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COTU Ventures Raises $54 Million to Support Startups in the Middle East

COTU Ventures, a Dubai-based venture capital firm, announced that it has raised $54 million for its inaugural fund to support startups in the Middle East from the pre-seed to seed stages.

With a final close completed last year, COTU Ventures, which supports founders from the beginning to post-product launch, invests between $500,000 and $2 million while retaining capital for follow-on investments.

Over the past two and a half years, COTU Ventures has actively deployed capital into startups across the Gulf Cooperation Council (GCC), focusing primarily on the United Arab Emirates, Saudi Arabia, Egypt, and Pakistan. The firm has already supported more than 20 early-stage startups across various sectors, as outlined in its statement.

In an interview with TechCrunch, founder and general partner Amir Farha revealed that COTU Ventures leans slightly towards fintech and B2B software. However, the firm is open to opportunities across other sectors. Notable investments by COTU Ventures include Huspy, a UAE mortgage platform backed by Peak XV and Founders Fund, and Egyptian fintech startup MoneyHash.

Careem, a shining star in the startup scene in the MENA and GCC regions, was one of the earliest investments Farha made as a venture capitalist at his previous firm, BECO Capital.

After several years of working in venture capital across the UK and Sweden, and later managing the first seed fund and angel network in the region supported by the Dubai government, Farha launched BECO Capital in 2012. There, he was involved in managing the firm’s investments, strategy, and firm-building efforts for its first fund ($50 million) and second fund ($100 million) before leaving to launch COTU Ventures.

Reflecting on the evolution of the investment landscape, Farha explained how BECO Capital was active in seed rounds ranging from a few hundred thousand dollars to Series B rounds of about $5 million before the ecosystem evolved to accommodate larger funds and later-stage investments. During this period, venture capital investments in the GCC region saw significant growth, rising from $20 million in 2012 to over $2 billion by 2020.

As BECO Capital shifted its focus towards later-stage investments with larger funds, Farha decided to leave in 2020 and launch COTU Ventures, refocusing on early-stage investments. This decision was driven by identifying a market gap. Despite the significant maturation of the GCC tech ecosystem in terms of capital and talent, there was still a critical need for support beyond just funding at the earliest stages of startup development.

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