Funding sources for startups in the UAE

By Sawsan Alsharanee Alsharanee AccessTimeIcon

Ranked as the top destination for entrepreneurship in 2022, the United Arab Emirates is a leading hub for startups and entrepreneurism, with business-friendly legislation, tax incentives, and endless funding sources for startups.

If you are an entrepreneur interested in business setup in Dubai, UAE, or gearing up for your business setup in Sharjah, keep on reading to learn about the most popular funding sources available to startups in the UAE and how they can help you grow your business.

Why start up your business in Sharjah?

Funding sources in the UAE

1. Crowdfunding

Crowdfunding basically means funding a project by raising money from many people through licensed online platforms. 

There are several types of crowdfunding:

  • Donations model: in the type funders donate money for a cause while not expecting any returns for their grants.
  • Rewards model where funds are asked for in exchange for a future reward.
  • Crowd-sourced equity funding (CSEF) where the investors provide funds in exchange for receiving shares in a company.
  • Debt or peer-to-peer lending model where a lender provides a loan and expects it to be paid back with interest at an agreed rate, or a rate fixed by the crowdsourcing platform.

Some examples of crowdfunding platforms in the UAE:

2. Bank loans

Although getting a bank loan in UAE is far from a simple procedure, given the list of requirements and criteria which include strict credit conditions, collateral, and high demands on your credit score, this option is still a great way to fund your startup business, especially with the lucrative interest rates that banks offer.  

You need a valid trade license to apply for the bank loan, which you’re required to pay back within 2 to 24 months.

Many local banks operate startup funds that are initiated by the ministry of finance and given to selected recipients through the Emirates Development Bank.

Let us help you open your corporate bank account.

3. Angel investors

Angel investors, also known as informal investors, seed investors, or business angels, are entrepreneurs or firms willing to support promising startups with funds while getting ownership equity or convertible debt in return.

Angel investors are usually the first round of funding for a startup. This type of lending is more focused on helping startups take their first steps, rather than the possible profit they may get from the business, making it a more favorable option for businesses in their early stages.

Some of the main Angel investors in the UAE are:

  • Angel Network Middle East
  • Dubai Angel investors
  • Womena
  • Falcon network

4. Venture Capitalist (VC)

A venture capitalist (VC) is a private investor that provides capital to companies with high growth potential in exchange for an equity stake.

In comparison to Angel Investors, Venture Capitalists usually have stricter funding conditions and take longer to make investment decisions, putting in higher amounts of funds in return for higher ownership equity of companies and a more active role in their management.

Although Venture Capitalists in Dubai are a funding option for startups of all sizes, this type of investors usually prefers to invest in later-stage companies that show higher prospects for profits.

Use our cost calculator to know the accurate cost of your business.

5. Business Incubators

Business incubators are programs created and run by governments, startup organizations, or successful entrepreneurs, dedicated to helping startups develop and grow at a lower cost in the early stages of their business incubation.

 Business incubators are designed to equip companies in their beginnings with the knowledge and tools to stand on their own by providing office spaces, administrative functions, mentorship, and access to investors and capital to help them achieve a minimum viable product (MVP) and create a well-built plan to take that product to markets.

In return for their services, incubators either charge a fee or take it as an equity stake in the startup, and their period can last from a few months to several years.

Frequently Asked Questions about funding resources in the UAE

How can I get funding for startup in UAE?

Crowdfunding, bank loans, angel investors, venture capitalists and business incubators are some key sources where you can seek business funding when you set up your business in the UAE.

What is the best source for funding a startup?

When it comes to funding a startup there is no one funding source that fits all. The best source of funding for a startup depends on various factors, including the stage of the business, the amount of capital required, the industry, and the goals of the founders. Ultimately, the best source of funding for your startup will depend on your unique circumstances and goals. It’s important to thoroughly research and evaluate each option to determine which one is the right fit for your business.

Is UAE good for startups?

The UAE has made significant strides in recent years to become a hub for startups. With a strong economy, an abundance of resources, and a thriving business environment, the UAE is becoming an increasingly attractive destination for entrepreneurs looking to start their own businesses. Business setup in Sharjah has also grown due to the conducive government policies, focus on innovation and technology and access to two airports and a seaport. This means that there are plenty of opportunities for startups in sectors such as e-commerce, fintech, and logistics.

Which sector is booming in UAE?

There were several sectors that are experiencing growth and expansion in the UAE. Being a booming economy and a world-class tourism destination, there are a host of businesses that thrive in the UAE. Some of these include technology, finance, entertainment and recreation, healthcare, and ecommerce to name a few.

Is UAE investor friendly?

The UAE government has taken significant steps towards creating a business-friendly environment that is attractive to investors from around the world. The country has established itself as a global business hub and is known for its infrastructure, tax incentives, and ease of doing business.

The UAE has a favourable legal and regulatory framework that supports foreign investment. The government has established a range of free zones and economic clusters that offer investors tax exemptions, customs duty exemptions, 100% foreign ownership, and other incentives. The country also has a well-developed legal system that protects the rights of investors and ensures that disputes are resolved quickly and efficiently. Furthermore, significant investments have been made in sectors like infrastructure, including transportation, telecommunications, and utilities, which make it an attractive destination for investors.

Why set up your startup business with SPC Free Zone?

Conveniently located in the heart of Sharjah, the SPC Free Zone is a one-stop-shop free zone, established in 2017, and provides a variety of business setup services and state-of-the-art infrastructural amenities, including coworking spaces, office space, warehouses, and retail stores, all within a business-friendly regulatory framework.

SPC Free Zone promotes entrepreneurship and offers business support services, including 100% foreign ownership with zero paid-up capital and exemptions of income and corporate taxes.

Whether you need a general trading or e-commerce license in UAE, we offer more than 1,500 commercial activities. Additionally, you can apply for a dual-licensing option that provides mainland and free zone on the same license and up to 20 visas under that license. Furthermore, the on-site immigration services allow you to get your license in just 45 minutes, and your UAE residency visa in 5 working days.

Contact SPC Free Zone for help with your business setup in the UAE today!


The information contained in this website is for informational purposes only and should not be construed as legal advice on any subject matter.

You should not act or refrain from acting on the basis of any content in this website without seeking independent legal or other appropriate advice. The content of this website contains general information and may not reflect current legal developments or address your situation. SPC Free Zone disclaims any and all liability for actions which you take or fail to take based on any of the content contained in this website.

The operation of this website does not create a professional relationship between you and SPC Free Zone.


Bring your business vision to life.