BY Venture Partners closes $60 million Fund III for AI startups

Dubai-headquartered BY Venture Partners has closed its third fund, Fund III, at $60 million, taking the firm's total assets under management to more than $200 million. The Dubai Future District Fund (DFDF) is the anchor investor, joined by MultiLane, Transmed Capital, the Idriss Family Office from Saudi Arabia and other institutional and private backers.

Focus on AI-native companies

Fund III will write cheques of up to $1 million, mainly at Pre-Seed to Series A stage, into AI-native companies that rethink enterprise workflows and aim to scale globally from day one. The firm has already made 15 investments from a planned portfolio of 40, including PQ Shield, Cosyne, Isometric, Huspy and Invisible.

BY invests in more than 16 markets, and about two-thirds of its capital is deployed outside the MENA region, mainly in North America and Europe. Earlier funds backed NymCard, Toters, Huspy and Invisible. The firm cites a McKinsey GCC survey from November 2025 showing 84% of organisations used AI in at least one business function, up from 62% in 2023.

"The focus of this fund is to back AI-native companies with global ambitions," said founding partner Ghaith Yafi, adding that the firm wants to draw leading AI companies to the Middle East. DFDF Managing Director Nader Albastaki said the partnership will be measured by the flow of companies and founders between Dubai and international markets, in line with Dubai's D33 economic agenda.

Lebanon commitment

Separately, BY has won a mandate, backed by MITAI, to manage the Lebanese Angel Investor Network (LAIN), which links diaspora capital with early-stage Lebanese founders. The firm says it will reinvest 50% of its carried interest into rebuilding Lebanon's startup ecosystem.

The four founding partners, Ghaith Yafi, Abdallah Yafi, Rami Jisr and Sohrab Jahanbani, are all repeat entrepreneurs with prior exits. The firm says Fund I, heavily exposed to Lebanon during its financial collapse, is still on course to return a strong multiple, while Fund II is performing strongly for its vintage. Together the two funds have produced four unicorns and have already returned capital to investors.