Global عربي
KSA عربي
Global عربي
AI, the future of everything, isn’t a future thing any more, it’s among the fastest-growing sectors of the global economy currently. And it’s also among the only countries with a very concrete, clear and detailed AI adoption plan, guiding where it will grow in the long term. With its National Artificial Intelligence Strategy 2031, the UAE is covering the road towards a world leadership in AI by fueling AI research, development and entrepreneurship.
Abu Dhabi’s AI companies jumped 67% from mid-2024 to mid-2025 with the total number of AI companies reaching around 700. That’s why the UAE isn’t just preparing for what’s next, they’re already there.
So even with 90,000 AI companies worldwide, Abu Dhabi’s roughly 1% is small, but impressive for a city and population of its size. It emphasizes how these countries intelligent on the ground investment and national strategy mixed with public-private partnerships generated the UAE’s emergence as one of the region’s most active AI hubs.
Both UAE Investors and Businessmen see AI opportunities in the country’s Medical Testing, Energy Forecasting, Smart City Systems and Finance Tech Accelerating but each one of these concepts needs time to grow into a legitimate business.
One start-up founder shared that just applying for and getting capital from government grants took twice as long, mainly because of the paperwork and trying to fit into national priorities. With funding approved, the support opened doors to mentoring, regulatory guidance and partnerships that would have been impossible to assess without the government push.
The funding scene in UAE is complicated at first glance. There are government grants, R&D incentives, incubators, accelerators, each with its own focus point, application process and rules. A ton of start-ups couldn’t figure out what one of the government-supported they could get and the investors want credible solutions help businesses gain from strong government support.
As a side effect, this fast growth is dangerous in itself. But most start-ups don’t know which programs target them because the criteria are either unclear or not available.
If the deadlines are hard and the work is complex, even the greatest suggestions can fall through the gaps. As an investor, it's the fine line between funding a startup that has the potential to make it big with the right support and one that never takes off due to failing to get a big enough round in time.
Read more about: What Are The Required Documents to Start an AI Business in the UAE?
AI R&D grants and incentives are financial or practical support for companies in AI. It also plans to make it easier for startups to actually construct and test their AI concepts. Such supports could be cash grants, legal office space, tax incentives, mentorship or access to government projects.
In the UAE, this backing is led by entities including government initiatives, national AI offices, and free zones and specialized.
Take, for example, Abu Dhabi AED 2 billion Innovation Program that backs programs across areas like AI, advanced tech and sustainability. These types of investments show the UAE’s commitment to AI in Action, as an economic pillar.
Not all assistance comes in the form of cash. Other programs have an in-kind incentive, or assistance with services or facilities rather than cash. T
ake, Abu Dhabi’s Hub71, who’s Access Program offers an office along with accommodation and health insurance and startup credits. Based on the start-up phase, a few packages may be up to AED 500,000+. It also provides founders the flexibility to focus on the product rather than the minimum viable expense.
Similarly, DFA links startups with the government on the ground to pilot and test their AI solutions in the wild. That’s a major non-financial value in itself because it gets start-ups early customers and attention.
For AI-focused startups, the UAE incentives usually falls into three categories.
1-Grants and Funding Programs
These are direct funding to startups/SMEs to carry out R&D or trial projects. Among them are ADIO Innovation Grants, and Khalifa Fund that tend to fund innovation and business growth.
2- Accelerator and Incubator Programs:
Accelerators like In5, Hub71 and DFA offer startups mentorship, workspace and investor connections. This lets them expand rapidly while reducing the costs.
3- Tax and Licensing Incentives
Many of the UAE’s free zones and innovation hubs offer AI-focused companies having an easier licensing process, 100% foreign ownership and reduced setup fees. These are the side-benefits that encourage the UAE into an innovative entrepreneurial environment.
All together, these supports build a solid base that allows startups to test their ideas, grow their teams and find funding without huge up-front overhead.
4- Focus on R&D Activities
Most of the AI grants in the UAE are associated with Research and Development (R&D). This means the funding can utilize it on things like testing algorithms and developing or improving the prototype and AI models.
These programs also frequently expect startups to progress, provide clear results and sometimes generate employment in local areas.
Such as, the Khalifa Fund for Enterprise Development support SMEs that can demonstrate they’re an innovative and drive the UAE economy to grow. Or, the startups who either have strong innovation potential or hire local talent would higher chances to receive seed money.
Read more about: Can Foreigners Fully Own an AI Company in the UAE?
The eligibility criteria varies by programs but there are a lot of common across various UAE funders and hubs. The point is that when the entrepreneurs know about these common rules will make it easier to prepare the application and clear the first screening.
Nearly all grant programs request for a legal entity that was registered either on the UAE mainland or a free zone. Some funds will accept applications before the company formation but they want the startups to register before they disperse the funds.
For example, ADGM tech and associated licenses require applicants to follow the local eligibility rules and sometimes they can request to provide letters of authorization from ecosystem partners. This mean founders must research the exact registration rules early.
Most of UAE grants are given to those startups that matches the goals of UAE in the field of AI and its Emirate mission in healthcare innovation, energy conservation, Smart City development, Arabic Language solutions.
So startups aligned with these national goals today are going to do better, because their metrics are seen as progressing the country’s broader policy direction.
