BY Venture Partners Closes $60M Fund III to Back AI-Native Startups

BY Venture Partners team: Abdallah Yafi, Sohrab Jahanbani, and Ghaith Yafi

Dubai-headquartered BY Venture Partners has closed its third fund, Fund III, at US$60 million, elevating its total assets under management to over US$200 million.

Anchored by the state-backed Dubai Future District Fund, alongside participation from MultiLane, Transmed Capital, and Saudi Arabia’s Idriss Family Office, the vehicle targets early-stage AI-native software companies from Pre-Seed through Series A.

Ticket sizes will cap at US$1 million across an intended 40-company portfolio, with 15 initial investments already deployed.

How Much Did BY Venture Partners Raise for Fund III?

Dubai-headquartered venture capital firm BY Venture Partners has closed its third fund, Fund III, at US$60 million, bringing the firm's total assets under management (AUM) to more than US$200 million.

The fund is anchored by the Dubai Future District Fund (DFDF) and backed by regional institutional investors, corporate venture arms and family offices. Other participating investors include MultiLane, Transmed Capital and Idriss Family Office, based in Saudi Arabia.

Fund III strengthens BY Venture Partners' focus on early-stage technology investments, particularly AI-native businesses with the potential to expand internationally from the outset.

What Startups Will BY Venture Partners Fund III Invest In?

Fund III will primarily target AI-native companies at the Pre-Seed, Seed and Series A stages, with initial investments of up to US$1 million per company.

The investment thesis centres on startups using artificial intelligence to transform enterprise workflows and develop technology platforms for global markets.

BY Venture Partners plans to build a portfolio of approximately 40 companies. It has already deployed capital into 15 investments, representing 37.5% of its planned portfolio.

The fund's investment strategy includes:

• AI-native enterprise solutions: Startups redesigning business processes and workflows using AI.
• Early-stage technology: Companies raising Pre-Seed through Series A funding.
• Global scalability: Founders building products with international markets in mind from day one.
• Cross-border expansion: Connecting international AI companies with the Middle East while helping regional founders access global markets.

Existing investments from the firm's portfolio include PQ Shield, Cosyne, Isometric, Huspy and Invisible.

Why Is BY Venture Partners Targeting AI-Native Startups?

BY Venture Partners is investing against a backdrop of growing AI adoption across the Gulf Cooperation Council (GCC).

A November 2025 McKinsey survey found that 84% of organisations in the GCC used AI in at least one business function, up from 62% in 2023. This represents a 22-percentage-point increase in adoption over two years.

For BY Venture Partners, this growing adoption creates opportunities for AI-native companies to develop solutions for businesses increasingly integrating artificial intelligence into their operations.

The firm's investment strategy also extends beyond the Middle East. It operates across more than 16 international markets, with approximately two-thirds of its capital deployed outside MENA, particularly in North America and Europe.

This global investment model allows the firm to connect international founders with the Middle Eastern technology ecosystem while supporting regional startups seeking international growth.

Ghaith Yafi, Founding Partner at BY Venture Partners, said Fund III is designed to back AI-native companies with global ambitions and attract innovative AI businesses to the Middle East.

Who Is Backing BY Venture Partners Fund III?

The Dubai Future District Fund is the anchor investor in Fund III, reinforcing its strategy of connecting Dubai's technology ecosystem with international capital and innovation.

Other investors include:

Investor	Role or relevance
Dubai Future District Fund (DFDF)	Anchor investor
MultiLane	Regional technology and high-speed data infrastructure company
Transmed Capital	Participating investor
Idriss Family Office	Saudi-based family office

Nader Albastaki, Managing Director of DFDF, said the investment reflects BY Venture Partners' ability to connect global AI-native companies with Dubai while helping founders from the region expand internationally.

He also highlighted the firm's entrepreneurial experience, noting that its partners have built and exited companies and managed investments through a full market cycle.

MultiLane Founder and CEO Fadi Daou said his company's investment reflects its confidence in BY Venture Partners' vision and its commitment to supporting emerging AI-first startups.

How Is BY Venture Partners Supporting Lebanon's Startup Ecosystem?

Beyond its investment activities, BY Venture Partners is expanding its role in regional ecosystem development through the Lebanese Angel Investor Network (LAIN).

The firm secured an MITAI-backed mandate to manage and operate LAIN, which connects international diaspora capital with early-stage Lebanese founders.

The initiative aims to create a structured pipeline for startup financing while developing the next generation of angel investors in Lebanon.

BY Venture Partners has also committed to reinvesting 50% of its carried interest directly into rebuilding the Lebanese startup ecosystem. This links the firm's investment performance to its longer-term commitment to supporting entrepreneurship in the country.

What Is BY Venture Partners' Track Record in Early-Stage Investing?

BY Venture Partners differentiates itself through an operator-led investment model. All four partners—Ghaith Yafi, Abdallah Yafi, Rami Jisr and Sohrab Jahanbani—are repeat entrepreneurs who built and exited businesses before becoming investors.

The firm reports a Founder Net Promoter Score (NPS) of 87, reflecting feedback from founders on their experience working with the investment team.

Its track record also spans multiple market cycles, including Lebanon's financial collapse, during which Fund I had significant exposure to the country's market.

According to the firm:

• Fund I remains on course to return a strong multiple to investors.
• Fund II continues to perform strongly relative to other funds from the same vintage.
• Fund I and Fund II have collectively produced four unicorns, with two attributed to each fund.
• The firm has returned capital to its limited partners (LPs).

The firm did not disclose the names or valuations of the four unicorns, the funds' specific return multiples or the amount of capital distributed to LPs.

What Does Fund III Mean for BY Venture Partners' Global Expansion Strategy?

With US$60 million in new capital and total AUM exceeding US$200 million, BY Venture Partners is expanding its capacity to back early-stage technology companies across international markets.

Fund III combines an AI-first investment thesis with a cross-border strategy: bringing global AI companies into the Middle East while helping regional founders reach international markets.

Its planned 40-company portfolio, with 15 investments already deployed, provides an early indication of how the firm intends to allocate the new fund.

As AI adoption continues to expand across the GCC and other markets, BY Venture Partners is positioning Fund III to support founders building technology platforms for global enterprise demand.