Contrary to widespread speculations, the coronavirus pandemic in the UAE allowed Hub71 to more than double its number of startups that are housed at the Abu Dhabi entrepreneurship centre in the past 18 months. Companies are strongly reporting a doubling in their venture capital funding, with the average revenue increase by 35 percent after joining.
According to a renowned investment company, this increase in startups and VC funds amidst the pandemic has made Hub71 ready to compete on a global level alongside a breakneck race to attract talent.
Hub71’s chief operating officer, Jida Itani believes the major reason for this favorable pattern among the pandemic uproots from Abu Dhabi’s fierce competition in attracting startups. She also mentioned what the UAE has to offer today for startups is really powerful and is almost not easily replicable elsewhere.
The pandemic has made it clearly evident that Abu Dhabi is ready to learn lessons quickly and adapt within a short time span. These factors give Abu Dhabi a favourable advantage as a venture and startup market over other cities, mainly in terms of safety, reliability and livability. These are factors marketing experts and financial advisors can quickly sell to anyone looking to establish a business here.
Besides, the remodelled incentive Programme at the Hub71 is also showing a positive influence in increasing venture capital funding and startups amidst the pandemic. Even popular investment destinations like South Korea, Spain, Brazil and Singapore are providing some combination of incentives, subsidies, tax breaks and more agile policies with the aim of attracting entrepreneurs. To date, Hub71 has accepted 129 startups into its competitive incentive Programme, which began by offering subsidized housing, health insurance and office space for the first two years.
Creating a vibrant eco-system is a prerequisite for attracting investments and is also a critical sign of a growing economy. Hub71, with its consistent introduction and reformation of policies, has strived to maintain this eco-system ever since its inception in 1971 and even amidst the pandemic outbreak.
Progress And The Future
In the Hub71, fund-raising acts as a critical component. The number of VC partners has more than doubled since the breakout of the pandemic. As of now, there are 19 VC funds that are covering early angel and seed investing to bigger ticket investors, with $2bn in assets under management. In parallel, startups have raised a total of $59.9 from Hub71 VC partners to date.
In terms of future directions, a leading financial investment firm in Dubai said that the Hub71 is focusing and moving beyond freebies to attract entrepreneurs and investors to the space. The tech-hub is also said to have opened a Community Centre Of Excellence, a Programme for non-incentivized startups, investors, corporate and the government recently. The initiative behind the programme is to source high-quality tech-startups through a series of events that are open to organizations that look to connect with entrepreneurial talent. Besides these, more mature startups are also finding homes at the Hub71.
The music streaming service Anghami will also be going public through a special public acquisition on the Nasdaq, and is said to base its research and development centre at the Hub71. On the other hand, the Hub71-startup Nanoracks, a pioneer figure in commercial access to space, expanded with a new space AgTech company, StartLab Oasis, last month.
Furthermore, Hub71 is also witnessing increasing applications from technology firms that offer novel solutions to a Post-Covid world in different areas like education, communication and healthcare. All these favorable moves have convinced that Abu Dhabi’s Hub71 is shifting up a gear in startups and VC funds amidst pandemic.