Dubai-Based VC Firm Wanting To Take Blockchain To the Next Level

Cypher Capital is launching a $100 million seed fund aimed at investing in digital assets including crypto currencies. Its founder, Bijan Alizadeh, also wants to invest in talent in the MENA region.

“In my mind, the United Arab Emirates (UAE) is one of the three biggest hubs when it comes to blockchain, the others being Miami and Singapore. The rules and regulations that are coming to effect by the UAE government and its leadership will essentially make the UAE the center of blockchain. There are more than 350 blockchain companies operating here and that number is growing day by day.” – Bijan Alizadeh, founder of Dubai-based venture capital (VC) firm Cypher Capital

“In a traditional VC firm, you are running a sort of high-risk, high-reward business, but once you add the element of blockchain to it, it becomes 10 times more risky and more rewarding.”

It’s impossible to write a complete story on any entrepreneur in the blockchain ecosystem. Theirs is an evolving tale that needs updating every day, just like the space they are in. 

“You need to be up-to-date, as the blockchain space is growing at lightning speed,” affirms Bijan Alizadeh, the founder of Dubai-based venture capital (VC) firm Cypher Capital, which has just announced that it’s launching a $100 million seed fund aimed at investing in digital assets including crypto currencies.

Cypher Capital, which is four months old and currently a team of 25 with seven analysts looking into more than 120 projects, has $10 million in assets under management, and in the next three years, aiming for over $1 billion before raising money from institutions.  

“We want to build a solid track-record,” says Alizadeh.

A Dubai resident for over 20 years, he “self-funded” Cypher Capital, which will invest in blockchain projects, and as he reiterates in a Zoom interview with CNBC Africa, “also invest in talent within the Middle East and North Africa (MENA) region”.     

Alizadeh has an interesting story to tell you about what stoked his interest in the blockchain space in 2014. After studying electrical engineering at the American University in Dubai, along with his business partner, Munaf Ali, he was working on real estate projects at the time, and was in the hotel sector, one day, trying to sell a unit to a customer who said he will pay in bitcoin.

“And I said ‘what coin’?” says Alizadeh.

That was the moment their life and vision changed, and they never looked back.

“At the time of this incident in 2014, bitcoin was around $270. We decided to receive that transaction in bitcoin, and after one year, bitcoin started moving up and we looked at the technology and we said this is the future. It still is. We consider 95% of our portfolio is blockchain-focused.”

In 2015, they went on to found Phoenix, in the bitcoin mining space and which is still active.

Alizadeh calls Cypher Capital “his baby”, and a most exciting space to be in.

“In a traditional VC firm, you are running a sort of high-risk, high-reward business, but once you add the element of blockchain to it, it becomes 10 times more risky and more rewarding.

“In a traditional VC, you look at 20-30 projects a year, here, you have new ideas coming in every day, and amazing talent and everything in real life that they can bring to blockchain.

“It’s a lot more work, and we need to be more focused and it’s time-consuming, but at the end of the day, we are all helping to bring the ecosystem to the next level.”

Cypher Capital’s main focus is also mentorship. So to hand-hold young startups, the company is now building a 10,000sqft digital and crypto hub at JBR in Dubai that’s set to come online shortly this year.

“A lot of startups raising money need help, and a back office. We come in, and help projects to come together, share ideas, and synergise. It will be free of charge for startups; the idea is not to make money but to give back to the community,” says Alizadeh.

After all, Dubai has made so much happen in this space.

“In my mind, the United Arab Emirates (UAE) is one of the three biggest hubs when it comes to blockchain, the others being Miami and Singapore. The rules and regulations that are coming to effect by the UAE government and its leadership will essentially make the UAE the center of blockchain. There are more than 350 blockchain companies operating here and that number is growing day by day.”

He is also planning to take the hub to Singapore, Miami and hopefully Africa in the future, a continent he is watching closely.

“In Africa, a lot of countries have problems with payment solutions, especially in the remote areas, so blockchain can help be a solution for a lot of challenges. Africa is an emerging market and once the opportunity arises, we will jump in. We are constantly monitoring which jurisdiction to set up in.”

The company is also actively looking at projects in the GameFi, DeFi and Metaverse space.

“We have made over 12 investments in the last three months, but the most notable that will change the game will be Cross The Ages – I really believe that this is the game that you really want to play plus you make money on it. I am really trying to bring users to play this game because once you do, your whole view of GameFi will change,” Alizadeh promises.

For now, to make all this happen, the 35-year-old works long hours in five different jurisdictions and time zones.

“I call myself an old soul,” he laughs. “When you work 18-19 hours a day, 35 is an actual 50.”

Any advice for young people who have to work multiple time zones in a distributed, remote working world?

“My advice is that nothing is easy. You need to hustle. You have to dedicate your time and energy, but at the same time, take care of yourself. You may have the talent and the brains but work really hard to achieve!”

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