How to Fund your Entrepreneurial Startup in the UAE

• Family and Friends

The simplest strategy to get financial support is by requesting your friends and family for financial assistance. But asking your friends and family for financial help can feel intimidating. Your business plan should be completed before you request money from your family and friends. 

With the help of your prepared business plan, you must explain your business ideas, and   plans, what your startup has to offer, and how you plan on making this a successful venture. You can also present any demo, projected sales, prototype, financial plan, competitors, and risk considerations. 

• Crowdfunding in UAE

Crowdfunding, as the term suggests, is when the “crowd” “funds” a startup. Crowdfunding can help entrepreneurial startups obtain a moderate amount of financial contributions from a large number of people to finance a startup. 

In this funding technique, family, friends, and investors together contribute money to raise money. This is usually done through social media and crowdfunding websites. This can help you to take advantage of their networks to gain more exposure. 

Some of the common crowdfunding platforms since 2010 are:

• Zoomaal

 Zoomaal is one of the top-rated crowdfunding platforms for creative enterprises such as artists, filmmakers, and writers in the Arab world. You have to showcase your plan and financial proposal to a supportive audience who are willing to provide you with the money you need. 

Supporters donate how much they wish to the startups they find interesting and appealing. The founder then returns this gesture by offering them rewards in exchange for their contribution. 

The steps to do this are quite simple. After you submit your startup idea, you have to start a campaign that consists of a brief biography, a description, a video, and reward options. Your business concept is reviewed by the Zoomaal staff before it is posted onto their website. 

• Beehive

This platform was the UAE’s first crowdfunding platform. On this platform, you can directly contact the investors who are ready to fund your startup. Beehive eliminates the need for a traditional middleman. 

• Eureeca

Eureeca is one of the first well-known equity crowdfunding platforms in the UAE. In exchange for access to funding, members of the investor networks purchase shares. 

This is famous among investors who want to put money into new and modern startups. If the startup you have funded decides to distribute its earnings, you get a share in the form of dividends or other payments. 

• Business Incubators

These are organizations that provide facilities and packages for entrepreneurs and startups. They do not provide funding but do not worry, because the facilities and packages can be a financial advantage for new businesses. They provide full-service support to new startups ranging from market positioning to marketing and funding for company operations. 

Some of the business incubators in the UAE include:

• Astrolabs
• Turn8
• Hub71
• Techstars Dubai
• DTEC or The Dubai Technology Entrepreneur Centre
• FinTech Hive
• In5
• Dubai Future Accelerators

• Angel Investors in the UAE

Another option for funding your entrepreneurial startup is angel investors. They often act as lone venture capitalists. Angel investors focus mainly on your relationship with them rather than the cold facts, this helps new entrepreneurial startups to feel at ease. 

There are many angel investment networks out there in the United Arab Emirates such as Emirates Angels where you can connect with many angel investors who might be interested in your business plans, ideas or startup. 

• Bank Loans

Getting a loan from the bank is not given much importance. A common misconception surrounding this is that people believe that it is difficult to get a loan from the bank for startups. People assume this because SMEs have to go through many obstacles before they convince the banks that they are a serious and legit company and that they will repay the money they have borrowed. 

Banks provide loans at profitable interest rates. This is done to draw in new clients so they frequently compete with other banks to provide the lowest interest rates. 

Your entrepreneurial startup can get bank loans if your credit score is almost perfect, and the credit requirements are strict. You will need to put up some collateral. Some popular banks that offer loans are:

• Emirates NBD
• HSBC
• First Gulf Bank

To apply for a business loan from any of the banks, you will need to have a business trade license with you. And you must repay the loan within two to twenty-four months. 

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