What are the Ways to Raise Funds for Business in UAE

What are the Ways to Raise Funds for Business in UAE

The less-known, but definitely very stressful aspect of starting a business is raising the initial funds for it. Regardless of in which country you are starting your business, getting the seeding capital requires a lot of energy and strategy. If you do not have enough funding to start your startup at the early stage, it becomes difficult to keep the business going throughout. However, this is not the case in the United Arab Emirates. The UAE offers business-friendly and startup-considering environments to all investors and entrepreneurs who are looking for business opportunities.
The UAE provides such policies which ultimately give a boost to venture capital, crowdfunding, bootstrapping, and angel investment.
By providing financial and lawful support to all small businesses and SME business people, and entrepreneurs, the UAE has become the dreamland for the business community.
Talking about raising funds for business in the UAE, there are different ways to do it. In this blog, we have covered all the aspects and ways that can help you raise funding for your next business venture.

The best ways to raise funds for business setup in the UAE

Here are the most successful ways to get funding and capital for your new business in the UAE. For a business set up in Dubai or in other emirates in the UAE, you are required to have funding for your company. You need business investors for your startup in the UAE.

1: Business incubators

Business incubators are incorporations that offer a number of packages and problem-solving solutions to startups without funding them. Rather, the facilities that those organizations offer to prove to be extremely financially helpful.
By providing services in the market positioning, handling the marketing, and funding the other operations, the business incubators help in many ways.
Following are a few known business incubators in the UAE:

  • Hub71
  • In5
  • Turn8
  • Dubai future accelerators
  • Fintech Hive
  • Techstars Dubai
  • DTEC
  • Astrolabs

2: Friends and family

The most feasible yet easiest way to raise funding for your startup is to request it from your family and friends. They can provide the financial support you are looking for.
To convince your family and acquaintances to pitch them your business idea with a proper business plan before requesting financial support.
The potential business owner should prepare a business plan by taking help from an experienced business consultant. The plan must include the problem, its solution, and the need of your business idea. By including demos, prototypes, market analysis, and goals, a business plan can also be presented.

3: Bank loan

Another way you can raise funds and get investment for your business is to apply for loans from UAE banks.
However, it is also a common conception that it is nearly impossible to get loans from banks. As SMEs have to go through a long range of scrutiny criteria to get eligible for a bank loan. The reason behind this is the lack of data and weak strategy and planning.
With all this, there are banks that are offering lucrative business loans to startups at exciting interest rates. By doing some market analysis, you can find such banks that are providing loans with the lowest interest rates in the UAE.
If you have a sufficient credit score, there are banks like first gulf bank, emirates NBD, and HSBC that would offer the business loan.
Talking about the return policy, you have to repay the complete loan within two years of receiving it. And you can apply for a business loan with your trade license, which will be granted by the UAE government to help you launch your startup.
To find the right bank, you have to research a lot. Determine the startup funds that regional and local banks are offering. The UAE government has also been extremely helpful when it comes to helping startups with zero track records. The UAE minister of finance has inaugurated the funding model via the emirates development bank to select and offer funds to deserving entrepreneurs.

4: Crowdfunding in Dubai

Crowdfunding is basically the process of getting sufficient financial support in the form of capital from different influential people who are also looking for financing a project. In simpler words, crowdfunding means when the crowd comes to fund a business. Some of the well-known crowdfunding platforms are Beehive, Eureeca, and Zoomaal.

5: Angel investors

Another way to raise funds in the UAE is angel investment. Angel investors are single capitalists in the business sector who offer investment and in return, ask for an equity share in the business. There is a huge community of angel investors in the UAE. Some of them are the women’s angel investor network, falcon network, Dubai angel investor network, and angel investment scene.

6: Venture capital

The newly rising source of raising funds in the UAE is venture capital. It has been associated with angel investors. Basically, the venture capitalists offer investment for the startup, however, in return, they ask for a minor equity share. The capitalist investors provide capital to entrepreneurs and assist in the launch of small and medium businesses in the UAE.
The help of the capital

7: Local small business development center

The local business development center in Dubai is one of the successful sources of raising funds for your company set up in Dubai. These companies help angel investors get connected to entrepreneurs for networking and angel investing in their businesses. Startups and entrepreneurs for networking with investors who want to support them. The entrepreneur can also get the chance to speak with the local chamber of commerce and business council on guidance for local funding for a company or startup in Dubai or the UAE.

Also read: Step-by-Step Guide to Apply for Business Loan in Dubai

Fund your business in UAE

It is difficult to raise and get funds for your business, whether in Dubai or elsewhere. Here are the less-known, but might be very helpful ways to make things easier.

1: Become a partner with a business person

Becoming a partner with a business person who has already been connected with angel investors can help you network and eventually raise funds. This way, the investors will be more invested in the startup and can offer your experience advice along with financially supporting you.

2: Projects pitch

Pitching your business ideas in front of the investors to intrigue them and introduce them to your venture. There are various events that happen on a regular basis where young entrepreneurs participate and showcase their business ideas to influential people and investors.
This way the investors would not only be evaluating your idea, but they are also looking at your dedication, your planning, and your study about the market.

3: Foreign investment

The UAE companies also offer funding for the company to entrepreneurs via strategic investment. This type of investment works around foreign investors who are trying to set their feet in the business community of the UAE.

The requirement for raising funds for a startup in Dubai

First thing is to have a comprehensive and well-studied business strategy with all the details and information about the new business.
The plan would be long so keep the investors interested by making a specific and people-interacting summary and pitch deck to talk about your business idea.
But do not forget to talk about more complex data including financial information, the next five or ten-year potential growth model, and more. There will be a lot of questions about your research, the need for business, the risks, and precautions to deal with the problems. Be prepared to answer such hardcore questions with logic and data.

Raising funding for your business in the UAE

Getting capital for your business setup in the UAE might seem daunting. But there are ways to reach the right people to get investment for your business in Dubai or UAE.
It is extremely important to work with those people who understand your business, give you the correct advice, connect you with startup hubs, and help you network with many investors who can fund your startup. If during these crucial times, you get poorly advised, it can affect your business a lot.
So, get in touch with Vigor corporate services professional business setup consultants in Dubai and the UAE to have the right people on your side.