still is.