Dubai's Venture Capital Ecosystem

Saudi Arabia

Previously:<a href="https://lucidityinsights.com/articles/expected-headwinds-in-dubais-funding-landscape"> Expected Headwinds in Dubai&rsquo;s Funding Landscape</a>

<h2>Key industries expected to thrive in 2023</h2>

Among the industries that are enjoying an increased investor interest, e-commerce and fintech take up the first and second position in terms of number of companies that have raised above US$1 million through their lifetime. There are also companies focused on healthcare, education and logistics that are raising funding. Nine foodtech companies have raised close to US$1 billion in total. However, majority of that is dominated by Kitopi. Social networking is also dominated by the funding raised by Telegram. Agtech was also among the ranks, but it was dominated by Advanta Seeds.&nbsp;

<img src="https://cdn.lucidityinsights.com/uploads/dubai-vc-ecosystem/articles/outlook-4/1.jpg" />

Graph: Top 15 Tech Industries in Dubai by Number of Scaleups, based on funding between 2010-2022

Noor Sweid at Global Ventures also said that &ldquo;the next five years will see more interest in start-ups operating in industries that localize systems of production and consumption in order to make them more efficient, resilient and secure. These include additive manufacturing (3D printing), supply chain management technologies, energy technologies that democratize access and are resource efficient, and agriculture technology that facilitate local production (such as controlled environment agriculture and vertical farming).&rdquo;&nbsp;

Walid Hanna at Middle East Venture Partners added that &ldquo;Other than the obvious AI and blockchain tech, I expect there will be a growing demand for impact investing, where investors will seek to align their investments with their values and support solutions that address local, social and environmental challenges.&rdquo; He also expects an acceleration in digital transformation of industries that have been previously slow to adopt technology.&nbsp;

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<h2>Where&rsquo;s the patient capital for deep tech?</h2>

However, almost all of the investors said Dubai is still not a market where there is a lot of patient capital, a requirement for deep tech and strong R&amp;D developments. Investors agree that deep tech companies may struggle to attract local capital, as they typically require more time and resources to bring their products to market.

As such, deep tech investments are a relatively new concept in Dubai, and the city is still in the early stages of developing a deep tech ecosystem. Hanna at Middle East Venture Partners believes that &ldquo;in order to promote investments in longer-cycle deep tech ventures, there needs to be a supportive regulatory environment and access to capital, as well as a talent pool with expertise in these areas.&rdquo;

<img src="https://cdn.lucidityinsights.com/uploads/dubai-vc-ecosystem/articles/outlook-4/hanna.jpg" />

<h3>To get the lay of the investor landscape across Dubai and MENA, and for insights provided by the investors backing the start-ups and scale-ups that are changing the face of entrepreneurship in the region, read the report by&nbsp;clicking <a href="http://lucidityinsights.com/reports/dubais-venture-capital-ecosystem/read">here</a>.</h3>

Exciting Investment Prospects: Tech Sectors Set to Shine in 2023

Key industries expected to thrive in 2023

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