AI Infrastructure Startup MidLyr Concludes US$2.5 Million Pre-Seed Round

Los Angeles-based artificial intelligence (AI) infrastructure startup MidLyr has raised US$2.5 million in pre-seed funding led by Silicon Badia, with participation from US-based early-stage venture capital firm Wedbush Ventures, San Francisco–based Hustle Fund, New York–based Digital Currency Group (DCG), and New York–based Story Ventures, which invests in data-driven startups. 

Founded by Wael Elsahhar and Ruochen Ren in the US in 2025, MidLyr, which also has an engineering office in Cairo, is developing an AI-driven foundation for how banks and fintechs operate—one that is durable, compliant, and adaptive. The platform aligns AI agents directly with regulations, policies, and operational data to create bank-grade automation that institutions can trust. 

Elsahhar, who grew up in Egypt before moving to the US for business school, built his career at companies like McKinsey, Amazon, and Imprint before partnering with Ren to launch MidLyr. “I saw firsthand the complexity of building the internal operations of a bank,” he said in an interview with Inc. Arabia. “We were hiring too many people doing things like compliance and risk management in very manual and traditional ways. With the rise of generative AI around 2022, I started getting obsessed with how you can rebuild a bank from the inside out with these tools.” 

That experience, he explained, revealed a common pain point across the sector. “Talking to others in the industry—even ones in innovative startups—it was clear that everyone suffered the same issues,” Elsahhar said. “Banks are defined by processes and heavy regulatory environments. That’s needed because banks—and money—are important to people and to governments. But it doesn’t have to mean that banks should be slow and sclerotic.” Keeping this background in mind, MidLyr’s mission is thus to, as Elsahhar put it, “to make banks nimbler, faster, and more responsive to their customers.” 

The company officially launched in late October 2025, introducing its platform, which enables banks and fintechs to automate operations within compliant, AI-driven frameworks. “We raised our pre-seed round with Silicon Badia leading over the summer, and focused on building the product, getting our first few design partners, and now releasing our first set of products—all in a short 4.5 months,” Elsahhar shared. Through MidLyr’s application programing interface (API)-level integration, banks can observe everything happening across their operations—such as call center interactions and loan underwriting—and assess risks based on government regulation and internal policy, both mapped within what Elsahhar calls a “regulatory graph.” “Once you have that foundation, we allow you to deploy any number of AI agents to automate many of the repeatable tasks you have to deal with, knowing that these agents will not go ‘off the rails,’” he added. 

Building that kind of infrastructure requires precision and trust—especially in a heavily regulated industry—which makes ensuring regulator-friendly automation, Elsahhar said, central to the company’s vision. “Today, people in most organizations are using all sorts of AI tools without understanding that the answers or actions they are getting out of it might not be rooted in the correct, latest, or the bank’s own interpretation of regulation,” Elsahhar said. “MidLyr allows you to define those guardrails, ensure that the agents are performing within them, and change these whenever the business needs change.” 

To achieve this, the company has built extensive and continuously updated knowledge bases of relevant regulations, supported by human experts who evaluate how AI agents interpret and apply those rules. “It is a big operation that involves a lot of domain knowledge, as well as data science and machine learning work,” he said. “But ultimately we think this doesn’t just create value for our customers, but also for regulators and the public they serve.” 

According to Elsahhar, most current AI integrations in financial institutions only scratch the surface. “We are very early in the wave of AI adoption," he said. "Most of the AI applications today are bringing in relatively basic knowledge management and search capability into organizations. That’s good. But not enough. If you’re the chief compliance officer of a bank, you want your team to have the right context and understanding of risks to make the right decisions. MidLyr is the infrastructure layer that allows your agents—human and AI—to operate within these firm guardrails.”

And while Elsahhar admits that introducing new infrastructure to risk-averse banks is a challenge, he has been encouraged by the industry’s openness. “It is a long journey, but we have been constantly surprised by the banks’ willingness to experiment,” he said. “People there are very smart, and they understand the limitations of their current tools. We see our goal as educating on what’s possible, listening intently to what operators are experiencing, and iterating quickly to satisfy their needs.” 

That operator-first mindset, he added, is informed by his and Ren’s previous roles in building and managing regulated systems. “We start with appreciation and respect of what bank operators are dealing with. It is a daunting endeavor,” Elsahhar said. “They are skeptical of people making big, magical claims about how this or that tool will save them 90 percent of the effort. We are able to go in and say, ‘We have lived through this like you, and here is what we learnt.’” 

As MidLyr expands its partnerships and product capabilities, the company is also looking to the MENA region as a strategic base for its next phase of growth, building tech hubs across the region to serve the US market. For Elsahhar, building from the Middle East isn’t just a geographic decision—it’s a bridge between two financial worlds that learn from each other.

"The depth of talent in the region is mind-blowing," Elsahhar said. "It is a story we have seen across financial services and especially payments. Emerging markets like the Middle East tend to move faster and build innovative solutions ahead of more established markets. Companies like Tabby or Fawry are great examples. That means that you have a deep talent pool that understands financial services, and is not afraid of taking on and reinventing whole sectors of the economy because they have done it before. We want to capitalize on that both to help us build MidLyr, but also to give us the nuanced understanding to serve banks and governments there." 

Pictured in the lead image is MidLyr co-founder Wael Elsahhar. Image courtesy MidLyr.