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Is Dubai The Next Big Hub for Tech Startups?

Tech startup hub

How is Dubai emerging as a hub for tech companies?

Dubai is witnessing a flourish of a different kind. Many tech startups are now considering Dubai as their startup address. The type of rush it is seeing almost puts it at par with Singapore, London, or New York. It may take some time to match these three cities, but it is encouraging that Dubai has started to flourish in the technology and innovation space.

From a fishing village to one of the world’s most innovative cities

Back in the 1990s, not many people knew about this city. It was another fishing and pearl-diving village located in a vast desert. Thirty years later, there is no stopping this city from becoming one of the most innovative cities in the world. It has literally risen from the sand to stand tall with the other smart global cities.

A vision for the future

There are many pros associated with Dubai being the first choice for founders. Its hi-tech infrastructure, two billion plus people residing in a radius of about a four-hour flight, gives the destination all reasons to thrive as a startup ecosystem. To top it, there is tremendous encouragement from government and semi-government facilities to Dubai’s growth as a hub for tech startups.

Four sectors receiving big-time support include health, infrastructure, transportation, education, and renewable energy. Decreasing the cost of technology and the abundance of corporate investors perpetually on the lookout for better investment avenues also contribute towards this trend.

Many venture and angel capital firms that were otherwise investing in real-estate, the traditional lucrative opportunity, are now turning to tech startups. Additionally, what works in favor of Dubai is its innovation spirit – its technological advancement compared to other countries in the region. In a way, Dubai has grown to be the financial capital of the MENA region that suits the tech startup ecosystem.

A case in point is AstroLabs, which is part of the Google for Entrepreneurs partner network. The collaboration is more than five years old and is focused primarily on mentoring local entrepreneurial ventures. Plus, AstroLabs’ partnership with Dubai Multi Commodities Centre assists startups in setting their business fast.

Similarly, there are platforms like Eureeca and Magnitt, crowdfunding platforms that help connect investors with startups. Most of the tech startups are expat-driven, as the demographics of the rising population show. In the early 2000s, Dubai had a population of less than a million. In 2015, it crossed 9 million, with more than 80% belonging to the expat community. Women’s participation has risen, as statistics indicate in tech startups in the region.

Reasons behind Dubai’s growth as a tech startup destination

  1. Government backing

It is essential that the government offers a viable ecosystem to attract startups for any country or state. The Dubai government has gone all the way out to provide the same. For example, the Dubai Chamber of Commerce and Industry started its first-ever Dubai Technology Tour for India called the Dubai Startup Hub last year. Interestingly, the startup community comprises about 30% Indians. A virtual trade mission offered a platform for fifteen healthcare and FinTech Indian startups to showcase their innovative business concepts. The Dubai Startup Hub (India) boosted collaboration between India and UAE, especially in the healthcare and FinTech sectors. Though this was the first virtual Roadshow, the physical Roadshow was organized in New Delhi and Bangalore in 2019.

Two Indian startup companies were chosen and awarded office space at the Dubai Technology Entrepreneur Campus (Dtec) during this Roadshow. This sort of dedicated endeavor reflects Dubai’s rising interest in new collaborations with other nations to encourage innovation and growth.

The Dubai Startup Hub has been doing exceedingly well in offering a collaborative ecosystem. In 2020, the results were excellent, with almost 2,100 entrepreneurs benefiting from the programs and 48 virtual events being organized. The first webinar of their Scaleup Dubai Program Q3-2021, which focused on the Dubai market, was just completed.

Another fascinating aspect was the appointment of the Minister of Artificial Intelligence in Dubai. The Ministry will be responsible for a series of AI-led innovations and solutions implemented in government offices to offer Dubai residents an enhanced lifestyle experience.

Another feather in the crown is the cultural visa, which is the first-of-its-kind long-term visa available for creators to showcase their artistic abilities and creative approaches.

Dubai Big Hub for Tech Startups
  1. A feasible and flexible Tech ecosystem

With government backing in place, Dubai has built a practical Tech environment in the past few years. Co-working and collaborative spaces, incubators, accelerators, and networking events with state-of-the-art facilities have developed all across the place. Facilities like 24×7 high-speed Wi-Fi, private offices, fixed desks, meeting rooms, visa services, printing, fax, shredding services, fixed desk, and more are common in these spaces.

Further, at Dtec, for example, startups get to choose between Flexi desk and fixed desk packages. The former includes Wi-Fi, round-the-clock keycard access, securable lockers, meeting spaces, event management services, trade licenses, visas, etc. Fixed desk packages comprise all these benefits plus a landline connection, lockable storage, reserved desk space, etc. The famed Dubai Technology Entrepreneur Campus also offers a private office package with all these benefits and a private office.

It is not surprising that in 2019, $704 million was invested in startups in the region, and in 2020, the figures crossed the 1 billion mark.

  1. Accelerator and incubator programs

A key feature of Dubai’s evolvement as a hub for tech startups has been its accelerator programs. Accelerators help offer startups a viable platform for learning and growing. They assist new companies in their innovative ventures in the short-term, giving them a head-start, supporting through seed investment boosting a business’ growth.

For example, Dtec offers two choices to entrepreneurs – Intelak incubator and Startupbootcamp that supports the Dubai Smart City Accelerator. A network of mentors provides comprehensive support for startups to pitch their business ideas to attract potential investors.

During the virtual roundtable meetings of the Dubai Startup Hub, positive trends about accelerators and incubators were noted. As more and more startups look towards Dubai, additional funding and investment opportunities have also grown in the past few years.

  1. Dubai’s lifestyle

Another reason for Dubai’s transitional growth as a tech startup hub is its progressive lifestyle to its residents. Startups require human resources, and most of it comes from the expat population. Foreigners find residing in Dubai lucrative for various reasons. For example, Dubai is largely tax-free.

From engineering marvels like the Burj Khalifa to the Museum of the Future, new office spaces to sustainable projects, the tech scene has ample scope to develop further in Dubai. The setting up of the MBR Space Centre to the widespread use of robots and AI in hospitals, metros, increased use of blockchain technology, etc., are all positive yardsticks. All indicate a progressive hi-tech environment. And, not to forget, the growth in the architectural landscape by leaps and bounds has also contributed to Dubai’s steadfast bloom as a tech hub.

Bottom Line

Dubai has it all when it comes to offering an amicable ecosystem for startups to set their foot on. With a focused and concerted drive, the emirate truly has the potential to become the next giant tech hotspot of the world.