GIZ, Endure Capital, Changelabs launch programme for first-time VC funds

EGYPTGIZ Egypt, in partnership with Endure Capital and Changelabs, has launched the “VC University” programme, targeting first-time venture capital (VC) funds.

GIZ works in Egypt on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).

Endure Capital is an early-stage investment fund headed by entrepreneurs looking for startup teams.

Changelabs offers a unique way to get students, youth, communities, and businesses to launch transformational impact-centered business in the 21st century.

The year-long programme, which is expected to trigger €100 million (US$120 million) worth of investments, will offer prospective fund managers mentorship as well as access to different LPs from across the world. Egyptian Micro, Small and Medium Enterprises Development Agency (MSMEDA) will join the programme as observers.

“Besides cash, the programme is designed to educate early-stage fund managers on how they can raise capital or deal with challenges that might surface up down the road,” said Ali Saleh, head of young enterprise finance at GIZ Egypt.

Lack of access to early-stage financing remains one of the key challenges facing startups in Egypt as well as in the wider Middle East and North Africa region (Mena) region.

The initiative, according to Saleh, is aimed at boosting cash flow into the risk capital ecosystem, and thus increasing cash injection in Egyptian startups, especially those at their earliest stages.

Much like early-stage startups, early stage VC funds also face challenges when it comes to raising capital and are found to be largely underserved. This is where the newly launched initiative attempts to bridge the gap.

“There’s a lot of programmes out there that are aimed at startups, yet the VC funds are left behind. We have seen that there’s a gap there that needs to be filled,” said Saleh.

The VC University programme targets both Egypt-based funds or those located elsewhere across Mena – as long as they have a clear mandate to invest in Egyptian startups. It looks to onboard three to four fund managers, who will receive €25-30 million (US$30-36m) each.

GIZ Egypt is currently working on the details of the VC University programme as part of the activities of the “Access to Financial Services for Small and Medium Enterprises” (PAFSME) project, implemented in collaboration with the Financial Regulatory Authority (FRA).

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