However, challenges remain, including a small local market, limited early-stage funding, and the need for increased international venture capital interest.

Cyprus-based venture capital firm 33East has launched its first fund, achieving a first close of 26 million euros.

Investment per company will range from 500,000 to 1 million euros, with an additional 2.5 million euros allocated for an acceleration program to support early-stage entrepreneurs.

Cyprus's tech ecosystem is expanding, particularly in Limassol and Nicosia, attracting startups due to its strategic location and favorable tax regime.

This initial funding consists of 19 million euros from the Cyprus Equity Fund, part of the National Recovery and Resilience Plan, and 7 million euros from private investors, including a 2 million euro contribution from the Bank of Cyprus.

33East is notable for being the first venture capital fund in Cyprus to receive backing from the European Investment Fund, with additional support from the government and local investors.

The fund aims to invest in pre-seed and seed-stage startups connected to Cyprus, providing capital, support, and a network to foster innovation and entrepreneurship.

Key sectors showing growth in the region include fintech, blockchain, and gaming, with established companies like Wargaming operating in Cyprus.

Local initiatives such as Leap Cyprus and the Cyprus Seeds funding program aim to bridge the gap between research and commercialization, while accelerators like Gravity Ventures and RISE foster entrepreneurship.

The launch of this fund represents a significant development for Cyprus's startup ecosystem, promoting innovation and entrepreneurship.

Co-founders Demetrios Zoppos and Yiannis Eftychiou have expressed a vision to transform Cyprus into an innovation hub, emphasizing their commitment to helping founders scale internationally.