Dubai Next successfully finances the first community supported project

Launched by HH Sheikh Hamdan bin Mohammed in May 2021

  
Abdul Baset Al Janahi (right), CEO of Dubai SME, and Saeed Al Marri (left), Deputy CEO, with Yousuf Al Arif, Founder of Padel 26

Abdul Baset Al Janahi (right), CEO of Dubai SME, and Saeed Al Marri (left), Deputy CEO, with Yousuf Al Arif, Founder of Padel 26

  • Within one month from launch the digital crowdfunding platform supported an entrepreneurial initiative to raise 100% capital required

Dubai Next, the first official crowdfunding platform in Dubai launched last month by His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Executive Council, has achieved a remarkable success within a short span of time by enabling an Emirati entrepreneur to raise the capital required and launch his startup. The startup, named ‘Padel 26,’ saw an overwhelming response from contributors after launching its campaign on Dubai Next to generate AED100,000. The rest  of the capital was financed by The Mohammed Bin Rashid Fund.

A progressive step towards bringing the benefits of startup funding and digital technology to innovators, entrepreneurs, investors and the society, Dubai Next allows entrepreneurs to create campaigns online to seek funds for turning their ideas into reality. The not-for-profit crowdfunding platform operated by Dubai SME, the agency of Dubai Economy mandated to develop the small and medium enterprise (SME) sector, is open to all nationalities and age groups in the UAE.

The Padel 26 campaign was brought on Dubai Next after the entrepreneur worked on the business plan and feasibility studies for a year. The project involves four indoor doubles courts of Padel, a sport that requires less space than the normal tennis court. The Mohammed bin Rashid Fund, the financial arm of Dubai SME, financed the rest of the capital required, thus enabling Padel 26 to be the first project to successfully raise  capital on Dubai Next.

Crowdfunding involves small amounts sourced towards capital financing of a single commercial venture. The method provides access to a large segment of the society for funding and facilitates financing amongst entrepreneurs and their family as well as friends.

Anyone with an innovative idea or project, whether an individual or a company, can create campaigns on Dubai Next. Any business idea, except for activities that require to be shari’a compliant, are eligible for funding on the platform. The location of the business should be in Dubai.

The campaigns are then brought to life with the direct support from contributors in the community.

Individuals or companies can contribute to support a campaign initiated by a friend or family member. Contributors get to choose from a variety of unique rewards offered by the campaign owner. The amount contributed can be refunded if the campaign fails to reach its target.

“Contributors may have many reasons to support a campaign. Either they may be inspired by the project or the expected reward, or want to support a friend or family member. Whatever be the reason, people have the opportunity to contribute towards bringing a novel idea to life.  Contributing to a campaign doesn’t help the campaign owner or the contributor only, but it eventually supports Dubai’s economy too,” says Abdul Baset Al Janahi, CEO of Dubai SME.

Campaign owners keep 100% ownership of their project. The Dubai NEXT platform cannot be used to offer equity or financial returns.

Dubai Next has seen 543 campaigns submitted on the platform since its launch, and 44 of them have been live on the platform. The projects involve innovative ideas in diverse industry sectors, such as business, food, technology, education, design, film & video, gaming, health, and arts. Total funding requested so far has exceeded AED 27.7 million and the projects have received 72 contributions from 58 supporters.

Vemudra, another innovative initiative by two 16-year-olds to create an institute aggregator website that helps students to develop extracurricular talents, has also been able to raise 100% of the funds it required on Dubai Next, following Padel 26.

“We encourage students of all age groups too, especially graduates who seek funding for their graduation projects, to use Dubai Next as an opportunity to turn their ideas into reality. The 50 Year Charter of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, seeks to transform universities into free and creative economic zones, and Dubai Next is aligned to His Highness’s vision,” said Al Janahi.

Facilitating access to financing for startups is a major focus of entrepreneurship development strategies in Dubai and across the UAE. Conventional lenders still have their concerns on providing startup funding. Dubai SME has been co-ordinating policies and initiatives, both government-level and collaboratively with the private sector, to bridge this gap through encouraging startups to adopt corporate governance practices, and simultaneously unlocking innovative funding options.

Creating more opportunities for entrepreneurs and startups has its dividends - it enhances SME contribution to economic development, and strengthens inclusivity, innovation and sustainability. Small and medium enterprises make up nearly 95% of all companies in Dubai, employ 42% of the workforce, and contribute around 40% to the GDP in the emirate.

Dubai Next has provided a solution for the next generation of entrepreneurs to  highlight their diverse capabilities, and secure community support, guidance and follow-up, thus benefitting from the strategic goal of Dubai to promote knowledge and technologies, and grow sustainably. While traditional means of raising capital allows entrepreneurs to approach only key mainstream pool of investors, a digital crowdfunding platform allows entrepreneurs to reach thousands of potential investors from a single platform, drastically increasing fundraising options.

For more information on Dubai Next, visit https://dubainext.ae 

-Ends-

About Dubai SME

Dubai SME, an agency of Dubai Economy (Department of Economic Development - Government of Dubai) aims to foster an entrepreneurial culture and develop a competitive SME sector for the Emirate of Dubai. The key strategies adopted by Dubai SME are: advocate a pro-business environment for developing entrepreneurship and SMEs, seed innovative start-ups and groom promising SMEs.  Dubai SME’s vision is to make Dubai the centre for innovative SMEs to start, grow and expand their businesses, thus adding greater value to the economy of Dubai. 

For further information, please contact:
Faisal Shamsudheen
Tel: (971 4) 445 5927
Email: MediaRelations@dubaided.gov.ae 

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