New IFC & SFD Investment in Flat6Labs Supports Entrepreneurship and Innovation in Egypt
Cairo, Egypt, December 15, 2016 — Flat6Labs, the leading regional early-stage investment company announced today the participation of the International Finance Corporation (IFC)- a member of World Bank Group, through its “Startup Catalyst” initiative, and the Social Fund for Development (SFD) as the lead investors in its EGP 75 million Egypt-focused venture capital seed fund.
IFC will provide up to $2 million in equity financing to Flat6Labs Cairo, which will invest in about 100 Egyptian tech startups and support more than 300 entrepreneurs over the next five years. Egypt’s Social Fund for Development (SFD) is another lead investor in Flat6Labs. Through its structured, four-month accelerator program, Flat6Labs will provide seed funding, strategic mentorship, and networking opportunities, helping entrepreneurs and their startups become investment-ready.
“We’re very excited to have received the support of IFC, through its Startup Catalyst program, and the SFD, through its first investment in an accelerator program,” said Ramez El-Serafy, CEO of Flat6Labs. “Their support and trust in Flat6Labs’ track record and its ability to enable seed-stage startups is wonderful. It will help create opportunities for young Egyptian entrepreneurs and is a great testament to both our funding model and IFC’s commitment to pursue economic growth in Egypt.”
“Egypt has tremendous long-term potential, given its large workforce, strategic location, and well-established manufacturing sector,” said IFC’s
CEO, Philippe Le Houérou. “The country’s recently announced economic reforms will help it capitalize on that promise — by breathing new life into the private sector, which can drive innovation and employment, and create lasting opportunities for all Egyptians.”
The Egypt-focused fund managed by Flat6Labs will support up to 20 startups a year with an average seed investment of 350,000 Egyptian pounds, bolstering the startup ecosystem and supporting innovation and job creation.
“Unemployment is a threat that we need to address in order to alleviate poverty and improve the living standards of Egyptians and particularly our youth,” said Nevine Gamea, SFD Managing Director. “Supporting small businesses and helping them grow and access capital is a strong driver of job creation and, in turn, economic growth. As such, the SFD worked closely with the World Bank experts to develop sound investment processes to enable it to invest in and support youth with innovative ideas and businesses”
To date, Flat6Labs Cairo has invested in 54 companies, including Instabug, a platform for mobile developers that has attracted more than 400 million users over three years. The business was recognized as one of the top Egyptian startups by Forbes magazine.
Small and medium-sized companies in Egypt contribute 75 percent of private sector employment and 25 percent of gross domestic product. Support to SMEs is an important focus area of the World Bank Group’s new Country Partnership Framework for Egypt for 2015–2020, and part of IFC’s strategy that aims to strengthen the country’s private sector and spur job creation through supporting the MSME sector.