Strataphy secures $6 million for AI cooling technology
Subsurface cooling platform targets hyperscale data centres
#SaudiArabia #funding - Al Khobar-based deep-tech company Strataphy has raised $6 million in seed funding led by Saudi venture capital firm Outliers Venture Capital and UAE investment firm Shorooq, with participation from regional investor PlusVC. The company develops subsurface-powered cooling infrastructure for AI data centres, industrial facilities and giga-projects using its proprietary PrimeLoop technology, which leverages deep thermal energy to reduce power consumption. Strataphy will deploy the funding to advance its technology platform, expand its engineering and operations teams, and scale deployments across MENA, targeting a regional cooling market valued at over $120 billion annually, including $13 billion in Saudi Arabia.
SO WHAT? - Cooling infrastructure has emerged as a critical bottleneck for AI and hyperscale expansion, particularly in hot-climate regions where cooling consumes nearly 50 per cent of total electricity use. The GCC has become a desirable location for AI data centres that require capital, available real estate and cheap energy. However, the abundance of energy from oil-rich Gulf states does not negate the challenge of cooling hyperscale data centres. Strataphy’s subsurface approach could address a fundamental constraint on regional data centre growth whilst supporting Saudi Arabia’s ambitions to become a global AI hub.
Here are some key points about this fund raise:
Strataphy has raised $6 million in seed funding led by Outliers VC and Shorooq with participation from PlusVC, marking one of the region’s largest early-stage investments in cooling infrastructure technology for AI and industrial applications.
The Al-Khobar-based company’s proprietary PrimeLoop subsurface technology uses deep, stable thermal energy to cool infrastructure with lower power requirements. The technology can enable electricity cost reductions of up to 49 per cent compared to conventional cooling systems in commercial deployments.
The company operates a Cooling-as-a-Service model that shifts geothermal cooling from capital expenditure to operating cost, allowing organisations to deploy advanced systems with minimal upfront investment whilst reducing long-term energy consumption.
Strataphy was co-founded by Dr Ammar Alali, who holds a PhD in Earth Sciences and Energy Systems from MIT, and Ahmed Alhani, with both founders bringing over 15 years of experience from Saudi Aramco in subsurface exploration and geothermal systems.
Strataphy’s client base includes Saudi giga-project NEOM, King Abdullah Economic City, Saudi Arabia district cooling provider Saudi Tabreed, UAE energy company Enersol, Abu Dhabi drilling contractor ADNOC Drilling, and Abu Dhabi holding company Alpha Dhabi Holdings.
The Middle East cooling market is valued at over $120 billion annually, with Saudi Arabia representing $13 billion of that total, driven by extreme temperatures and rapid infrastructure expansion across data centres and industrial facilities.
ZOOM OUT - Saudi Arabia is investing heavily in building out AI compute for local and global consumption, attracting significant foreign direct investment (FDI) from hyperscalers and aims to become a significant exporter of AI cloud services, leveraging the country’s unique combination of access to capital, energy and real estate. During the last few weeks Saudi AI infrastructure initiatives and investments have been announced with AMD, Amazon Web Services (AWS), Cisco, DataVolt, Magna AI, NVIDIA, Qualcomm and xAI.
[Written and edited with the assistance of AI]
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