Scaling up in the rising Egyptian ecosystem

The Solution

“One of the most realistic experiences I’ve had, tough decisions, capital tradeoffs, ecosystem strategy… exactly how scaling really feels.” – Amro El-laboudy, Senior Investment Analyst , Falak Startups

Thanks, Kamelizer

Scale Up MENA! Masterclass

Day 1: starting up (the messy pre-seed and seed stages )

30 markets across MENA & global, but few can beat the life-time value of Abu Dhabi.

Day 2: scaling (venture-stage, series A-B)

Leaning into the VC ecosystem advisor collaboration. It has huge upside!

Day 3: Global expansion and MENA IPO (growth stage, series C,D, pre-IPO)

“Liquidity is in our roadmap”, nice!

What founders said

“It was impressive”

“I absolutely loved it!”

“Incredible experience”

“I have never been this engaged at work before”

“I had such a great time. What an enriching experience”

Team 5 solving their GTM strategy

“Scale Up MENA compressed years of startup growth into days, sharpening my capital strategy and exit planning. Chris’s frameworks made complex investor readiness feel actionable, and his global perspective on transformation gave me clarity on how to scale my demo company “FoodTrucky” into a category-defining company.”

– Hany Radwan, Director of People and Organization @Money Fellows, (Series B-stage)

“The way the content was broken down through simulations and different learning methods made the three intense days not only manageable, but truly enriching and memorable.

I have gained so much clarity and confidence in navigating funding opportunities, and I cannot wait to apply all of this in our upcoming investment conversations. Thank you for embracing all levels and creating such an empowering learning environment.”

– Malak Mohamed, BD Associate, Snapper

CRO at work

What investors said

“An incredibly eye-opening simulation. It gave us all hands-on experience with the chaos (ups and downs) of the founder/startup journey; the cash crunches, funding pressures, unexpected set-backs, and then the unexpected breakthroughs, that you will never get from theory alone. What was also extremely beneficial, was how your response to the challenges and opportunities you came across, impact your progress later on and how that deviated (or not) from your initial plans. I wouldn’t just recommend it, but I think it’s a must-do for any founder, employee or investor in the space, or anyone thinking of entering it.”

– AbdelRahman Mansour CEO, Egypt Ventures

“Honestly, I was a bit skeptical about attending this simulation at first. We work with founders all the time so I wondered “what else is there to learn?”. Turns out, observing founders is one thing but “living” their journey is different. This simulation gave me a first-hand perspective on what founders go through, the pressure, the trade-offs and the constant need to balance between growth and resources. It really forces you to think like a founder, be creative, make tough decisions, and navigate multiple aspects of the business at once. For investors, this a reminder that our role goes far beyond the investment. We have to be strategic partners that add value and help unlock growth opportunities, supporting founders as they go through the journey of building a successful company. For founders, this is a very good opportunity to understand the fundamentals of scaling, fundraising, and scaling a business all the way to a successful exit. This experience is valuable for anyone in the ecosystem. Whether you’re building a business or investing in one, there is a lot of knowledge and perspectives to be gained.”

– Mariam Azab, Senior Associate, Egypt Ventures

Founder tasks on secondaries can be great fun

Impact & Outcomes

Term sheets like this one from A15 can be tricky. How well do you understand the VC business model?

Key Insights

Scaling up is a very, very different skill than just starting up. Around the world, ecosystems have been focused on getting more entrepreneurs to get started, to launch, to drive first iteration of the startup journey. To get a SAFE note. To secure first revenue. Maybe even break-even. But these initial steps are not enough. Leading a high-growth startup into a successful scale up requires leadership skills; revenue velocity, a clear market expansion strategy; but also the ability to read and understand term sheets, to structure financing tools in real-time, to negotiate on complex terms with little or no preparation and the ability to think strategically from first cap table to successful exit transaction.

“The best founders know their own value. Chris (Founder, Solve intelligence) protected his cap table like gold dust. He was aware of the immense value it held. Your cap table is king. Remember this for every hire, investor and addition”; Harry Stebbings recently wrote. We could not have agreed more.

