Nawy Raises $52M to Expand Proptech Leadership in MENA

Transforming Egypt's Real Estate Landscape

Historically, acquiring property in Egypt involved a complex and often opaque process. Individuals typically depended on personal connections, navigated commission-based brokers, and encountered developers prioritizing sales over client satisfaction.

In 2019, Mostafa El Beltagy established Nawy with the goal of introducing greater clarity and streamlined processes to this market. Currently recognized as Africa’s leading proptech platform, Nawy has secured $52 million in Series A funding.

Securing Significant Investment

This funding round was spearheaded by Partech Africa, a venture capital firm specializing in African investments, and serves as strong validation of Nawy’s integrated approach – combining property listings with comprehensive brokerage services.

The total funding now reaches $75 million, incorporating $23 million in debt financing from leading Egyptian banks. This represents one of the largest Series A investments ever received by an African startup.

Prior to this, in 2022, Nawy successfully raised a $5 million seed round, led by the Sawiris family, Egypt’s most affluent family.

The Genesis of Nawy

El Beltagy’s venture into the proptech sector was motivated by his own difficulties. Following a career in corporate roles internationally, the former Vodafone executive sought to invest in Egyptian real estate.

Many consider the Egyptian property market a safeguard against inflation and currency depreciation.

Addressing Market Inefficiencies

However, El Beltagy quickly identified significant issues, notably a lack of transparency and the prevalence of subjective guidance during the property acquisition process.

“The ability to gain a comprehensive overview of the market was absent. Information was only accessible by contacting developers individually, collecting their marketing materials, and questioning their sales teams – a remarkably inefficient method,” explained the CEO.

“Within this industry, there’s a clear incentive for individuals to steer you towards specific options.”

Nawy’s Integrated Solution

These challenges prompted El Beltagy to create Nawy, a platform designed to facilitate property buying, selling, investment, financing, and management. Its unique model, integrating a property listing platform with brokerage services, distinguishes it within an industry still largely reliant on traditional, offline agent networks.

The company was co-founded with Abdel-Azim Osman, Ahmed Rafea, Mohamed Abou Ghanima, and Aly Rafea.

Expanding Access to Real Estate Opportunities

Initially, Nawy encountered challenges in obtaining property listings. Developers expressed doubts regarding the platform’s ability to generate sufficient traffic to their offerings, given its relatively new status. Simultaneously, real estate brokers perceived Nawy as a potential rival within the market.

To establish credibility and foster collaboration, Nawy implemented a system of immediate commission payments. These payments were provided upfront to brokers completing their initial transaction through the platform. This initiative successfully altered perceptions and spurred organic growth through positive referrals.

Currently, over 3,000 brokerages are actively utilizing Nawy Partners, the platform’s dedicated brokerage product. They benefit from access to real-time inventory data and adaptable payout structures.

Significant Market Presence

The Cairo-based proptech company attracts more than one million unique visitors each month. This substantial audience creates a competitive environment, with numerous developers vying for increased visibility.

Approximately 150 developers represent the majority of Egypt’s new construction market. This market is estimated to be worth around $30 billion, based on an annual volume of 100,000 transactions, as stated by El Beltagy.

Evolution into a Comprehensive Ecosystem

Over recent years, Nawy’s services have broadened beyond simple listings and brokerage. The company has transformed into a comprehensive real estate ecosystem, offering a wider range of solutions.

This expansion includes Nawy Shares, a fractional ownership program. This allows individuals to invest in property with a minimum investment of $500, thereby making real estate investment accessible to Egypt’s middle-income earners who have historically been excluded.

Innovative Financing Solutions

Furthermore, Nawy has introduced a mortgage product called “Move Now Pay Later.” This is designed to facilitate property purchases through installment plans and various financing options.

This offering addresses a significant gap in the Egyptian market, where traditional bank loans for real estate are infrequently available. El Beltagy believes this product will encourage a shift in the market dynamic.

“It’s a mortgage presented in a new format, as conventional mortgages are scarce in this region,” El Beltagy explained. He also noted that Nawy’s $23 million debt facility provides the financial backing for this innovative offering.

• Key Feature: Immediate commission payments for brokers.
• Market Value: Egypt’s new build market is valued at approximately $30 billion.
• Investment Access: Nawy Shares allows investment with as little as $500.

Resilient to Economic Fluctuations?

Nawy has successfully broadened its income sources, reporting over a 50-fold increase in revenue when measured in US dollars over the past four years. This achievement occurred despite a substantial 69% devaluation of the Egyptian pound.

According to El Beltagy, a significant driver of this expansion is the market’s inclination to view real estate as a safeguard against both inflation and currency depreciation. Although the currency crisis did affect domestic demand, an increase in remittances from citizens working abroad helped to counterbalance this decline.

Consequently, Nawy concluded 2024 with a gross merchandise value (GMV) exceeding $1.4 billion, a considerable rise from the $38 million recorded in 2020.

Bolstered by this new investment, Nawy intends to extend its operations beyond Egypt, focusing on North Africa and the Middle East – regions experiencing rapid growth as promising real estate markets. Morocco, Saudi Arabia, and the UAE are identified as key target markets for expansion, with the UAE already hosting established platforms like Huspy and Property Finder.

El Beltagy indicated that strategic acquisitions of smaller firms are also planned. The recent purchase of the property management startup ROA, now operating as “Nawy Unlocked,” exemplifies this strategy and broadens the company’s service portfolio.

The Series A funding, secured in two phases, will be allocated to these initiatives, encompassing both advancements in product development and the integration of artificial intelligence throughout Nawy’s operational processes, as stated by El Beltagy.

Additional investors in this funding round include Development Partners International’s Nclude Fund, e& Capital, Endeavor Catalyst, HOF Capital, March Capital Investments, Outliers, Plug and Play, Shorooq Partners, VentureSouq, and Verod-Kepple Africa Ventures.

Tidjane Deme, general partner at Partech, expressed enthusiasm, stating, “We are pleased to back Nawy as they establish a modern, technology-focused real estate platform.” He further highlighted the team’s strong market understanding, ambitious expansion goals, and effective implementation, positioning them as a leading proptech company in Africa and the Middle East.

Key Investment Highlights

• Revenue Growth: Over 50x increase in dollar terms in four years.
• GMV: Exceeded $1.4 billion in 2024.
• Expansion Plans: Targeting Morocco, Saudi Arabia, and the UAE.
• Strategic Acquisitions: Acquisition of ROA and rebranding as “Nawy Unlocked”.

The company’s ability to thrive amidst economic challenges underscores the enduring appeal of real estate as a stable investment, particularly in emerging markets.