One of the signs of a maturing startup ecosystem is the increased participation of angel investors – wealthy individuals that invest in startups to help them kickstart their operations and accelerate their growth.
Often, these angel investors come from a wave of earlier successful entrepreneurs that have exited their own startups, which netted them a large sum of money to help other entrepreneurs in the early stages of their venture. Hence, since these angel investors have been around for some time, it is a sign of a maturing ecosystem.
One of the countries in the Middle East that has seen an increased reliance on and participation of angel investors, is Egypt.
This denotes a shift in perspective of entrepreneurs, who see angel investors as fellow entrepreneurs, who have already experienced and know what it is like to run a startup in the country, and what it takes to succeed.
Founded in 2012, Cairo Angels now has over 45 investors in its network. Till date they have invested $2.4 million in 24 startups across 6 cities. This might not seen much as seed stage ticket sizes in the MENA region have been growing; however, with a smaller pool of startups since its foundation, there is still a long way to go.
Some of the startups they have invested in include Instabug, Integreight, Elves, Eventtus, Zoomaal, Iqraaly, Orcas, Bosta, Cryptyd, Play3arabi, Taskty, HireHunt, Simplex, Natures Market, Go Ejaza, Tagaddod, Books.com, Elwafeyat, Simpion, Konnecti, Financial Services Company, AlMaqarr, Buseet, and Itchable.
As reported by VentureBurn, Muhammed Hegazy, investment associate at Cairo Angels, says that six of the startups they have invested in, namely Instabug, Eventtus, Orcas, Buseet, Taskty and Play 3arabi, “have shown really good growth post investment,” some of which have also seen investments in second and third funding rounds
Cairo Angels have not yet seen any exit, even though Hugazy revealed that they generally look at an investment horizon of 3-5 year.
Cairo Angels only accept straight equity as convertible notes, with ticket sizes ranging from $50k to $120k for an equity of 15-25%.Muhammed Hegazy, investment associate at Cairo Angels said to VentureBurn
With Cairo seeing the exponential growth of Swvl, Buseet and other startups, the startup pool is growing. The Egyptian ecosystem accounted for 22% of all startup investments that took place in 2018 according to MAGNiTT, indicating that it is the fastest growing ecosystem in the region—and of course the angel investors have played a strong roll in making this happen.