Why global VCs are turning their attention to Dubai International Financial Centre

Venture Capital

In 2021, the UAE ranked top in the MENA region for venture capital (VC) deals and funding by Magnitt. Overall, UAE-based startups raised USD 1.2bn, a year-on-year increase in deal activity of 12%.

The emirate of Dubai leads the way in terms of UAE investment and innovation. According to financial platform Finom’s global index, Dubai ranks in the top 35 most attractive cities in the world for attracting VC investment, creating a dynamic, high-growth environment for ambitious startups and investors alike.

Staff Writer

Published: 21/02/2022

3 min read

Ideally positioned between the major time zones of leading international financial centres in London and New York in the west and Hong Kong and Tokyo in the east, Dubai is the perfect location from which to do international business. In addition to being located within a five-hour flight of 2.2 billion people, Dubai also offers outstanding state-of-the-art digital infrastructure, including logistics access to the Middle East’s largest trans-shipment hub, Jebel Ali port, and Dubai airport. For innovative companies, this provides the foundation to take their business global.

Within the Dubai, Dubai International Financial Centre (DIFC) is home to over 1,000 financial and innovation firms, more than all the other GCC countries combined. A world-class financial ecosystem and centre of financial growth, DIFC has a total market size of over USD 424 billion, equivalent to 30% of the GCC’s combined GDP and contributing over 10% of Dubai’s GDP.

The Centre has attracted 17 of the world’s top 20 banks, six of the top 10 asset managers, three of the top five global insurance companies and eight of the 10 leading global law firms.


A world-class investment prospect

DIFC provides world-leading support for startups across all industries, with a sector-agnostic approach to innovation. Its vibrant ecosystem hosts more than 38,000 professionals in over 3,600 registered firms.

These professionals enjoy an environment designed to nurture innovation and collaboration. DIFC offers an abundance of educational, networking and funding opportunities. Events such as 2021’s Blockchain Week enable knowledge-sharing and engagement around the most relevant emerging industry trends. The DIFC’s common law framework also provides a flexible and robust foundation for innovation.

Home to more than 500 technology firms, DIFC’s dedicated Innovation Hub offers investors as well as founders dedicated space from USD 500 per month. Investors and entrepreneurs enjoy all the benefits of a financial free zone, including top talent, an empowering ecosystem, 0% tax rate and 100% foreign ownership, meaning there is no better place to do business.

This environment is abundant in startups and scaleups and rich in opportunity for ambitious VCs.

Designed for success

The Centre is overseen by progressive, innovation-friendly institutions. The DIFC Authority provides an independent legal framework and world-class business infrastructure, and the Dubai Financial Services Authority (DFSA) establishes supportive regulation. DIFC Courts operate an independent English-language common law judiciary system, making it easy for international investors and businesses to bring their operations to the emirate.

For VCs, DIFC offers the simplest and quickest route to establishing a fund in the UAE. Its process is fully digital and automated, with a one-week turnaround time and no regulatory capital requirement. DIFC provides a uniquely enabling environment for VCs, waiving required functions to streamline fund setup and DIFC ROC commercial license fees for the first two years, subsidising regulatory costs by over 60%. This frictionless process fast-tracks VCs to success.

Investors also have access to the AED 1 billion Future District Fund. Established in 2020, the fund is designed to nurture the future of finance and startups of the future economy. It aims to deploy half of its investments into venture capital funds with a local focus and the other half directly into startups, with the mandate to accelerate regional innovation, representing a huge opportunity for VCs.

DIFC’s combination of innovative spirit, robust and supportive infrastructure and financial force make it a world-class prospect for innovators and investors alike. For international VCs, DIFC offers unparalleled opportunities in one of the region’s most dynamic ecosystems.

To find out more about how DIFC is providing world-class opportunities for VCs, click here.