Saudi Arabia-based venture studio VMS has acquired a minority stake in Egyptian start-up accelerator Cash Cows as part of a strategic partnership agreement aimed at supporting the entrepreneurial ecosystem in both countries.
The partnership aims to bring together resources, expertise and support to help the region’s start-ups grow and succeed, Cash Cows said on Sunday.
The two companies agreed to collaborate to provide resources and support for start-ups and investors in the Middle East and North Africa region.
"Supporting start-ups and entrepreneurship has become a priority for the future of the Saudi economy. This is reflected in the performance of companies and the successful financing deals achieved,” Ahmed Reda, managing partner and chief executive of Cash Cows, said.
“Supporting start-ups is an essential part of Vision 2030. Hence, our expansion into the Saudi market through our partnership with VMS is a golden gateway to enter this promising market.”
The UAE, Saudi Arabia and Egypt collectively have the lion’s share of venture capital funding in the Mena region, accounting for about 74 per cent of investments in 2022. The countries attracted funding worth $1.19 billion, $987 million and $517 million, respectively, according to start-up data platform Magnitt.
VC funding in Egypt rose by 3.2 per cent annually in 2022. However, the number of deals fell by 3 per cent to 160 last year, from 165 in 2021, the data showed.
Video: Startups in MENA are much higher than people realize
Overall, 749 scale-ups across Mena (excluding Israel) have raised more than $19.5 billion cumulatively over the past decade, a report this month by the Dubai Chamber of Digital Economy said.
The chamber defines scale-ups as start-ups that have raised $1 million or more in capital.
The partnership between VMS and Cash Cows includes the launch of a joint platform for exchanging ideas, collaboration and mutual learning among start-ups, investors and entrepreneurs.
Motaz Abuonoq, founder and chief executive of VMS, said the company’s expansion in the Egyptian market was an “important and strategic goal”.
VMS supports start-ups by providing guidance, financing, networking and investment opportunities.
Meanwhile, Cairo-based Cash Cows helps start-ups to refine their operations and create growth strategies, resulting in investment deals at different stages of financing.
Mohamed Nagaty, a partner at Cash Cows, said that the partnership with VMS will contribute to building a bridge between Egypt and Saudi Arabia for start-ups, expand the scope of operations for both companies, help discover more opportunities and support the growth capabilities of start-ups.
VMS will provide its expertise in Saudi Arabia to Cash Cows, including business development and marketing, gaining government support, legal and accounting expertise, and access to investors and financial funds.
Cash Cows’ portfolio of start-ups includes medical analysis platform CheckMe, Egyptian fuel supply platform GoFuel, health information exchange platform Healthtag, discounts and coupons platform Waffarha and education technology platform IQ, among others.
VMS’s partner list includes pharmaceutical manufacturing company Dawafast, Chart, Mobelia and iSchool.
