Over the last three years, the decline in oil prices might have put other Middle Eastern economies at some risk but Dubai, one of the five fastest-growing metropolitan areas in the world, has instead diversified, drawing tech talent from around the world.
“It is establishing itself as the destination of choice for tech startups seeking to access emerging markets, says Muhammed Mekki, founding partner of Astrolabs, a tech hub that hosts entrepreneurs from over 40 countries.
“With over 2 billion people living within a four-hour flight radius and the right infrastructure to support a thriving start-up ecosystem, Dubai is a compelling location to consider for founders from around the world.”From Careem, a Dubai-based ride-hail start-up, to Bridg, a mobile-to-mobile payment platform that leverages the power of Bluetooth, and Souq.com, the Middle East’s first unicorn, many tech startups are scaling up their businesses from Dubai.
Case in point: Founded in 2013, Careem, which raised a total of $71.7 million in funding, has expanded in 26 cities across the Middle East & North Africa (MENA) as well as Pakistan.
As of January 2016, the company has seen a 30% increase in trips and has seen profitability in the UAE.The boom is driven not just by the growth of incubators and accelerators such as Turn8, ImpactHub, Astrolabs Dubai and In5 spearheading the drive to make Dubai the next Silicon Valley of the world, but also the support from government and semi-government institutions that represent the most vital sectors in the government’s agenda, such as health, education, transportation, infrastructure and renewable energy.
Also, the declining cost of technology means more entrepreneurs having the tools to build new companies.With the recent shift witnessed globally, experts say it is an opportune time for corporate investors to look out for alternatives and diversify into entrepreneurial ventures to gain medium to long term returns.A first in the region, Google has been collaborating with Astrolabs to enable start-ups to innovate and grow. As part of the global Google for Entrepreneurs partner network, Astrolabs share techniques and facilitate exchanges with the other leading tech hubs around the world to enhance the experience of start-up entrepreneurs.
“We collaborate with the Google office in Dubai as well as in Silicon Valley to offer local entrepreneurs mentorship and other learning opportunities to help them grow their companies,” says Astrolabs’ Mekki. “Also, our partnership with Dubai Multi Commodities Centre enables our entrepreneurs to quickly set up their companies within a free zone environment under a subsidised fee structure, an essential enabler for our young start-ups to successfully get off the ground.”
Meanwhile, Turn8, a venture fund that scouts globally for startups, inviting them to Dubai for a three to four month long programme and seed funding them with $30,000 to help accelerate the idea to market, currently has a portfolio of over 60-odd startups. “The good news is more than 60% are active, which is quite a high rate. We are trying to increase the scale of businesses and have also launched more growth accelerator programmes,” says Ahmed Abdulwahab, head of Turn8 Accelerator. Adds Abdulwahab:
 

In the last three years, there’s been a clear movement for innovation. Most of the tech companies are customised for the local environment; copy-paste technology does not fit the bill anymore. There are several cutting-edge technologies that have completely changed the landscape in the recruitment process, food technology and e-healthcare in Dubai.

Angels and venture capitalists are also growing steadily, shifting focus from traditional investments, such as real estate, to tech startups. While Eureeca is a crowdfunding platform that connects startups to a pool of investors, Magnitt also connects startups to investors.

The population of United Arab Emirates has exploded from less than a million a decade ago to more than 9 million today; about 80% of those are expats. “Going by the demography of the population, tech startups are, obviously, expat-driven, but more and more Emiratis are coming up with innovative ideas,” adds Abdulwahab.

There’s a growing participation of women in tech startups across MENA as well. “Women comprise about one-third of our course participants around the region and about 25% of our current membership base. We regularly host events to encourage women in the tech sector and strive to create an inclusive community,” says Mekki.

The service sector in Dubai, which accounts for more than 70% of total GDP, also provides a significant prospect to startups by giving them a chance to showcase their ideas to potential investors. There are plenty of support groups, meet-ups, and a growing number of co-working spaces to help facilitate interactions as well.

Summing up the growing attraction of Dubai as a tech startup hub, Abdulwahab says:

Dubai is a whole world in a small city. The emirate is way advanced in technology when compared with other Middle Eastern countries. Many of the biggest companies in the world are directly and indirectly represented in the emirate; it is a financial destination. The eclectic range of customers, demands and demography gives rise to innovative tech start-ups to suit their needs.