Dubai SME CEO Abdul Baset Al Janani on how Dubai has grown to be a platform for startups, businesses, and SMEs
In conversation with YourStory Gulf Edition, Abdul Baset Al Janani, Dubai SME CEO, talks about the region’s plans for entrepreneurship.
Over the years, Dubai has grown to embrace startups and investors and build a large ecosystem for businesses. Aiding this effort is Dubai SME, an agency of the Department of Economy and Tourism in Dubai, which has taken a series of initiatives to support small and medium-sized enterprises.
Abdul Baset Al Janahi, CEO of Dubai SME, is mandated to promote the small and medium enterprise sector. He has also been contributing significantly to the development and maintenance of the entrepreneurial ecosystem in Dubai and mobilising government and private sector support to help young and aspiring entrepreneurs in the UAE grow into successful business leaders. Under his leadership, more than 13,000 entrepreneurs have been assisted.
Prior to starting Dubai SME, Abdul Baset Al Janahi was a founding member of a number of leading organisations and transformational initiatives in Dubai, including the Dubai Shopping Festival, Dubai Holding (Dubai Internet City) and ASWAQ, a public joint stock Co.
He is also the Vice Chairman and Managing Director of the Mohammad Bin Rashid Fund for SME, a member of the Board of Directors of Tejuri.com L.L.C. (HiDubai), Vice Chairman and board member of Dubai Cultiv8, and a member of UAE Genetic Diseases Association.
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YourStory Gulf (YS Gulf): Tell us how SMEs have grown and evolved in the region.
Abdul Baset Al Janani (ABJ): To understand SMEs in the region and entrepreneurship, it is important to go a little back into history. Before oil was discovered we were traders—trading with India, China, Pakistan, and East African countries.
It was only with the discovery of oil that people started taking employment and getting jobs. This was because people needed to work in oil fields, and the market opened up.
By the 80s, the government realised, while we can create jobs, but how long can that go on? To ensure that there is an inflow of jobs, the private sector needed to be engaged. By the 90s I had joined the government and I was part of the founding team of the Dubai Shopping Festival. It helped build strong government and private sector partnerships.
It was 1999 when His Highness announced the Dubai Internet City at Gitex. We wanted to be a part of the dotcom era by then. But we were a bit late because, by the next year, the dotcom bust happened.
However, momentum had gotten created. We realised that globally there were trends in the internet space. There was momentum still … in terms of building new tech companies, investing, accelerators, incubators …
During that time, someone from Bengaluru came to Dubai saying they wanted to set up a business in the internet city. I remember him wanting to set up the company really fast and go to the Valley. It was interesting to me because he was talking about valuations and funding.
It was then the government thought of accelerating the economy and the growth of homegrown companies. We were instructed to see what were the things that were missing to help startups and entrepreneurs and Emirati businesses.
At that time everyone was moving towards government jobs, and those jobs were limited, and we wanted Emiratis to start up. This led to the birth of Dubai SME; it is a part of Mohammad Bin Rashid's establishment in 2002. I left Dubai Internet City to establish Dubai SME.
We provide access to finance and government procurement and remove all red tape and make establishing businesses as easy as possible. The companies are even exempted from government fees for three years, and, in some cases, we even extend that to five years.
YS Gulf: Tell us about the different things that Dubai SME has been providing for businesses in the region. How are you ensuring stronger entrepreneurship?
ABJ: We established the first incubator, and training and development programme. This was important as entrepreneurship wasn’t something that was common in the region.
While building something from a Ministry of Education standpoint would take time, we decided to simultaneously work with schools and colleges to build programmes and come up with entrepreneurship competitions.
The most important thing that helped the base was access to government contracts. Yearly, we get $1 billion contracts for SMEs. We also provide soft loans for businesses to start their businesses for up to AED 1.5 million to AED 2 million ($272249.6). But the biggest success is the government contracts.
We realised early on that it just isn’t about the capital for startups, but the first contract and building a client base helps. And we have been successful in doing that. We have people like Emirates Airlines and the companies in Dubai that procure from the startups.
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YS Gulf: Tell us more about the incubation initiatives.
ABJ: In 2014, we helped over 7,000 companies and trained more than 20,000 Emiratis. We saw different sectors emerging and picking up. We realised we couldn’t build an army of staff specialised in specific verticals. It was then that we realised we had to work with the private sector; Ztartup, an incubator is one of them, and Astrolabs as well.
