The past few decades saw the United Arab Emirates (UAE) come to the fore of the global landscape and display the potential it holds. The civil engineering marvels, amazing tourist destinations and a booming startup culture are among the first few things that come to mind when speaking of the UAE. However, none of it was just happenstance, especially the thriving startup culture. It is a result of continuous efforts towards turning the UAE into a conducive environment for startups and SMEs. In this article, we are going to explore the foundational elements of the startup culture in the UAE. It will help us understand why so many entrepreneurs are now turning to the UAE to set up their businesses.
1. Supportive business ecosystem One of the primary reasons behind the thriving startup culture in the UAE is the ecosystem that makes it easy for entrepreneurs to grow their businesses. For instance, Future 100 is one such initiative launched to help startups accelerate growth. The program identifies startups and SMEs making promising contributions to the UAE’s future economic sectors. The program not only encourages startups but also provides them with acceleration support. The UAE also attracts venture capital investments which further catapults startups to success. The businesses in the UAE received nearly 2 billion in funding for the year 2022. Furthermore, the UAE has a healthy network of incubators and accelerators to support their startups. Apart from these, the low taxation policies of the country play a huge role in attracting some of the best entrepreneurs. Based on the nature of business activity and the region, you might have to pay no tax whatsoever on the profits you make. 2. Modern infrastructure The UAE offers state-of-the-art facilities and infrastructure to startups and SMEs. It helps entrepreneurs focus on what matters the most and move the needle. Be it the transportation network or the digital infrastructure, the startups in UAE enjoy world-class facilities at their disposal. 3. Strategic location The UAE’s strategic location on the world map turns out to be a huge advantage for the startups in the country. With easy access to global trade routes, startups in the UAE can easily access the international markets. Additionally, the world-class seaports and transportation infrastructure become an additional advantage for startups in the UAE. The government of the UAE has also entered into Foreign Trade Agreements (FTAs) with multiple nations like the USA, India, Australia and more, which further makes it easy for startups and SMEs in the UAE to do business with the rest of the world. 4. Free zones Free zones in the UAE are dedicated economic areas where businesses can trade goods and services with special regulations and huge tax benefits. Another advantage of business set-up in the UAE free zones is 100% business ownership. There are over 40 free zones in the UAE with dedicated infrastructure and specific regulations to help specific business activities. In free zones like Ras Al Khaimah Economic Zone (RAKEZ), you can easily get a licence for business along with necessary arrangements like warehouse, office space, etc. 5. Access to talented workforce A business is built by its people. Thanks to its taxation policies and other incentives, the UAE is now home to some of the best minds on the planet. If you are a startup in the UAE, you get access to a talented workforce from around the globe. You can find a skilled workforce for all business operations across various hierarchical levels. 6. Technology and innovation Another major reason why startups are doing so well in the UAE is their focus on technology and innovation. Some of the leading startups in the UAE are tech-based. Fenix Games, Alaan and Tabby are among some of the advanced tech-based startups based out in the UAE.
If you are interested in leveraging the startup culture in the UAE, then you might want to consider RAKEZ to set up your business. It offers a wide variety of custom services for various business activities. From simple business licence applications to getting warehouses of a preferred size, our Business Development professionals can help you set up everything so that you can focus on operations and growth. Contact us now to discover new possibilities for your startup in the UAE. Frequently asked questions 1. What makes the UAE's business ecosystem supportive of startups? Answer: The UAE has created a supportive business ecosystem through initiatives like Future 100, which helps startups accelerate growth by providing resources and recognition. The country also attracts significant venture capital investments, has a robust network of incubators and accelerators, and offers low taxation policies, making it an attractive environment for entrepreneurs. 2. What are the benefits of setting up a business in the UAE free zone? Answer: Free zones in the UAE offer special regulations, huge tax benefits and 100% business ownership. There are over 40 free zones tailored to specific business activities, providing dedicated infrastructure and simplified processes for obtaining business licences and necessary facilities like office space and warehouses. 3. How can RAKEZ help in setting up a startup in the UAE? Answer: RAKEZ offers a comprehensive range of custom services for various business activities, including assistance with business licence applications and provision of office space and warehouses. Their Business Development professionals provide support throughout the set-up process, allowing entrepreneurs to concentrate on their operations and growth. Contacting RAKEZ can help discover new opportunities for your startup in the UAE. 4. What are the main differences between setting up a business in the UAE mainland and a free zone? Answer: Setting up a business in the UAE mainland allows you to trade anywhere in the UAE and offers a wide range of licence types. However, you may need a local sponsor and may not own 100% of the business depending on the nature of the activity. In contrast, free zones offer 100% foreign ownership, lower tax rates and streamlined processes but limit your ability to trade directly with the mainland.
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