One unintended outcome of the “sub-Saharan Africa” classification of African countries is that North Africa is typically excluded from conversations about Africa’s tech start-up landscape. This often means we’re sharing an incomplete picture of progress being made in tech ecosystems on the continent especially given landmark events recorded in North Africa in recent years.
Bus-hailing firm Swvl raised $42 million in the largest funding round for an Egyptian start-up while Careem, the Dubai-headquartered ride-hailing start-up with vast operations in North Africa was acquired by Uber for $3.1 billion. MaxAB, an Egyptian e-commerce marketplace raised $6.2 million in what’s regarded as one of the largest seed funding rounds across the region while five year-old ride-hailing start-up TemTem raised $4 million in Algeria’s largest Series A round. There’s also enough budding local talent to sustain the growth in these ecosystems: Morocco and Egypt are ranked among the five fastest growing developer communities on the continent over the past year.
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By virtue of being regionally categorised alongside the Middle East (as MENA i.e. Middle East and North Africa), North African start-ups do enjoy a geographical advantage as they can access significant funding pools solely dedicated to the region and can expand to and operate in Middle East markets more easily than start-ups in other African regions.
Indeed, within the last two months alone, Mubadala, the United Arab Emirates’ sovereign wealth fund, has launched a $250 million fund for MENA start-ups just as BECO Capital, the Dubai-based venture capital firm, raised a $100 million fund to back start-ups in the region (BECO Capital co-led Swvl’s landmark funding round).
But North African start-ups are now looking southwards for integration into other African tech markets too: Swvl expanded into Kenya and Nigeria this year and plans to launch in more markets next year, Mostafa Kandil, the company’s chief executive, said. “We see that the problem [we are solving] is very evident in Africa and there’s unique product-market fit. We are going to double-down on Africa.”
As the African Union continues to push for more integration on the continent, a good place to start for tech industry stakeholders is to include every region in conversations and tell a more complete story.