The first fund of COTU Ventures, an early-stage venture capital firm based in Dubai, has raised $54 million to support Middle Eastern startups from pre-seed to seed stage.
COTU Ventures, which finds and supports founders from conception to post-product launch, reached a final close last year. The firm invests between $500,000 and $2 million, with funds set aside for follow-on ventures.
With a primary focus on the United Arab Emirates, Saudi Arabia, Egypt, and Pakistan, COTU Ventures has actively invested capital in startups throughout the Gulf Cooperation Council (GCC) over the previous 2.5 years. According to its statement, the company has already invested in more than 20 early-stage startups in a variety of industries.
COTU Ventures is leaning slightly toward fintech and B2B software, as founder and general partner Amir Farha disclosed in a TechCrunch interview. Nonetheless, the company is open to opportunities in other industries. Founders Fund and Peak XV-backed UAE mortgage platform Huspy, as well as Egyptian fintech startup MoneyHash, are noteworthy investments made by COTU Ventures.
“The consumer wave happened with Careem and some other applications. Today, businesses are lagging a bit behind, so there’s a huge opportunity to build software to help solve many of their problems. We are also interested in high-margin industries where technology can play a massive role and capitalize on margin efficiencies,” said Farha on the opportunities COTU is keen on.
As a venture capitalist at his former company, BECO Capital, Farha made one of his first investments in Careem, the poster child of the MENA and GCC startup scenes.
After working for a corporate venture capital firm for a few years, where he made investments in the UK and Sweden and later ran the region’s first seed fund and angel network supported by the Dubai government, Farha launched BECO Capital in 2012. He participated in managing the firm’s strategy, investments, and firm-building efforts for its first fund, which was funded by $50 million, and its second fund, which was funded by $100 million, before leaving to start COTU Ventures.
Following Uber’s Careem acquisition, Farha and his partner at BECO Capital went back to the first fund, which has Fresha and PropertyFinder backed by General Atlantic. He also mentioned how well-capitalized companies like Kitopi and MaxAB are part of BECO Capital’s second fund, which is doing really well.
