The Ripple Effect: 7 Things That Happened in the Entrepreneurial Scene After RiseUp 2015
Ahead of the 2016 RiseUp Summit, we take a look at the cornerstone events the entrepreneurial summit sparked last year, a testimony and a promise of their ever-growing ripple effect.
As RiseUp gears up to kick off its 2016 edition under the theme of 'Fusion', the concept of a chain reaction came up as the unequivocal conceptual nod guiding its every gig. Because if there is one thing RiseUp 15 proved, it's that the movement’s impact has a ripple effect, and the figures prove it. 2016 was a game-changing year for startups in the Middle East – it was the year RiseUp Summit brought the world to Cairo; the year Fintech got a massive boost; the year that saw flows of funding getting into the ecosystem and benchmark seed rounds for startups, catapulting Cairo to one of the startup capitals not only in Egypt but also the Middle East.
In the meantime, just as they steel themselves to make their yearly summit even bigger, the disquiet team behind the RiseUp Summit launched new services, one after the other, in a move that consolidates them as the one-stop platform to connect startups – Egyptians or not – to worldwide resources. After launching the first RiseUp MeetUp in Alexandria in parallel to the Techne Summit, they took it to Berlin, where they also spearheaded RiseUp Explore, taking the first eight startups to attend a global event: Tech Open Air. But what else has happened in the startup world since then?
1. FINTECH STARTUPS GOT A BOOST
It was early this year when Payfort announced the launch of its regional financial technology accelerator, the Fintech Factory; a couple of months later, Amman-based peer-to-peer lending network Liwwa raised $2.3 million.
But the sector got a particularly important boost in Egypt, where soon after came 1984, the first local Fintech-focused accelerator of its kind in the country, born out of the fusion of two giants: Flat6Labs and Barclays. With themed ideation sessions, a FinTech Hackathon, business focused bootcamp and workshops. A month later, Egypt’s largest private bank – CIB – joined in the wagon, partnering with the American University of Cairo to launch the AUC Venture Lab FinTech Accelerator.
2. UP-AND-COMING EGYPTIAN STARTUPS RAISED FIRST ROUNDS
For emerging Egyptian startups, 2016 brought along a flow of seed funding that saw plenty of promising businesses catapulted into the helm of economic change. Early in May, solar energy pioneer Karmsolar secured $1 million to finance three solar stations in Egypt, and shortly after announced the launch of Egypt’ first solar-powered electricity station, in a deal that marked the first private power purchase agreement (PPA) between a solar company and a private client to sell the electricity the station generates.
As the first RiseUp Explore kicked off at Berlin’s Tech Open Air in the summer, the platform curating babysitter services since 2013, CairoSitters, announced their re-launch as Orcas and signed locally-based venture Kamelizer as one of their investors. But one of the milestones for the local tech startup scene came in September, when Ousta, the car-hailing app that valiantly stepped up to compete with Uber and Careem, secured a $1.25 million round led by an Egyptian VC, just five months into their launch, in March 2016. But as the year unfolded, they were followed by many more:
- Egyptian job search engine Cantalop closed a seed funding round of $100,000.
- Instabug raised a $1.7 million seed round led by Accel Partners.
- IT platform Greeks raised a $600 seed round.
- Friendture, the app for group plans, raised their first seed investment from Oasis 500.
- Boxit received a seed investment of $600,000.
- Wrappup closed a $800,000 investment round.
3. ARAB STARTUPS SECURED MILLION-DOLLAR INVESTMENTS
Entrepreneurs saw both an international and regional explosion of funds, not only in the Middle East but also in Africa, such as Afrimarket, which nabbed $11 million for their regional expansion, and Holiday.me’s $7 million funding. Across the region, the figures raised eyebrows:
- Egypt's Smart Care secured $1.2 million from the Egyptian-American Enterprise Fund’s (EAEF).
- UAE’s Reserveout raised a Series A round for $4 million.
