More startups in Egypt have raised funds from investors than in any other country in the whole of North Africa and the Middle East (MENA) in the first quarter of 2020 (January-March), according to a report issued by MAGNiTT startup Intelligence agency which produces startup funding reports for the MENA region. Egypt is also top in the number of nationals founding startups in the region,
Here Is What You Need To Know
- According to the report, Egypt recorded the largest number of deals, accounting for 37% of the total deals in the region, Saudi Arabia, the second fastest growing startup environment, accounted for 24% of all deals made.
- Egypt has witnessed a major explosion in the number of new businesses in the last two decades. The number of people involved in the startup scene has almost tripled from 4.9% of the population in 2008 to 13.5% of the population in 2018.
- According to the report, despite the disruptions from COVID-19, the amount of financing announced for startups in the Middle East and North Africa actually increased by 2% compared to the same period in 2019, to reach $277 million in 108 projects and startups across the region.
- Engineer Hala El-Gohary, CEO of Egypt’s Information Technology Industry Development Authority (ITIDA), pointed out that the authority places the focus of entrepreneurship in the field of information and communications technology within its Egypt’s 2030 Vision which seeks to make the country as a major digital, IT, and AI center of the region.
- She added that the authority aims to enhance Egypt’s position on the global map of entrepreneurship and technological innovation by doubling the number of companies operating in this field in Egypt.
Why Egypt Is A Top Destination For Startup Investors In MENA
- MAGNiTT Intelligence Research Unit found that the climate and business environment for startups in Egypt has become one of the best markets in the Middle East and North Africa region.
- The report also shed light on the multiple advantages that Egypt enjoys in this field, including increased government support, as well as its population exceeding the barrier of 100 million, which represents 17% of the total population in the region, providing a large market for companies in the initiate phase of sales. Not to mention that Egyptians seem to be the most motivated to seize the opportunities presented by startups, which the report described as being less evident in Gulf markets.
- This is backed up by a recent report issued by Wamda, a multi-stage investment platform aimed at accelerating and incubating environments for entrepreneurship in the MENA region, which stated that Egyptians came in first place with a significant difference from their counterparts with regard to the nationality of the founders of startups in the region by 25.7%, while the Jordanian nationality came in second place with 12%, followed by Indian nationality in third place, 7.1%, and Lebanese came in fourth with 6%.
- The report, which was titled “The state of startups in its initial stages”, indicated that Egypt also came first with 33% as the most country in which startups were created and registered, and the UAE came second with 27%, followed by Jordan with 11%, then the United States of America by 6%, and the report also ranked countries that are a center for startups in the initial stages, as the UAE came first with 35%, followed by Egypt in second with 25.6%, then Jordan with 10.4%, Lebanon by 5.9%, and Saudi Arabia ranked fifth by 4.7%.
- Start-ups have yielded some new and innovative businesses to Egypt’s economic environment. While there is a lot more room for improvement, the number of successful companies in AI, renewable energy, IT, and other new generation technologies gives some indication of the future of Egypt’s business scene, both at home and abroad, if these companies continue to be supported.