Experts Comment: How and Why Is Dubai Becoming a Hub for Startups?

It’s no secret that Dubai has quickly become one of the top locations for emerging startups. With the fourth largest economy in the Middle East, Dubai boasts a gross domestic product (GDP) of $415 million in 2023.

The business and startup ecosystem in Dubai is unique in that it boasts a population that is 90% foreign. And, in addition to that, Dubai is a major trading location, with two of the largest ports in the world and an incredibly busy international air cargo hub.

Dubai’s success in the startup scene has been very intentional, with plenty of effort being made to provide beneficial economic policies and encourage investment in Dubai-based businesses. With the government’s focus on innovation, especially in tech, along with the incredible tax benefits that the city offers entrepreneurs, it’s completely understandable why business owners are flocking to the UAE.

Primary Reasons Behind Dubai’s Success As a Startup Hub

The most obvious reason behind why so many entrepreneurs are flocking to Dubai is the financial advantages that the location offers, namely in terms of income tax. But, there are several other motivations behind the city’s gradual yet consistent rise in popularity.

• No Income Tax: Dubai is tax-free, with residents not having to pay corporate or personal income taxes. Not only does this eliminate a great deal of hassle, but it also allows businesses to save plenty of money, especially in the long term.

• Government Initiatives: Leadership in the UAE and Dubai specifically has made (and is making) a concerted effort to foster a culture of innovation and entrepreneurship. This comes, in part, as a way to diversify the economy away from oil. For instance, programmes like the Dubai10X Initiative aim to make Dubai a pioneering force in tech innovation, while the Dubai Expo has done a great deal in terms of attracting global attention and investment.

• Business-Friendly Policies: Dubai offers several different incentives for entrepreneurs and startups, including things like an easy business registration process, access to free zones and as little bureaucracy as possible. Indeed, free zones – in which companies can have 100% foreign ownership, no personal and corporate tax and repatriation profits – are a major selling point for Dubai. These policies make it easy for companies to be established and be successful in the long run.

• Strategic Location: There’s no doubt about the fact that Dubai’s central location – in between Asia, Europe and the Middle East – makes it ideal for businesses that are looking to expand into a variety of different regions. Furthermore, the city’s connectivity via both sea and air routes also enhances its appeal in terms of global trade. Overall, companies based in Dubai have excellent access to plenty of different markets.

• Top-Quality Infrastructure: Dubai boasts world-class infrastructure, including high-tech infrastructure, modern offices, excellent telecom networks and more, making it a great location for companies embracing digital transformation.

• Diverse Talent Pool: Since the city attracts people from all over the world, it’s become home to an incredibly diverse professional population, making it a great place to hire staff.

What Are Experts Saying?

Opinions on Dubai as an exciting new destination for innovation and emerging startups is varied, although most experts agree that one of the main factors behind the city being so attractive for business is the tax incentive.

However, while Dubai has a lot to offer new companies, there are also several challenges that startups may face while being based in the city.

Our Experts

• Am Golhar: Founder of Abstract PR
• Paul Armstrong: Founder at TBD Group
• Leonid Kil: CBDO & Co-founder at Diagram Capital
• Peter Wood: CTO at Spectrum Search
• Sarah Austin: Director at British Business Excellence Awards
• Richard Stone: Founder and Managing Director and Stone Junction
• Yousef Khalili: Global Chief Transformation Officer & CEO MEA at Quant
• Chris Paul: Managing Partner at Hoxton Wealth
• Aliaksandr Kuushynau: Head of Wialon
• Hiba Chamas: Business Development Director, Americas and MENA, at RTGS.global

Am Golhar, Founder of Abstract PR

Paul Armstrong, Founder at TBD Group

“Dubai’s emergence as a startup hub stems from tax-free benefits, a strategic location and strong government-backed initiatives. However, high operational costs, reliance on foreign talent and complex regional regulations pose challenges to scalability, sustainability and livability.

Tech and innovation sectors thrive, but traditional SMEs remain underserved, limiting broader diversification. Dubai’s future success hinges on reducing operational costs, fostering local talent and creating a more balanced ecosystem that supports diverse industries.

By minimising dependence on external resources and adapting to global trends, Dubai can build a more resilient, inclusive startup environment.”

Leonid Kil, CBDO & Co-founder at Diagram Capital

“Dubai offers a business-friendly environment with no personal income tax, low corporate taxes and streamlined business setups, especially in free zones offering 100% foreign ownership. It benefits from strong government and private funding, including venture capital, accelerators and initiatives like Dubai Future Foundation. With government-backed infrastructure, innovation-driven projects and tax incentives, Dubai is a thriving startup hub.

The city also provides a cosmopolitan lifestyle, attracting global talent with its safety, diversity and modern amenities. Its strong expat community creates a rich talent pool, while the vibrant culture and high quality of life appeal to entrepreneurs.”

Peter Wood, CTO at Spectrum Search

“Dubai is a prime spot for startups thanks to its location between East and West, which makes it a perfect launchpad for global markets. But it’s not just about geography—Dubai’s got a flexible regulatory approach, especially when it comes to tech, so there are fewer roadblocks for new ventures. Plus, with the government pushing AI, blockchain and digital initiatives, tech startups are finding it increasingly attractive.

