KSA-Based Strataphy Bags US$6 Million To Expand Its Geothermal Cooling Platform Across The MENA

Saudi Arabia-headquartered Strataphy has raised US$6 million in a seed funding round to accelerate the rollout of its geothermal-based cooling platform.

The investment round was led by Riyadh-based Outliers VC, an early-stage deeptech-focused venture firm, with participation from Abu Dhabi–based multi-dimensional investment firm Shorooq, as well as Dubai-based Plus VC, a founder-centric seed-stage fund. 

Founded by Ammar Alali and Ahmed Alhani in KSA in 2025, Strataphy develops geothermal-based cooling systems designed to reduce electricity use for large industrial and artificial intelligence (AI) infrastructure projects. In an interview with Inc. Arabia, Alali, co-founder and CEO of Strataphy, shared the story of how the company came into being. “Growing up in the MENA region, I lived with the fact that cooling is not optional—it is essential to life, industry, and now the AI infrastructure shaping our future," Alali said. "Then, during my 15 years in the energy sector, including my years at Saudi Aramco and later building new ventures in geothermal and subsurface technologies, I saw the same pattern everywhere: cooling demand was rising exponentially, but the tools to meet it were standing still."

This insight would shape his Alali's time at the Massachusetts Institute of Technology (MIT), where, while doing his PhD, he first came to think of Strataphy. "MIT has a way of forcing you to rethink systems from first principles, and that environment pushed me to imagine how subsurface energy could be completely redesigned rather than incrementally improved," he recalled. "That mindset stayed with me throughout my career. I became committed to finding the most optimized, efficient, and scalable way to cool large, concentrated loads—at lower cost, with higher reliability, and with minimal environmental impact.”

This line of thinking went on to open the door to Alali's interpretation of geothermal cooling that had little in common with the conventional systems built for heating in colder climates. “Conventional geothermal systems, built for heating in Europe, Japan, and North America, were never engineered for cooling-dominant regions like ours," Alali explained. "The physics, scale, and operating conditions simply didn’t align. This gap became the spark for Strataphy. We asked: what if geothermal could be reimagined from the ground up for hot climates? What if subsurface systems could operate in cooling-only mode, all year round, for data centers, industrial facilities, and mega projects?”

That shift in perspective led Alali to develop PrimeLoop, a subsurface technology that leverages deep, stable thermal energy to cool infrastructure with drastically lower power requirements, which, in turn, became the foundation of Strataphy. Strataphy has successfully demonstrated PrimeLoop in commercial settings and documented electricity cost reductions of up to 49 percent compared to conventional cooling systems, proving its ability to deliver efficient, reliable, and scalable cooling in some of the world’s hottest environments.

The investment in Strataphy thus comes as cooling emerges as one of the most pressing infrastructure challenges in hot-climate regions, where it can consume nearly half of total electricity use. The Middle East represents a market valued at more than $120 billion annually, including $13 billion in Saudi Arabia alone, underscoring the scale of demand Strataphy is targeting. 

Strataphy’s clients and partners include NEOM, King Abdullah Economic City, Saudi Tabreed, Enersol, ADNOC Drilling, and Alpha Dhabi Holdings, among others, across the region. Strataphy also makes use of a cooling-as-a-service model, which shifts geothermal cooling from a capital expense (capex) to a predictable operating cost, allowing organizations to deploy advanced systems with minimal upfront investment, while also reducing long-term energy consumption and improving reliability.

Deployments with major regional clients have also informed the Strataphy platform’s evolution. “While the specifics are confidential, these partnerships have given us a clear view of what large-scale operators truly need from next-generation cooling systems,” Alali shared. “At this scale, three things become immediately evident. Economics improve dramatically—large operators unlock deeper efficiencies and stronger unit economics for PrimeLoop. Furthermore, system limits can be tested and expanded—these deployments push our technology into real, demanding operational environments, and help refine performance at scale. They also benefit from reduced energy-infrastructure capex—because PrimeLoop cuts cooling electricity demand by more than 40 percent, it lowers the required electrical capacity for entire developments. This means smaller substations, reduced grid upgrades, and materially lower upfront infrastructure costs. These insights have shaped how we design, size, and deploy PrimeLoop for the next generation of giga-projects, industrial zones, and AI infrastructure.”

The new investment in Strataphy is thus set to help the company advance its technology stack, expand its full-service operating model, and grow its engineering and operations teams as it scales deployments across giga-projects, industrial zones, and hyperscale data centers in the MENA and other high-temperature markets. According to Alali, it is the scale of the problem that Strataphy is attempting to solve that attracted the backers it secured for this funding round.

“Our investors backed Strataphy because cooling has become one of the biggest constraints on AI and industrial growth, and our subsurface platform solves that challenge at its foundation,” Alali said. “They saw a team tackling a problem that few have dared to approach in one of the hottest regions on earth. Outliers resonated with this immediately. Their thesis is centered on backing literal outliers—founders solving hard, system-level problems—and doing so from a Saudi base. Their conviction in bold, technical ventures aligns directly with the scale of what we are building. Shorooq, through Presight Capital and their AI-focused investment strategy, brings a sharp understanding of how cooling underpins the next decade of AI and digital infrastructure. Their regional strength and global reach make them a natural partner as we expand beyond the MENA. Plus VC has supported us from the early days and continues to provide fast, pragmatic support as we scale. Together, they provide the conviction, strategic alignment, and reach we need to grow Strataphy across the region and globally.”

Looking to the future, Alali expects cooling to shape the global trajectory of AI infrastructure. “Globally, data-center cooling demand is rising sharply as total power capacity moves toward more than 80 gigawatts (GW) by the end of the decade, with annual electricity consumption expected to exceed 1,000–1,400 terawatt-hour (TWh),” he said. “According to the Goldman Sachs analysis highlighted by Silicon Valley-based A16Z, cooling has now become the single largest capex line item in next-generation data centers, exceeding servers, graphics processing units (GPUs), and power equipment. As these loads grow, operators can no longer rely on heavy upfront capex, long build times, or oversized electrical infrastructure.” 

Alali highlights here that Strataphy’s cooling-as-a-service model can remove such a burden by shifting cooling from a massive capital requirement into a predictable subscription, allowing hyperscalers, giga-projects, and industrial operators to scale at the speed AI now demands. “In parallel, technology is evolving toward subsurface-powered systems like PrimeLoop, engineered specifically for large, concentrated, year-round cooling needs in hot regions, cutting electricity use by more than 40 percent, and reducing the need for large substations and grid capacity,” he added. “Over the coming years, cooling-as-a-service will merge this subsurface capacity with smart monitoring and modular deployment to create a scalable, efficient, infrastructure-light cooling backbone for the next wave of AI and industrial growth.”

Pictured in the lead image are Strataphy co-founders Ahmed Alhani (L) and Ammar Alali (R). Image courtesy Strataphy.