Flat6labs, an Egypt-based seed and early-stage venture capital company, and the Sanad Entrepreneurship Academy plan to launch an accelerator programme that will support the development of start-ups in the agricultural technology sector.
The initiative will support up to a dozen AgriTech companies that will be given access to capital and allow them to develop their technology, which will help them address the challenges of food security in Egypt and the wider region, Flat6Labs and Sanad said on Tuesday.
‘’With digital transformation progressing rapidly across industries, and the agriculture industry being a core pillar of the Egyptian economy, the need to digitise the agriculture industry has increased dramatically," said Hassan Mansi, head of ecosystem development programmes at Flat6Labs.
The accelerator programme "will serve this need by supporting the start-ups that provide innovative technologies in the agriculture sector and will contribute to the sustainable growth of the Egyptian economy".
Egypt is developing its agricultural sector, which is a vital component of its economy.
The sector contributes more than 11 per cent to the country’s gross domestic product and accounts for about 28 per cent of all jobs, data from the US Agency for International Development shows.
The country is banking on technology and its start-up ecosystem to help grow the industry. Venture capital funding in Egypt more than doubled to $307 million in the first half of 2022 from a year earlier, ranking it third in the Mena region, according to start-up data platform Magnitt.
The number of deals in the country also grew by 22 per cent annually to 78 during the first six months of the year.
The global agricultural sector, meanwhile, is expected to grow to more than $18.8 trillion by 2026, after reaching about $12.5tn in 2022, at a compounded annual growth rate of about 11 per cent, The Business Research Company said.
Streamlining food supply chains is crucial to ensuring food security, a growing priority around the world, especially after the Russia-Ukraine conflict and supply chain disruptions.
"We believe that focusing on the agricultural sector, and specifically AgriTech, is vital in these challenging times and will contribute to increased food security across the region," said Kim Reichel, chairwoman of Sanad's technical assistance facility committee.
The collaboration between Flat6Labs and Sanad aims to address this with the accelerator programme.
Both entities believe that empowering and promoting Egypt's AgriTech sector can advance automated machinery and robotics.
This will increase the efficiency of agricultural productions by utilising several determinants, including locating nutrient availability, disease checking in crops and how to predict them, and other factors specific to the industry.
Flat6Labs manages several seed funds with more than $85 million of assets under management. The Cairo-based entity has several offices across the Mena region, with plans to expand into other emerging markets.
Sanad finances micro, small and medium enterprises and low-income households in the Mena region and select sub-Saharan countries, contributing to economic development and job creation.