A country that leads innovation and invests in startups and innovative ideas
Dubai is home to many innovative companies and invests heavily in startups, scoring excellent scores on the global new business investment rankings. The city is home to Uber-owned Telegram and Careem and a vast and ever-growing amount of new funded projects.
Creating a startup culture brings a great return to the city regarding job opportunities, a healthier economy, and an ecosystem that drives change.
Data-driven environment
Dubai is included in the 35 cities of the world for VC funding, obtaining a 63.11 out of 100 VC funding rating in startups, as announced by Finom’s Innovation in Business Index and taken up by The National News magazine. Fintech is the leading sector for the number of transactions and the third for investments.
The emirate is also among the top places in the World Bank’s Doing Business ranking, recording an overall score of 80.9, which adds up the scores on several metrics such as new business creation, financing, paying taxes, protecting smaller investors, and many more.
There are 229 venture capital funds in Dubai, as reported by the Tracxn website, a testimony to the fact that competition is fair and involves the participation of larger or smaller funds, and can invest in new projects.
As reported by Magnitt in the UAE Q1 2021 Business Investment Report, Dubai has seen a decline in investments during the pandemic period but also saw a strong recovery with 72% investment gains from the fourth quarter of 2020. Another is that 40% of active investors are based in the UAE, while US investors are given 18%. This number indicates the strong interest in investment by foreigners in the Emirates.
The Dubai Startup Outlook 2021 report explores the themes of innovation and investment are addressed by analyzing the UAE Economy and Competitive Advantage for SMEs and startups and entrepreneurship ecosystem in Dubai.
Learn from others and improve your approach
Luca Barbi, COO of STV, the largest VC fund in the Middle East, talked about some elements and lessons to be learned from Dubai.
- Growth is not linear but is exponential. In the Middle East, the total distributed capital in 2019 was 800 million dollars invested in technological initiatives; in 2020, it was 1 billion; in 2021, it will be 2 billion. The number of companies is growing compared to the previous year, and the Emirates had investments from significant global funds. The scene is crowded with investors, entrepreneurs, and even the government struggling to invest and earn local businesses and IPOs.
- Make investments in companies led by young talents. There is a lot of money, but there is often a shortage of new talent. Some entrepreneurs have the will, the experience, and the ability to create new initiatives, but few young people manage to do so.
- Create government-sponsored acceleration programs. It helps enable new entrepreneurs or open up even more by creating a network of international talents, making them known, gaining trust, and networking. In the Middle East, this approach is successful; despite being a land where there was no technology experience, this problem of talent scarcity is well known. Communication helps people understand that it is possible to be successful entrepreneurs in technology or to have experience and knowledge.
