How Emerging Mubadala-Backed AAF Is Winning VC Deals In Some Of The Hottest Startups
It’s been nearly a decade since Omar Darwazah and Kyle Hendrick launched AAF Management in 2017 — a venture capital firm now making headlines for its unconventional approach. Today, how emerging Mubadala-backed AAF is winning VC deals in some of the hottest startups is a case study in patience, strategy, and focus.
Image Credits:AAF Management
A Lean Strategy That Defies the Big-Fund Trend
While many VC firms race to grow massive portfolios, AAF has intentionally kept its fund sizes small — prioritizing performance and alignment over scale. The latest fund, the $55 million Axis Fund, recently closed, bringing AAF’s total assets to roughly $250 million across four funds.
Instead of chasing bigger AUM figures, the partners focus on strategic growth. “Running a $50 million fund is very different from running a $500 million fund,” said Darwazah. “We’ve seen large fund sizes disrupt GP-LP alignment — and that’s not the game we want to play.”
The Hybrid Fund Model: AAF’s Secret Weapon
What sets Mubadala-backed AAF apart is its hybrid fund model — blending direct startup investments with fund-of-funds participation. This approach gives AAF exposure to both emerging fund managers and fast-rising startups.
With the Axis Fund, AAF plans to allocate 80% of capital to startups and 20% to emerging funds, creating what the team calls a “one-stop capital formation partner” for both founders and fund managers.
So far, the Axis Fund has invested in 25 early-stage venture funds and five direct startup bets — an impressive mix that helps the firm spot breakout companies before they go mainstream.
Access to the Richest Datasets in Early-Stage Investing
According to general partner Kyle Hendrick, this dual investment strategy is more than diversification — it’s data-driven.
“We’ve found that the richest dataset of private-market companies at the earliest stages is accessed through LP checks in emerging managers,” Hendrick explained.
This gives AAF a unique window into early deal flow and innovation pipelines — a major edge in a hypercompetitive venture market where timing is everything.
From Washington to the Global Stage
Headquartered in Washington, D.C., AAF has expanded its influence across the U.S. and globally, thanks to backing from major institutional investors, including Mubadala Investment Company. The Abu Dhabi-based fund’s support has strengthened AAF’s reputation as a disciplined and globally connected player in venture capital.
As the firm continues to identify some of the hottest startups across fintech, AI, and consumer tech, its hybrid model positions it as a powerful bridge between investors and innovators.
AAF’s Focus on Emerging Managers
Another key part of how emerging Mubadala-backed AAF is winning VC deals lies in its support for new fund managers. The firm invests in emerging managers’ first or second funds (typically under $50 million), helping them scale and gain early traction.
This ecosystem approach benefits everyone involved — startups gain early capital and mentorship, while emerging fund managers get the backing and credibility needed to thrive.
A Sustainable, Long-Term VC Vision
AAF’s disciplined model challenges the status quo of hypergrowth VCs. By staying small, data-informed, and connected through both LP and direct investments, the firm has built a sustainable advantage in sourcing and scaling early-stage innovation.
As the global venture capital landscape heats up, AAF’s hybrid approach offers a roadmap for how emerging funds can stay competitive — without losing sight of alignment, performance, and integrity.
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