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Wednesday, 19 October 2022

Catalyst launches corporate venture arm

Impact investor Catalyst Partners has launched a corporate VC arm, dubbed Serv Startup. The unit will look to acquire minority stakes primarily in the fintech and digital lending sectors, Chairman Maged Shawky told Enterprise. Serv Startup is looking at early-stage startups that have already developed minimum viable products, he said. Shawky declined to say how much the unit has to invest.

Serv Startup will be looking to acquire a “handful” of minority stakes in firms that it hopes to integrate into Catalyst Partners’ business at a later stage, provided they support the firm’s business well, Shawky said. The company is looking to make its first investment in 1Q2023, he added.

SOUND SMART- Corporate VC is what it sounds like — when established companies invest in startups. Corporate VCs often invest in startups that complement the investing companies’ operations, writes Harvard Business Review. Among the first to jump on the trend in Egypt was CIB’s CVentures.

ALSO- Catalyst’s SME-focused fund is in talks to acquire a pharma company and another in the industrials sector, Shawky said, without disclosing the names of the companies. The acquisitions are awaiting final approval from the company’s board of directors, he added. The Catalyst Capital Egypt Fund — which reached its targeted EGP 450 mn first close earlier this year — focuses on sectors that are “defensive” in terms of growth and earnings, including agricultural manufacturing, pharma, and logistics.

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