- Turkish on-demand logistics platform Kapgel nabbed a $1million fund.
- Movesouq closed a $3 million round by Russia-based VC Addventure.
- Nomadd raised a $1 million Series A round.
- Reserveout raised a $4 million Series A round.
- Compareit4me closed a $2.4 million funding round.
- Eat raised a post-seed round of $2 million.
- Wamda Capital invested $2.2 million in Istanbul-based Insider.
- Big Basket nabbed a massive $150 million investment led by Abraaj Group.
- Dubai-based The Luxury Closet closed a Series B round of $7.8 million.
- Chrono Therapeutics closed a $47.6 million Series B investment deal.
- BitOasis became the first bitcoin startup in the region to announce venture funding, led by Payfort.
4. NEW FUNDS FOR STARTUPS EMERGED
As Flat6Labs consolidated its expansion in the Middle East - adding Tunisia to its ever-increasing arms in Saudi Arabia, UAE, and Lebanon - it announced a $5.6 million investment fund early in March, in cooperation with the Social Fund for Development.
It was in October that the incubator took it to another level, announcing a $1 million deal with the World Bank investment arm, the International Finance Corporation (IFC), a fund that will help Flat6Labs close a $ 5.6 million fund to launch around 100 startups over five years. Exciting news continued to hail from Egypt in June, when Ideavelopers – a venture capital firm under the umbrella of EFG-Hermes - launched a new $50 million venture capital fund named Algebra Capital.
Perhaps one of the cornerstones of the year was Saudi Arabia’s move away from an oil-dependent economy towards becoming the world’s leading tech investor, with a fund launched with SoftBank that would potentially reach $100 billion. And among other buzzing announcements:
- 500 Startups joined forces with Qatar Foundation to launch their MENA fund.
- Turn8 announced a new $60 million VC fund.
- Dubai launched the AED1 Billion Future Accelerators programme.
5. UP-AND-COMING STARTUPS CHAMPIONED THE GAME
Many startups mastered the crowdfunding game, such as the Egyptian-born pocket-sized drone Drofie, which raised $26,000 in a crowdfunding campaign on Kickstater. A crowdfunding platform itself, Eureeca also closed a funding round – on its own platform – of $400,000 in just 12 days. Leaping into the global scene and nabbing awards and competitions, several startups upped the entrepreneurial game.
- Mind Rockets, the startup developing sign language, was chosen to compete at Swiss Summit.
- Snapp opened up ride-sharing in Iran, with €20 million funding.
- Beirut-based Myki launched authentication solution at Techcrunch Disrupt.
- A15 and Kijamii joined forces to create the biggest social media group in MENA.
- Egyptian app Raye7 was voted as the world's second best mobile app at Barcelona's World Mobile Congress.
- Affectiva partnered with Giphy and opened its emotion-sensing API to small businesses.
6. NEW PLAYERS SHOWED UP
From incubators to media hubs, innovative actors have continued to spring across the startup world, from Saudi Arabia to Egypt and UAE, including Dubai’s promising Global entrepreneurship network 1776. Others included:
- Incubator In5 Media Hub kicked off with a focus on media.
- ITIDA selected Borg El-Arab, in Assiut, to spark innovation centres outside Cairo.
- Startup incubator 9/10ths launched in Saudi Arabia.
Few stories made waves as much as Parlio’s acquisition by Silicon Valley giant Quora. Its founder, Wael Ghonim, one of the iconic faces of the 2011 revolt – who had already reaped international notoriety when he joined Google Ventures and was nominated for the Nobel Peace Prize – made headlines once again as his startup gained global traction. But Parlio was just one of many success stories in 2016:
- Dubai tech start-up Media.net acquired for $900 million.
- El Grocer acquired QUICKSHOP.ae and merged into their live ordering platform.
- South-African payment facilitator PayGate received R100-million in funding.
Photography by @MO4Network's #MO4Productions.
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