The UAE sets an ambitious target to become home to 20 unicorns by 2031 by attracting skilled talent and foreign capital into the economy, its Minister of State for Entrepreneurship and SMEs said.
At the launch of the Entrepreneurial Nation project in Dubai, Ahmad Belhoul Al Falasi said the UAE aims to do more to solidify its position as a top destination for international investment in the Gulf.
“We want to be home to 20 startups worth more than $1 billion each by 2031,” the minister said at the media briefing on Wednesday.
He said the Entrepreneurial Nation project will offer support through a series of public-private partnerships that help entrepreneurs set up in the UAE, expand their businesses, export their products and tap into online sales.
Under the Entrepreneurial Nation initiative, the programmes are expected to start later this month. The project will offer a unified destination for start-ups from inception to growth, according to the presentation. It will polish entrepreneurial skills and benefit students, recent graduates, employees, retirees, homemakers and jobseekers, among others.
Dh1 billion fund
Al Falasi said the UAE is planning to establish a Dh1 billion private equity fund to support UAE-based startups and SMEs operating in key sectors.
“The ministry is still considering whether the new fund for start-ups and SMEs will be for early stage or late-stage businesses. We will only intervene when there is a need to support the businesses,” he said.
He said the UAE has announced visa and business reforms aimed at attracting more expatriates to live and work there, after businesses suffered last year from the coronavirus outbreak.
“The government plans to offer funding in several formats, including equity, direct lending and loan guarantees, to boost startups and entrepreneurship,” the minister said.
Competition on the rise
The UAE has lately seen increased competition from Saudi Arabia, which has been pushing foreign firms and startups to invest there and set up regional headquarters in Riyadh.
“When it comes to entrepreneurship specifically it’s always about competition,” Falasi told Reuters when asked about competition with Saudi Arabia.
“Every country is different, Saudi Arabia is a different market than UAE. Entrepreneurs view the UAE as a platform for growth into the region,” the minister said, adding that the UAE has an advantage attracting foreign capital because its population is overwhelmingly foreign workers.
“So foreigners feel much more confident starting theirs business in a country, which has 90 per cent expatriates as opposed to other countries,” he said.
Experts hailed the initiative
Shailesh Dash, a Dubai-based financier and entrepreneur, said the UAE has built the right infrastructure and it’s ecosystem supporting the startups is quite good.
Referring to latest target for unicorns, he said it’s the right thought process and the country has already laid down a solid foundation to groom dozens of startups and convert them into a multi-billion business venture.
“I think with the current ecosystem being built up in UAE and surrounding countries it’s perfectly achievable target subject to none of the extraneous events happening. With various new laws attracting newer skill sets to the economy such as coders, freelancers and financiers into the ecosystem, it would all help in this building up of unicorns in coming years,” Dash told Khaleej Times on Wednesday.
Saad Maniar, Senior Partner at audit and consulting firm Crowe, said DIFC is heavily investing in attracting innovation and startup companies to the centre, since the start of Covid-19, and in parallel has developed a framework for the innovation and startup to thrive.
“These kind of initiatives will continue to attract startups and UAE will continue to lead in this space,” he said.
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