Algebra Ventures, Egypt’s VC Firm Finalizes the First Close of its $100m Second Egypt-Dedicated Fund

Algebra Ventures, Egypt’s VC Firm Finalizes the First Close of its $100m Second Egypt-Dedicated Fund

Algebra Ventures, Egypt and MENA-focused venture capital firm has announced the first close of its $100 million second fund.

This comes just months after the venture capitalist announced the launch of its $90 million second fund in April. It was the follow-up to its first fund, which invested $54 million in 21 startups across the MENA region.

Investors in Algebra Ventures’ second fund include large institutional investors, including DFIs such as FMO, BII, and IFC, is backing Algebra’s second fund — the IFC and FMO committed $15 million and $10 million, respectively, to the fund. Other limited partners include the EBRD and EAEF, as well as new investors, MSMEDA, DGGF, and a few regional family offices.

According to the partners, Algebra plans to invest $15 million by the end of this year, or within its first year of operation and expects to close by the end of Q1 2023. It has so far invested in four startups, including Sylndr, an online used-car retailer that raised the largest pre-seed investment in Africa this May, totaling $12.6 million. Furthermore, while Algebra’s second fund will look for opportunities in East and West Africa, its primary focus will remain on Egypt.

What Algebra’s Managing Partners are saying

“Algebra’s investors were among the first believers in the potential of the Egyptian VC market, having invested in our first fund six years ago when there was almost no venture capital to speak of in Egypt,” said Tarek Assaad, Managing Partner at Algebra Ventures. We’re excited to continue collaborating with returning investors as well as new LPs who are supporting Algebra’s local and regional expansion plans. We have learned from experience that technological innovation, particularly in turbulent times, has enormous potential to transform people’s lives and generate significant economic value. This is an excellent time to start a business.”

The fund’s vision is to support and finance daring entrepreneurs who create innovative and scalable high-growth businesses that will advance Egypt’s long-term economic growth.

Also commenting on the firm’s efforts to raise its second fund, Karim Hussein, Algebra Ventures managing partner said “This is a testament to the potential of tech entrepreneurship in Egypt. Even in these uncertain times, there will be funding to back founders who are building transformative companies. The upside is still very significant and successful, well-funded companies will be in a position to become market leaders, even in challenging economic times. It also highlights the importance of local funds, working closely with entrepreneurs on the ground. We’re four partners, all Egyptians, all living in Cairo; we’ve been investing for a long time, and we understand the local environment. We’ve seen startups succeed and others fail, and many regional and global investors think of us as their local partner in Egypt.”

Algebra Ventures’ Investment in Egypt so far

Algebra Ventures is one of a few firms that have recently completed the first or final close of large funds aimed at the Middle East, alongside ADQ-backed Further Ventures and Endure Capital. It is also arguably Africa’s largest indigenous fund, and it is listed alongside well-established funds investing in African growth-stage companies such as Partech Africa, TLcom Capital, Norrsken22, and Novastar Ventures.

Algebra Ventures has backed Egypt’s top startups in a variety of industries since its inception in 2016. Names like Halan, Brimore, Trella, elmenus, Khazna, Yodawy, Mozare3, and Shift EV are among them.

Tarek Assaad and Karim Hussein are the managing partners of Algebra, and Laila Hassan and Omar Khashaba are the general partners.

Algebra has already invested in four startups as part of its second fund including online used-car retailer Sylndr and is finalizing a few other investments. Algebra has previously invested in startups and category leaders including Trella, Khazna, Mozare3, Shift EV, elmenus, Halan, and Yodawy.