Abu Dhabi is MENA region’s fastest-growing emerging startup hub, reveals study

Abu Dhabi has emerged as the fastest-growing emerging ecosystem in the Middle East and North Africa (MENA) region, achieving a 28 per cent growth in ecosystem value, according to the 2024 Global Startup Ecosystem Report (GSER) by Startup Genome and the Global Entrepreneurship Network.

The report, launched during London Tech Week, highlighted the rapid development of the emirate’s startup landscape, driven by significant activity at Hub71, the city’s global technology ecosystem.

GSER 2024, renowned for its quality-controlled dataset on startup ecosystems, analysed over 4.5 million companies across more than 300 entrepreneurial innovation ecosystems.

The report ranks the top 40 global ecosystems and emerging ecosystems while providing deep insights into startup trends worldwide.

Abu Dhabi: Performance highlights

The emirate’s ecosystem value soared to $4.2bn between July 2021 and December 2023, marking a 28 per cent compound annual growth compared to the previous two-year period.

The capital’s ranking improved by 15 spots from the previous year, placing it in the 61-70 group. Total early-stage funding during this period amounted to $284m, while total venture capital funding from 2019 to 2023 reached $1.06bn.

Additionally, the GSER recognised the emirate’s achievements in various categories within the MENA region. It ranked…

• Second in performance: Measuring the ecosystem’s size and performance based on accumulated tech startup value
• Fifth in funding: Assessing innovation through early-stage funding and investor activity
• Fifth in talent and experience: Evaluating long-term trends in performance factors
• Among the top 10 in knowledge: Focusing on innovation through research and patent activity
• Among the top 15 in ‘bang for the buck’: Measuring the runway tech startups acquire from a VC round
• Among the top 15 in affordable talent: Assessing the ability to hire tech talent

The report also highlighted the emirate’s strengths in the fintech, agtech and new food, and climate tech sectors, citing the density of talent, support resources, and startup activity.

The emirate’s strategic location and Golden Visa programme were highlighted as significant factors attracting startups.

Hub71 and other government bodies praised

Ahmad Ali Alwan, CEO of Hub71, emphasised the emirate’s conducive environment for startups: “Abu Dhabi’s rise as a leading startup ecosystem in the region is a testament to the opportunities it offers entrepreneurs worldwide. Its favourable environment creates funding and commercial prospects and establishes the foundation for startups to scale. This is exemplified through Hub71 which has seen its startup community grow over the past five years as more startups identify Abu Dhabi as a launchpad for their global expansion.”

The report credited key ecosystem players, including Abu Dhabi Global Market (ADGM), Mubadala Investment Company, ADQ, the Abu Dhabi Investment Office (ADIO), startAD and the Abu Dhabi Department of Economic Development (ADDED), for fostering a supportive regulatory and operational environment.

Incentives such as 100 per cent foreign ownership have attracted significant foreign investment and numerous global headquarters to Abu Dhabi.

Marc Penzel, founder and president of Startup Genome, remarked: “Thanks to the excellent work of Hub71, Abu Dhabi is one of the rare places where everyone comes together to create a world-class startup ecosystem at an incredible pace. Whether it’s digital assets, cleantech, or other fast-growing opportunities, Abu Dhabi should be on the radar of any entrepreneur with outsized global ambitions.”

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