Alem Capital's $25M Anchor Boosts Central Asia Tech Funding

Alem Capital Management's participation in the final closing of Sturgeon Capital's Emerging Opportunities II fund, which raised $25 million in total, represents a move aimed squarely at closing Kazakhstan's Series-A funding gap. As the first publicly disclosed local fund-of-funds to back a regional venture vehicle, Alem's investment directs capital toward early-stage technology companies across Central Asia and the Caucasus. This initiative has also attracted capital from the International Finance Corporation and Japan's SBI Group, signaling growing confidence in the region's burgeoning tech ecosystem.

What is significant about Alem Capital anchoring Sturgeon Capital's Emerging Opportunities II fund?

Alem Capital Management's participation in Sturgeon Capital's Emerging Opportunities II fund, which raised $25 million in total, is a landmark event. It represents the first disclosed backing of a regional VC vehicle by a local fund-of-funds, directly addressing Kazakhstan's Series-A funding gap and signaling robust support for tech startups in Central Asia and the Caucasus.

Why the anchor matters

This investment is significant because it provides substantial capital in a market where follow-on funding is scarce. By backing a regional fund, Alem Capital validates the local ecosystem for international investors and creates a clearer path for early-stage companies to secure Series A and later-stage financing.

The $25 million fund close in a region where domestic VC funds have limited capital represents a strong signal to international LPs and founders alike.

The Sturgeon Emerging Opportunities II (SEO II) fund targets larger check sizes and higher ownership stakes compared to typical market conditions in Kazakhstan, with a stage focus spanning pre-Seed to pre-Series A compared to the market's seed-heavy approach.

Who else is in the cap-table

The fund's capitalization table includes other key investors alongside Alem Capital:

• International Finance Corporation - significant commitment
• SBI Group (Japan) - strategic fintech partnership for Uzbekistan
• Qazaqstan Investment Corporation - substantial participation
• BCC Invest & family offices - second close members

The IFC's commitment, made through its Startup Catalyst programme, adds a layer of institutional governance that enhances the fund's appeal to a broader range of international limited partners.

Pipeline in focus - Kazakh and Uzbek early bets

Sturgeon has already deployed capital into several promising startups. Its Kazakh portfolio includes Farel (AI-driven enterprise automation) and Surfaice Pro (industrial SaaS). In Uzbekistan, investments have been made in Oasis Credit, Shikho, and Smartlane. Recent investments include *Geomotive, an AI analytics platform for advertising and retail, expanding the fund's disclosed Central Asian portfolio.

The wider capital-access picture

Although venture capital deployment in Kazakhstan has grown significantly, a significant access-to-capital problem persists for founders seeking post-seed funding.

A significant portion of capital parked in local funds had not been deployed by startups, illustrating both cautious deployment and a systemic shortage of follow-on capital.

The prevalence of SAFE notes in many early deals further masks the difficulty founders face when raising larger, priced rounds. While a planned $1 billion government fund-of-funds is intended to address this gap, Alem Capital's investment demonstrates that the private sector is proactively moving to solve the problem.

Sector concentration - AI leads, others queue

Investment trends in Kazakhstan show a strong concentration in Artificial Intelligence. Venture funding for AI projects in Kazakhstan rose from about $14 million to $73 million between 2023 and 2025, accounting for more than half of all local venture capital. Following AI are fintech, marketplaces, and health-tech. In contrast, sectors like agritech and enterprise automation, which are core themes for the SEO II fund, currently receive significantly less investment.

What founders can expect next

For founders, Alem Capital's participation in the Sturgeon fund provides several key advantages:

• Local currency knowledge and tax residency support
• Potential co-investment from sovereign-linked QIC later down the line
• Access to Astana Hub incentives for resident startups

While the fund's mandate also covers the Caucasus, no investments in Azerbaijan, Georgia, or Armenia have been publicly announced yet. However, discussions are reportedly in progress with companies in the B2B software and fintech sectors.