ENTREPRENEURSHIP / JUN. 11, 2014
version 6, draft 6

How To Find Investors in the UAE

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There’s a lot to like about the United Arab Emirates (UAE) as a potential location for a new business looking for investors. It’s world-famous, a thriving financial hub, popular with expats (the majority of residents in Dubai and Abu Dhabi are not indigenous), and its economy is booming. 

It is definitely a good idea to use a local business consulting firm like Aryan Business Consulting to walk you through the paperwork (i.e. red tape and headaches) and connect you with local partners should that be necessary. Other than that, there is PLENTY of money in the UAE just waiting for the right investment opportunity to come along.

A Stumbling Block?

Setting up a business in the UAE is not without its obstacles...you’ll need a resident permit and business license, as well as a “local sponsor” who is given 51% of the ownership stake. That’s a hefty price tag. There are sometimes ways around that requirement. You could explore the possibility of setting up in one of the many “free zones”. These areas - specifically set aside for foreign business - are part of the country, but considered outside of the normal customs territory. The rules are different within their boundaries, and they include 100% foreign ownership and tax exemptions. The downside? Many of them are well removed from foot traffic, and the cost of space is often quite high. A perfect solution? No. But worth examining in closer detail.   

Local Events

The Dubai Investor Forum holds a monthly event that brings entrepreneurs, venture capitalists, and angel investors together. It accepts six entrepreneurs each month, and they pay a presentation fee to participate, but the cost includes six 1-hour sessions prior to the event, on-site assistance on the day of, and a (roughly) 30-minute block of time in front of the investors, as well as facilitating private meetings with interested parties afterwards. If you can get in, it could very well prove the best investment you could possibly make in yourself and your startup.

Venture Capitalists

There are a lot of local (the UAE, the GCC, or MENA) firms in the country, as well as branches of international ones. The Carlyle Group is perhaps the biggest player in the region, with investments and funds in the billions. Local VC firms have large assets and money available to them, and many are owned either partially or outright by the ruling families in the UAE. They are looking to invest in both local and international startups in a wide and all-encompassing range of industries.

Other Useful Links

Fajr Capital

BECO Capital

iMena (mainly interested in consumer internet businesses)

gfh Capital

MENA Private Equity Association

Angel Investors

The stereotype that all Emiratis are rich is just that - a stereotype. It’s simply not true. That said, there are many wealthy Emiratis and expats alike that are looking to increase their own wealth and give back to the region via investing in businesses that fill a niche or need. Angel investor groups are popping up all the time, and most have a monthly (or even more frequent) pitching event to bring investors and entrepreneurs together. Envestors is a consulting company with a network of private investors. It provides a slew of other services in additional to just finding an angel investor(s) for you.

Accelerators and Incubators

Believe it or not, the UAE also has a growing number of startup accelerators and incubators available to local entrepreneurs. In most cases, if your application is accepted, you receive a little seed money (usually $5000-20,000), physical office space, business training, mentorship, and at least one pitch or demo day at the end of the program. Dubai has a “city” for many major industries (Internet City, Media City, etc.) where like-minded businesses and companies congregate, and the accelerators and incubators tend to fall within the corresponding city.

A few of the best include:

Afkar.me (an incubator focusing on startups with a digital product)

i360 (an accelerator that only accepts startups in the idea phase)

Turn8 (an accelerator focusing on the supply chain and logistics industry)

SeedStartup (an accelerator; part of TechStars)

Silicon Oasis Founders (early tech startups)

There are hurdles to starting up in the UAE, but finding the capital to get going isn’t one of them. The money is there. Waiting. Understand the specific challenges associated with doing business in the UAE, ideally utilize a local consulting firm, and then get to work.

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