We had to enable subject matter experts, accelerators, and venture builders in the city. This is mostly people who are specialised in deep tech and technology, because, as the government, we realise it is not our expertise. But there are people that can be enabled and have easy access. From one or two incubators in the city, in two years, we had over 14 incubators.
This is when we realised that innovation actually starts at the university level, so what can we do on that front? We worked with universities like BITS Pilani Dubai and Amity University in Dubai and built certified incubators on the campuses. While these universities were already doing this in India, they weren’t doing it here; so we supported and helped them so that students can start their businesses right out of college.
We also have the American College of Technology. Today, apart from just doing their courses, students can also start their businesses out of Dubai.
Today, we are also working with schools like Gems Academy where 16- and 17-year-olds build companies. For the schools like Gems Academy, we have created a crowd support platform— Dubai NEXT. These students can start their businesses at school and raise capital too. This is the first for the region.
There are school children that started a cricket platform and have raised AED 17,000 in the crowd support platform. The platform either works on a donation or plan buying model for the products. So people end up buying the product. The reason we chose this is that we didn’t want to get into the complexity of ownership of the businesses.
The overall ecosystem today has home businesses, schools, universities, and licensing businesses. We are the first SME agency in the region that enabled P2P SME financing; we have an AED 1 billion portfolio in that segment.
We have looked at the whole spectrum and worked towards taking all of the startups and businesses to the next level. This includes even subsidies and access to VCs and angels. We also worked towards making more angels so that early-stage investors are there. The platform helps in building portfolios for angels in different ways.
YS Gulf: How has this helped change the mindset of the people of the region and bring a cultural shift towards entrepreneurship?
ABJ: We like to position ourselves as a hub and I think we have grown to become a platform. We have access to India, Egypt, Africa, and Europe.
We have something for every stage of business and startup. For high-growth stage companies who want to have a foothold in the region, and not just Dubai but larger GCC or North Africa, Dubai is like a gateway.
We have built the best infrastructure, biggest ports; Emirates Airlines connects the world. But what helped was how we built a strong differentiator during the pandemic. We were able to come back fast. And businesses that were doing more business with the likes of Singapore, Hong Kong etc., have realised that, during the pandemic, they could do business with Dubai.
While these businesses always knew of Dubai, they didn’t realise the vision until the pandemic. We handled the pandemic with safety and humanity. We definitely can advertise and bring the biggest film stars, and we have done that, but what matters for business people is if they can do business in a region.
We were able to balance business, people, and health. Globally, during the pandemic, there were multiple lockdowns, but Dubai had an extremely strict lockdown for three to six months, and after that, we never needed to lock down. We had multiple restrictions, we knew we are human beings and people needed to step out.
It is important for the economy to evolve, and that is always about the people. This, for the business leaders globally, mattered a lot. So Dubai isn’t just about the hard infrastructure, but also about balancing things.
In fact, 2022 has been the best year real estate-wise for Dubai; we have almost 100% occupancies for office complexes.
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YS Gulf: How have you planned for the volatile market conditions?
ABJ: I have been in this for the past 20 years, and I have seen the 2000 dotcom bust, the 2008 financial crisis, and other meltdowns. In 2008, I was taking a retail company IPO and had to turn that around and even downsize my headcount and the project. It is harder for bigger companies but they do it and it can be done.
The question is who makes the cities move? It is the SMEs. The difference between big companies and small ones is manoeuvrability. It takes time for big companies, SMEs are agile, they can change their business models, and run lean.
We saw that during the pandemic—people in larger companies took time to align and come up with newer ideas, but SMEs were able to transform overnight. This is just one simple example. We have seen enough shocks and know how to be nimble. There are global challenges, and we know that economic conditions are changing.
If Dubai was a closed economy, it could be a disaster, but we are centrally located and have access. Today, trade and business with India are exploding. We are like old Switzerland, we do business and are open to everybody.
YS Gulf: What are the plans for 2023 and what advice would you give for startups?
ABJ: Today, I think a lot of people are reluctant to invest, but should now invest more. It is a good time to realign and invest more. For startups, it is a good time. I advise all startups to keep networking, the ideas and networking ecosystem in Dubai is exploding.
In Dubai, we truly have a melting pot of different cultures and ideas. If you attend events in Dubai, you have newer breed of people. There are people from different regions who think differently. And for startups, that is the most important thing. This is for startups out of India, Africa, and Europe.
Edited by Swetha Kannan