TLDR:
- Egyptian startups have traditionally expanded towards the Middle East, but Africa may offer a competitive edge.
- Egypt has been a dominant player in the larger Africa ecosystem and the MENA region.
For Egyptian startups considering expansion, Africa may be where they have a competitive edge. Egypt has been a dominant breeding ground for startups in the region, attracting venture capital deals and funding. The country plays a major role in both the Africa ecosystem and the MENA region, ranking among the top players in both regions.
While global liquidity has benefited emerging markets like Egypt, the VC winter in 2023 resulted in a decline in the number of deals signed. Egyptian startups are now faced with the challenge of either cutting costs or expanding revenue to survive. Expanding revenue can be achieved through avenues like fundraising, increasing prices, or expanding the consumer base.
When it comes to geographical expansion, Egyptian startups traditionally looked towards the Middle East due to perceived ease of doing business. However, investors suggest that focusing on the rest of Africa may offer more opportunities. Egyptian startups that build strong products in Egypt may better succeed in African markets where similar problems are present.
Investors emphasize the potential of African markets for Egyptian startups and believe that Egypt should be a hub for expanding into Africa. There is a growing trend of Egyptian startups being acquired by other African companies, signaling opportunities for expansion in the continent. Despite challenges, African markets are becoming increasingly attractive for Egyptian startups to compete and succeed.
