DUBAI, 18th June, 2023 (WAM) — Dubai Chamber of Digital Economy, one of the three chambers operating under Dubai Chambers, has launched its third report on Dubai’s digital economy. The “Dubai’s Venture Capital Ecosystem” report provides an overview of the investor landscape backing the start-ups and scale-ups that are transforming Dubai and the MENA region. Commenting on the release of the report, Omar bin Sultan Al Olama, Minister of State for Artificial Intelligence, Digital Economy, and Remote Work Applications and Chairman of Dubai Chamber of Digital Economy, said, “The UAE’s advanced digital ecosystem has accelerated the development of the entrepreneurship sector and contributed to significant growth in its activity. The country’s proactive vision in developing legislation and initiatives in the digital field creates a favorable environment for startups and fast-growing companies, which has attracted unicorn companies and investors from around the world and consolidated the UAE’s position as a global hub for the digital economy.” Al Olama added, “The results in the report reflect our long-term commitment to developing smart digital solutions and deploying these to build a new and future-facing model for the economic sector in the UAE, and Dubai in particular, and underline the emirate’s position as a global capital for the future economy.” As Dubai sets its sights on becoming the global destination of choice for digital entrepreneurs, Dubai Chamber of Digital Economy is tasked with attracting leading tech companies, start-ups and scale-ups that can support Dubai’s digital ambitions. The chamber was created to build the world’s best digital infrastructure and transform Dubai into an international technology hub. With a series of visionary initiatives and investments in cutting-edge technology, Dubai is well on its way to achieving its ambitions. From its world-class fiberoptic network and cloud-based systems to its innovative approaches to smart city development, Dubai has set the standard for how cities can leverage technology to enhance the lives of its citizens and attract global businesses. Just one recent example is the opening of the Moro Hub in February 2023, world’s largest solar-powered data centre. The 100-MW facility is a Dubai 10X initiative, which is an innovative program launched by H.H. Sheikh Mohammed bin Rashid Al Maktoum in 2017. The initiative entails government entities creating disruptive, exponential change, placing Dubai 10 years ahead of leading global cities. According to the report, a total of 749 scale-ups across the MENA region (excluding Israel), have raised a total of over US$19.5 billion cumulatively over the past decade (2012-2022), with UAE scaleups accounting for 65 percent of total cumulative capital raised across the region. Today, Dubai is home to over 40 percent of the MENA region’s scale-ups, with 306 scale-ups calling the emirate home. Dubai still accounts for over 90 percent of all scale-ups in the country, which is home to 338 scale-ups in total. Dubai’s 306 scale-ups have raised over US$11.7 billion in funding over the course of the past decade, which represents an impressive 60 percent of the MENA region’s total cumulative fundraising total. In addition, in 2022, Dubai-based startups doubled-down on their prior year results, fundraising over US$2 billion. In addition, the growth of funding in the MENA region has exceeded US$4 billion in 2021 and 2022 and the number of mega-rounds of US$300 million or more has seen an increasing trend with three seen in 2021 and six in 2022, including two scaleups listing on stock exchanges. In 2022, there was a significant shift in the number of funding rounds, where scale-ups raised funding, and a trend towards larger cheque sizes and funding bracket gained momentum. In the US$100 million to US$1 billion range, funding rounds increased by more than 100 percent between 2021 and 2022. Other funding ranges also saw increases between 20 percent to 87 percent. Considering the source of capital raise, venture capital and corporate rounds accounted for over three quarters of the capital raised, while IPOs and ICOs accounted for nearly equal share. The number of scaleups have also increased considerably, in Dubai, growing 26 percent between 2021 and 2022. In terms of absolute numbers, Dubai saw an increase of 64 scale-ups between 2021 and 2022 growing from 242 to 306 scale-ups. Venture funding in Dubai has seen tremendous growth in the past decade. From a time of only seed stage and earlier rounds, Dubai has grown to become the only city in the MENA region to be home to startups to raise funds in Series E and Series F rounds. The report, which was produced in collaboration with Entrepreneur Middle East, reveals that more than 30 percent of the funding rounds are attributed to startups headquartered in Dubai, implying 87 percent of all funding rounds for UAE-based companies are for firms headquartered in the emirate. By 2031, the national digital economy is expected to be conservatively valued at well over US$140 billion (from today’s US$38 billion). Together with Dubai Chamber of Digital Economy, it is the collaboration between stakeholders and ecosystem players that will ensure that Dubai becomes the next digital economy capital of the world. The report can be accessed at Dubais-Venture-Capital-Ecosystem.pdf (dubaichamberdigital.com).
Source: Emirates News Agency (WAM)