A multi-day Scale Up MENA! takes participants through the immense ups and downs of the Founder’s Journey, allowing them to feel, negotiate and structure solutions to harsh term sheets, complex deal terms and challenging market conditions; all while trying to protect and optimize the cap table for a long-term successful outcome – a skill many more Egyptian and MENA founders will need in coming years.

To quote one of the participants, “We need so much more of this.”

CFO Hazem hard at work closing Series B

Conclusion

Amazing founders scaling across MENA

Facilitator notes: Rumbi Makanga

With the pyramids as a tangible backdrop in Cairo of what it means – and what it looks like – to quite literally achieve massive scale, we ran the first ever Scale Up! MENA in Egypt with a set of founders and investors who stepped in not quite sure what to expect, but keenly aware of the need to equip more Egyptian founders to achieve the seemingly impossible.

Is it too much of a stretch to compare building a scale-up in MENA with building the pyramids? Perhaps. But these monumental structures, these elaborate tombs for pharaohs, are evidence of a sophistication of engineering achieved at a time when it feels like it should have been impossible. And yet, they did it.

Our best information places Egypt as one of the most competitive venture markets in MENA. It has the lowest seed survival rate (9% vs. MENA’s 15%). But for the startups that make it to Series A, they have a higher survival rate than startups in other MENA markets. In the brutal market realities of Egypt, many startups don’t make it, but the ones that do have proven themselves against all odds.

This then begs the question: how do we get more startups not only making it to Series A but getting to B, C, D and to eventual exit? We give them an unfiltered, in-depth, and highly practical experience of what it takes to grow a company at massive scale. No fluff. No filler. Real hands-on learning they can instantly apply to their company building.

This is what we delivered in Cairo in partnership with Falak Startups. Anyone can start a company. But it takes an incredibly astute founder to navigate hundreds of great and not-so-great term sheets across multiple stages, maintain a balanced cap table, figure out growth and revenue levers, prioritise markets, manage hiring, build a coalition of advisors – and scale at a very rapid pace. Condensing all this into 3 days is a reality check for founders and investors alike. This is far from easy. In fact, it’s incredibly challenging.

And yet, the teams cracked it. On Day 1, they all raced around like headless chickens. FoodTrucky (Egypt) tottered dangerously close to bankruptcy, and accepting a 1,5M SAFE at a 4M post valuation did nothing to help things. On Day 2, the teams figured out how to ramp up revenues. At one point CyberShield (Dubai) had so much cash that they were writing loans to other teams. But they quickly realised that they needed that cash to maintain their own pace of growth. By Day 3, the teams had mostly figured out to scrutinise their term sheets very carefully, and most of them had really figured out their scaling engines. None more so than Gulf Cyber Shield (KSA) who closed out with over $1 trillion in revenue and a mammoth valuation of just under $21 trillion (at a 15.3x valuation-to-revenue multiple).

Is it unrealistic for a MENA startup, or an Egyptian startup, to achieve that kind of scale? Definitely not. The same stubborn ambition and entrepreneurial hustle that built the pyramids is still in Egypt today. We encountered it in the founders we met. There is a lot of potential to be unlocked. This is what we intend to do over the next few years, working with aligned partners to guide thousands of Egyptian founders to scale up

“Look, all you need to do is convert these five SAFEs, clean up your ESOP, pay out one of your advisors, reset the vesting and close the five investors for the A-series syndicate. Nothing to it”

About the client

Falak Startups

Falak Startups is one of the key ecosystem organizations shaping the future of the Egyptian startup ecosystem. With a collaboration going back more than 3,5 years, Falak Startups & Strategy Tools has partnered to deliver multiple Masterclasses to accelerate the development of the wider Egyptian ecosystem, with a clear focus on high-growth companies and building better venture capital funds.

EBRD – European Bank for Reconstruction and Development – Star Venture Program

Deeply embedded in the MENA ecosystem/span>

Strategy Tools team, Rumbi Makanga, Mohammed al Rasbi & Chris Rangen.

Learn more about the Scale Up MENA Masterclass here.