212 Updates #187 | May 11th
Muscat, Oman | London | Investments
Good morning from Muscat, Oman. I arrived early this morning on Turkish Airlines direct flight from Istanbul. Thanks to Turkish Airlines, almost all my flights over the last 16 years in Istanbul have been direct flights. Apparently, THY now flies to 287 destinations with roughly 1,700–2,000 daily flights, including 14 cities in the US. (For the record, this is not a sponsored post. 🙂 Although, I wouldn’t exactly object if THY decided to change that.)
Most of our team are on the road this week. While I'm here in Muscat, Ali and Ozge are in London for various meetings and London VC Week events. Please feel free to drop them a note for coffee. I’ll also be back in London next week for board meetings. Can will be in Ankara, and the Simya team will be in İzmir.
Even in an age of endless digital connectivity, venture capital remains very much a people business. Being present at events, staying close to founders, and having face-to-face conversations remain extremely important in our business.
We cannot simply sit in our offices and wait for founders to reach out to us. Events, demo days, and conferences help us better understand markets, identify changing dynamics early, and build stronger long-term relationships with founders and ecosystem players.
On the investment front, Simya completed its investment in Hardal last week. This marks Simya Fund II’s fourth investment and the 16th investment overall. Hardal provides a data infrastructure layer that enables companies to collect data from websites, mobile applications, CRM systems, and marketing tools through their own servers. The platform standardizes and validates this data, then distributes it securely and consistently across systems ranging from analytics tools to advertising platforms. A warm welcome to the Hardal team. You can read Selma’s post here…
Speaking of investments, Regional Fund also completed another investment last week and are currently waiting for the company to make its announcement first.
I’ll continue responding to some of the questions I’ve received, please keep them coming.
Q: With recent “native AI” company valuations, initial rounds are getting higher and higher. How do higher initial valuations or larger round sizes affect startups?
Initial rounds are definitely getting larger, in some cases reaching tens of millions, and occasionally even crossing into nine-digit territory. Valuations are also moving accordingly. As a rule of thumb, we always look at traction, previous funding history (if any), what the company achieved with earlier capital, and whether they were able to demonstrate meaningful progress. In many ways, this evaluation framework remains the same for every round.
While larger rounds and higher valuations may seem like separate topics, they actually need to be evaluated together.
In some verticals, the initial cost structure is naturally much higher or requires a longer runway before meaningful commercialization. We see this in biotech, pharmaceuticals, climate tech, fintech and now increasingly in AI. Training models, infrastructure costs, compute power, and acquiring top talent can require significant upfront capital.
However, raising a larger round also creates higher expectations. At the next financing round, companies are expected to justify not only the valuation, but also how effectively they deployed the capital and what traction they generated with it. If the progress does not match expectations, in the best-case scenario there may simply be a valuation reset.
The same applies to higher valuations. While it may initially look like everyone is making money on paper, the real test comes during the next round or at exit, whether a new investor or buyer is willing to support the same multiples.
We saw similar dynamics during the COVID era, when many companies raised large rounds at aggressive valuations. Some later struggled to raise follow-on capital, while others had to go through down rounds or pay-to-play structures, both of which can be painful for founders and existing investors.
My personal view is that with the recent AI momentum, we are starting to see some companies drift into a “fake it till you make it” mindset. In software, storytelling has always mattered. But eventually, fundamentals catch up. Sustainable businesses still need real customers, repeat usage, strong unit economics, and long-term defensibility.
At the end of the day, valuation is temporary, execution is permanent.
Last Week
Investment teams interacted with 105 companies.
Selam and Zeynep attended BSH Türkiye R&D TechPartners Day.
Ozge, Can, and Musab attended Koc University - Get Hired event.
Gizem and Caglar were at NIF Meeting.
Idil, Selma, and I were at CVC Bosphorus.
This Week and Next
I will be in Oman for meetings until Wednesday, May 13th.
Caglar will be a panelist at Aselsan Panel Session on Monday, May 11th.
Selma and Zeynep will attend Workup demo day on Monday, May 11th.
Can will host a session at METU Management Club in Ankara on Tuesday, May 12th
Ali and Ozge will be in London to attend board meetings and the following events:
Endeavor GTEN London Networking Event on Tuesday, May 12th.
The Founder Mixer on Tuesday, May 12th.
The Investor Mixer on Wednesday, May 13th.
Oxford AI Forum on Saturday, May 16th.
Can will attend YTU Startup Mockup Final Session on Thursday, May 14th.
Zeynep will be at Odak Merin Venture Days on Thursday, May 14th.
Selam will attend İzQ Accelerator Demo Day on Thursday, May 14th.
Can will be a jury at Beyond Summit on Friday, May 15th
Idil and I will attend Wired Turkiye Launch on Fridaym May 15th.
Gizem and Can will be panelist at Build Year by FounderN Event on Friday, May 15th.
Some News
DeepSeek Closes in on a $50B Valuation. Read here…
Anthropic Bets Big on Google. Read more…