Another big draw is the city’s diverse talent pool. People come from all over, bringing fresh ideas and different perspectives. Dubai’s focus on innovation hubs and its investment in new tech means startups aren’t just thinking local – they’re building with a global audience in mind.”

Sarah Austin, Director at British Business Excellence Awards

“With the autumn budget set to be the highest tax rise in history, it is no surprise that the UK Government is single-handedly handing over its tech hub to Dubai.

Dubai has a history of pushing boundaries and of course its favourable tax structures – but it is now going to be the place to start a business. Surrounded by likeminded expats, it boasts lightning-fast internet, a progressive approach to supporting start-up communities and easier access to funding opportunities.”

Richard Stone: Founder and Managing Director at Stone Junction

“Dubai’s rise as a startup hub is driven by a business-friendly environment, with minimal taxes and a legal framework that supports foreign investment. As consultants, we have an insight into this, especially as startups in the area often look for an agency with native UK English and to match their global marketing language, as well as fluent Arabic.

Dubai’s infrastructure, including cutting-edge digital connectivity and access to major global markets, provides an ideal foundation for tech startups, in particular. In Addition, Dubai’s ambitious government initiatives, such as the Dubai Future Foundation, nurture innovation and attract talent, making it a magnet for entrepreneurs.

Historically, many of those entrepreneurs considering the Middle East, might have been attracted to Israel, often called the start-up-nation, but political instability in the area makes this harder right now.

Looking ahead, Dubai is well-positioned to foster further growth in the tech sector, particularly in areas like AI, fintech and smart cities, which align with the government’s vision for a sustainable and tech-driven future.”

Yousef Khalili, Global Chief Transformation Officer & CEO MEA at Quant

“Dubai has become a true magnet for tech startups in recent years. By late 2023, new startups in Dubai had a value of $23 billion.

What makes tech entrepreneurs come to Dubai? It provides a tax-free environment with good backing from the government. Tech pioneers love this place because it delivers the most cutting-edge infrastructure in the region and a friendly environment to experiment and grow. It’s also centrally located geographically.

Dubai is becoming a leader of advanced technologies like artificial intelligence, robotics and sustainable tech solutions. Many dedicated communities and spaces are being created in the city such as Dubai Future District and the AI Hub at the Dubai Multi Commodities Center ( DMCC) where these ideas can grow.

Dubai’s tech scene has a variety of things to offer from smart city initiatives to blockchain applications. The future of the technology is no longer about skyscrapers. Dubai and the UAE is where the future of technology being shaped.”

Chris Paul, Managing Partner at Hoxton Wealth

“The UAE has been a fantastic place to start and grow our business over the last six years. It’s an incredibly attractive place for talent acquisition, as highly skilled people from across the world want to move to the UAE.

Dubai is a cultural melting pot, and the same can be said for our business. We have team members from across Asia, the UK, the US and Europe — all of them are ambitious. It takes a special kind of person to leave their home country and build their life elsewhere.

The government here has created an environment where businesses thrive, and things get done quickly. Every continent needs a major commercial hub, cities like New York, London and Singapore serve this role in other regions.

The Middle East and North Africa region was missing that hub until Dubai stepped up. Over the last 10 years, Dubai has rapidly evolved into a major global player and I regularly speak with colleagues from around the world who are keen to open businesses or offices in Dubai, rather than in legacy hubs.”

Aliaksandr Kuushynau, Head of Wialon

“In the fleet management and IoT technology sector, Dubai has become a key global hub for emerging startups. One of the key “vehicles” for channelling business opportunities for startups is Dubai’s flagship event GITEX Global, hosted each October at Dubai World Trade Center. It is one of the biggest tech events worldwide, spanning 5 days, attracting hundreds of tech giants, trailblazing startups and over 200,000 visitors. It’s a very good reflection of the region’s global tech ambition, and of the huge commitment and resource that it deploys to power this ambition.

Wialon, which is one the world’s largest fleet management and IoT software platforms, has exhibited here for the past 10 years, and over the past decade, Dubai has become a pivotal hub for us. We host a regional convention for our over 2,700 partners here each year, and this year we also announced in Dubai the winners of our global competition IoT Project of the year.

In our sector, Dubai is also a key hub thanks to the region’s ambitious sustainable development goals, including UAE Vision 2021 and Saudi Vision 2030. There is a growing push for electric vehicle (EV) adoption, which has led to the rise of many startups in sustainable mobility. We have seen strong growth in the number of service providers and integrators who work with the Wialon platform to develop their solutions for fleet managers in the region.”

Hiba Chamas, Business Development Director, Americas and MENA, at RTGS.global

“Dubai has emerged as a leading global fintech hub, driven by innovation, strategic incentives and world-class infrastructure. The Emirate’s leadership actively invests in smart city projects, blockchain and AI technologies, reflecting its commitment to future-focused growth.

Tax-free zones such as Dubai Internet City, offering 0% corporate tax and 100% foreign ownership, attract international businesses, while the DIFC Fintech Hive provides startups with essential support through training, funding and mentorship for founders. Dubai’s geopolitical neutrality and economic stability further enhance its appeal for international financial operations.

World-class infrastructure, including high-speed internet, efficient transport and Dubai International Airport’s global connectivity, further cements its role as a strategic fintech hub bridging eastern and western economies, serving as a natural meeting point between Asian, European and American markets.”