Government initiatives and supportive ecosystem: How Dubai is giving tech startups a leg up to become global players
As Dubai fulfils ambitious plans to become a global leader in technology and the digital economy, support for SMEs across all sectors has been impressive. In keeping with the government’s long-established plans to make SMEs the backbone of a diversified economy in the UAE, the 500,000 or so business entities that qualify as SMEs now employ more than 40% of the country’s workforce. With concrete plans to raise the number of SMEs to around 1 million by 2030, they already account for around two-thirds of the nation’s non-oil GDP.
Not surprisingly for a country with ambitions to become a leader in the digital economy, the technology sector features heavily in the SME ecosystem.
So, what’s available in the broader SME and tech-SME ecosystem, and how are the government’s targeted initiatives helping fast-scaling tech firms go truly global?
Structural and strategic government initiatives: the power behind tech SME growth
The biggest influence on all startups’ ability to break into global markets is the foresight and action taken by Dubai’s government and its agencies. Structural and operational help and support are in plentiful supply, but while those initiatives are just too many to mention here, the structural groundwork and operational action at the coal face say two important things to tech startups and investors: this is where we’re going, and this is how we’re going to help you get there.
Dubai’s recent budget underlines this statement of intent: 6% of the government’s total national income will go to support new business innovation, further strengthening Dubai’s Vision 2030, which aims to foster growth and tech innovation through entrepreneurship in AI, digital and tech sectors.
On the structural front, Dubai Vision 2030 and Economic Agenda D33 clearly state where the government wants to take Dubai’s economy. Economic Agenda D33 aims, among other things, to encourage rapid growth of SMEs by singling out 400 promising startups and help them achieve global expansion. As an integral part of Economic Agenda D33, ‘Sandbox Dubai’ allows for the testing and marketing of new technologies to help incubate innovative tech startups. In addition, the government has instigated a program to assist with the growth of 30 startups in new sectors to become global unicorns – defined as privately owned companies with a valuation of over USD 1 billion – by 2031.
It’s initiatives like this that are likely to deliver on Economic Agenda D33’s plan to double the size of Dubai’s entire economy by 2033.
Operational government initiatives
Ignyte: a global epicentre for entrepreneurship
The DIFC-curated digital platform will help startups grow and expand globally from Dubai. DIFC is the leading financial centre in the Middle East, Africa, and South Asia (MEASA) region, and it will make Ignyte a key tool in the Dubai Digital Economy Strategy. As a sign of its ambitions, it expects to lend a crucial helping hand to over 100,000 startups, and as its governor notes, “DIFC is reinforcing Dubai’s position as a leading hub for entrepreneurship and technological advancement.”
And while undoubtedly helping SMEs in other sectors, Ignyte will supercharge growth in the tech space, empowering tech startups to scale quickly and access international markets faster than otherwise possible. One of the ways it will foster further growth in the tech ecosystem is by connecting founders with a global network of investors, mentors, corporate organisations, and local government entities. In short, it will create a comprehensive growth ecosystem. By offering startups access to 5,000 venture capitalists and angel investors, 5,000 vetted mentors and experts, and more than 500 corporate and government partners, DIFC “will collectively help start-ups save more than USD $100 million”, according to DIFC’s Governor.
International representative offices: growing the tech SME ecosystem
Dubai International Chamber, funded by Dubai’s government, doubled its representative international offices in 2023, from 15 to 31. As one of three entities under the ‘Dubai Chambers’ umbrella alongside Dubai Chamber of Digital Economy, it exists to help SMEs access global markets, and as the president and CEO of Dubai Chambers underlines, “the growth in SMEs from across the globe moving to Dubai sits alongside a goal from the emirate’s leadership to see home-grown small businesses expand overseas.”
The expansion of Dubai International Chamber’s overseas offices was followed in January 2024 by an additional USD 140 million in funding from Dubai’s Crown Prince Sheikh Hamdan bin Mohammed to help SMEs gain quicker access to global markets.
Funding, accelerators
Development funds and agencies such as Dubai SME, Future Industries Lab and the Khalifa Fund for Enterprise Developers, continue to offer invaluable support for SMEs to further strengthen the sector’s ecosystem. Yet further support is available from the Ministry of Economy’s Entrepreneurial Nation initiative, which targets 20 startups for unicorn status by 2031. Expansion for SMEs into international markets is helped by a USD$100-million VC fund established by Dubai’s Crown Prince Sheik Hamdan in 2021 to spur the SME ecosystem into further growth and expand overseas.
Additional initiatives include FinTech Hive, the Dubai Technology Entrepreneur Campus and Dubai Future District Fund, with ambitions to acquire USD 1 trillion in tech assets under management by 2025.
Growth opportunities for Dubai tech startups: AI, fintech and smart cities
Zeroing in on future growth in the tech sector, the principal focus areas for tech startups in the government’s overarching vision for Dubai are artificial intelligence (AI), smart cities and infrastructure, fintech, energy production and energy-efficiency technology.
The government’s AI strategy envisages integrating AI into various business and government sectors, from banking, education and healthcare to travel, mass transit and government services. Dubai was the first jurisdiction in the world to appoint a government minister back in 2017 specifically for AI growth. As if to underline the wide variety of potential applications for AI, Microsoft founder Bill Gates recently took part in a series of UAE events to demonstrate how AI can help farmers and agricultural industries.
Fintech in Dubai has grown exponentially, with blockchain and digital payments that bypass traditional banking organisations taking centre stage. To help this growth, the UAE’s Central Bank has devised regulatory sandboxes to encourage fintech startups to test and develop their products and platforms. This is all backed by an overarching educational and inward immigration policy to encourage tech expertise in Dubai and the wider UAE, individuals who the government sees as “strategic enablers to the UAE digital economy”. The National Program for Coders, CodersHQ and One Million Arab Coders, are all carefully designed to train coders from local and international markets.
Dubai is renowned for its smart-city ambitions and is planning to deploy new and emerging technologies, from energy efficiency to mass transit, that will enhance the experience of urban living. With the Dubai 10X Initiative, launched by the Dubai Future Foundation, Dubai plans to position the city decades ahead of other important urban centres around the world by adopting bold, disruptive technologies. Autonomous driving, ride-hailing, and the development of smart interconnected digital urban environments will create a digitally connected smart city with hyper-connectivity in which transport and traffic become part of a city-wide digital ecosystem.
Dubai: where tech SMEs come to grow and thrive
Hands-on help to enable tech startups to scale up quickly and truly become global players is abundant and increasing constantly. Dubai has rapidly developed into a highly dynamic hub for tech startups, creating a tech and SME ecosystem with seemingly limitless possibilities.
Driven mainly by a highly strategic and forward-thinking government that shows all the signs of being committed to tech innovation and a digital economy beyond hydrocarbons, no other jurisdiction offers tech SMEs a more conducive environment for internationalization.
