The ruler of Dubai tweeted on July 28: “Dubai’s impact on the global start-up scene shows the vision and spirit of the region’s youth in shaping tomorrow’s businesses.”
The UAE uses a range of measures to attract global talent, offering young tech founders a suitable base for their start-ups. Running a $54.5m innovation programme, the Abu Dhabi Investment Authority recently backed seven international tech companies with more than $23.6m to establish their activities in the UAE capital.
Sharjah, the third-largest Emirate, is also offering a wide range of ‘sand pits’ and technology parks while Dubai-based Future Foundation is actively seeking to attract emerging tech specialists abroad. These efforts are bearing fruit. In 2020, the UAE had the leading regional start-up ecosystem by number of venture capital (VC) transactions (26% of 496) and volume of invested funds (56% of $1.031bn), according to the start-up data platform Magnitt.
However, the importance of start-up ecosystems for economic development is not limited to the rich Gulf States. New tech-savvy and innovative generations in many African countries are disrupting industries and creating homegrown solutions for domestic problems, following the footsteps of legendary mobile payments company M-Pesa.
However, the fact that 80% of the funds came from outside Africa shows that once again there is vivid global interest in what probably is the most precious commodity African nations have: its talent. Every African nation is well advised to define and implement a comprehensive development strategy for its start-up ecosystem to keep their young founders to start their business “at home”. The global competition for talents is in full swing and there are certainly more aggressive “players” in this fierce hunt for African talent then the above-mentioned Gulf countries.
This article first appeared in the August/September print edition of fDi Intelligence. View a digital edition of the magazine here.