Egyptian Startup Pylon Secures $19M Seed Funding

The seed round for $19 million has been secured by Pylon, e-Infrastructure, an Egyptian platform for infrastructure management to develop market water and energy utilities.

Endure Capital, based in the United States, led the transaction, which was funded by British International Investment (previously CDC Group), the UK government’s development finance organization. The participants include Loftyinc Ventures and Cathexis Ventures.

Pylon currently has operations in Egypt and the Philippines. Pylon will use some of the initial investment to expand into new regions like Africa, Latin America and Southeast Asia.

This is the firm’s first venture round of funding. According to Ahmed Ashour, CEO, and Omar Radi CTO, Pylon has been self-funded since 2017.

Ashour has been working in the utility and metering industry for more than a decade. He is responsible for the implementation of smart meters, including hardware, for various organizations across Africa, Europe and Asia.

According to Pylon’s CEO the company solves many problems in water distribution companies. They have a high rate unpaid debt and therefore lose a lot of money.

They pay a lot for energy and must deal with water theft. As a result of law enforcement or poor maintenance, thirdly technical losses can occur to the grid and network.

These three issues result in these businesses losing 40% revenue. They are unable to upgrade their solution, or set up a smart infrastructure, due to high expenses.

Pylon designs solutions for water distribution companies to help them become more productive and manage their costs. Pylon estimates that billions of dollars are being lost every year in emerging countries. It’s a huge potential to boost those utilities’ total revenues and top line by 50%.

Pylon’s software collects data from the grids, analyzes it, and pinpoints where supply chain theft and losses occur. It then automates the organizations’ invoicing processes, much like telecom providers in these markets have done in the past.

Pylon claims it can reduce utility business losses by 8%, while increasing their bottom line. This is without having to spend any upfront.

According to the business, there is no upfront fee for customers who purchase the gear. Its smart metering-as-a-service (SMaaS) model, on the other hand, makes it simple for cash-strapped utility firms to install its solution on a large scale.

Pylon’s revenues increased by 3.5 times in 2021, and the company believes to be profitable. Apart from developing a successful company, the founders are concerned about how Pylon’s smart electrical networks contribute to environmental sustainability.

The Y Combinator-backed company estimates that there is a market of more than $20 Billion for water and energy distribution services in ten emerging countries.

The company is currently focusing on quarter of this total, which also includes Brazil, Egypt, Brazil, and Africa. According to Ashour, the Egyptian company’s current ultimate goal is to gain greater market share over time, and an extension to Southeast Asia, another fragmented market, is in the works.

Access to clean water and energy remains a significant problem for most Africans. Companies are actively looking for new opportunities.

The most effective people are those with local knowledge, who have identified viable solutions for their particular areas and are already taking necessary steps to ensure energy and water supply solutions.

These businesses offer solutions to these problems, but they also create new concepts to make it easier for their residents, while reducing carbon emissions. Pylon is one example of such a company.

One of Pylon’s objectives is to reduce total Carbon footprints by 1 gigaton by 2035. However, water losses in developing markets exceed 45 millions cubic meters per hour.

According to the company, Pylon can reduce this amount by up to 22%. This will provide enough water to supply more than 40 million people.

Egypt has had a market vacuum for years, and Egypt is no exception.

These companies used software created for developed economies with distinct needs and issues than Siemens, Oracle, and SAP, which couldn’t match the requirements of distributors in developing markets.

Pylon is already used by more than 12 utilities, seven private and five public. They serve more than 1 million meters in Egypt and the Philippines.

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