Most of the UAE programs publish a list of challenge or focus areas annually, so that the entrepreneurs smartly connecting the pitch to these areas of challenges. The UAE programs always demonstrated that your startup’s work is being directly applied in the broader UAE’s long-term AI vision.
Many of the startup funding in the UAE is inclined towards those who want to build out the local economy through creating local jobs, hiring Emirati talent and partnering up with local companies. Some grants also have In-Country Value (ICV) criteria where they need the entrepreneurs to demonstrate how much impact they will have on the UAE’s economy.
When applying for AI R&D grants, startups usually have to show the financial health of their business through documents like owners IDs, bank statements, basic balance sheets or a cash-flow forecast and a detailed budget of the grant.
This is what funders want to see that gives them confidence that the startup founder knows how to manage its finances and can responsibly manage the grant.
Some of the cohort, they will verify your company’s turnover or recent bank statement, while other will look at pre-revenue early stage startups with a compelling technical argument. It’s transparent, realistic budget and spending forecasts makes investors confident that the startup spend funds wisely and reach its milestones.
One key factor in securing AI R&D support is a strong technical team. The grant providers want to see some proof that you are actually able to do what you saying, in the form of code samples, working prototypes, published papers, or even piloting.
But if a startup is lacking in deep technical expertise, they can do collaboration with a university or research centre to take the guidance and strengthen the proposal.
The programs also do due diligence on applicants before funding so that they can check they are legit licensed people. This makes the business legally recognized in the UAE and fully compliant with all industry standards.
For example, AI startups in fintech and healthcare would need to be assessed in advance by regulators such as ADGM or health officials prior to piloting. But that compliance has to be upfront, so startups aren’t blocked, and can bootstrap themselves from funding to project plans without a worry.
The UAE AI Office implements the national AI agenda under the National Artificial Intelligence Strategy 2031 to position the UAE as a global AI leader by 2031.
It’s all part of a broader plan to harness AI to expand its share of the country’s GDP from roughly 9% currently to up to 45% by 2031. This would add nearly AED 335 billion to the economy. This strategy will set out eight objectives like applying AI in the public sector and increasing research capacity, educating local talent and providing infrastructure.
Since the AI Office determines national priorities, many funding programs and incentives have also been related to the AI Office’s priorities.
The startups who have focus on areas like health care, energy and the smart city would have a better chance to get funding. The AI office also works with other ministries to introduce AI-supportive policies and to join together strong ties between government, investors and innovators, creating an ecosystem for AI innovation across the UAE.
Read more about: What Is The 2031 UAE National AI Strategy ?
It is Dubai based initiative that offers support to startups and innovators to back tech, design and media start-ups. Since 2013, the In5 has supported more than 500 startups and entrepreneurs with workspaces, mentors and a vibrant entrepreneurial community.
They also provides startup accelerator stage for founders to test ideas, get mentor feedback and tell stories at the launch pad to Dubai tech community, while In5 doesn’t provide huge capital funding, its co-working spaces and early-stage-exposure helps startups to save early cost.
The In5 membership also enhances a startup's credibility when applying for other grants or accelerator programs, as it earned recognition from an esteemed UAE innovation hub.
This centre is located in a strategic part of UAE. It is based in Abu Dhabi Global Market (ADGM) and is one of the UAE’s leading innovation and funding hubs for tech and AI startups. It’s launched under Ghadan 21 to encourage entrepreneurship and broaden the economy’s base.
It offers an Access Program that gives startup a mixture of in-kind, capital funding and other support including covering housing, office space and health insurance to help startup focus on their product development.
Startups also get assigned investors, mentors and government partners to fast-track their growth. Since Hub71 is located in ADGM, startups can get additional benefits from the Tech Startup Licence for early-stage tech companies.
The program of Dubai Future Accelerators (DFA) is initiated by the Dubai Future Foundation and connects startups with government and private sectors to solve real-world urban challenges.
This program run a 9 week phase’s where selected startups collaborate with government partners to prototype and endorse solutions.
Unlike most accelerators, DFA won’t take equity in startups for participation, making it attractive for founders. Instead, it gives amazing access to government partners, customers and experimental projects to try products for startups.
From research to deployment, DFA is a vital non-dilutive support program, providing AI startups the room to experiment, collect feedback and demonstrate real-world need.
- Khalifa Fund for Enterprise Development: It is a government backed agency that provide support to SMEs in UAE. It provides investment and backup along with mentoring, training and ecosystem access locally and regionally.
It has been launched in 2016 and the fund has supported over 1,200 SMEs, financed over AED 1.3 billion and created more than 15,000 jobs.
While not all of these programs are AI-focused, but the Khalifa Fund has backed dozens of new tech-driven solutions. Startups don’t get any direct funding, but the fund assists, with training, fee waivers and market access.
- ADGM/ Innovation Grants and MBRIF: ADGM unlocks capital and partnerships for startups of innovation. One of its most significant strategic investments tied directly to ADGM is Muhammad Bin Rashid Innovation Fund (MBRIF).
The UAE government had signed an MOU with ADGM and disbursed AED 2 billion fund for innovation. It also allows MBRIF to assist start-ups in obtaining loan and investment guarantees.
ADGM goes even further in cutting costs for innovative start-ups, like AI and Fintech, by offering the Tech Startup Licence. With MBRIF’s funding programs, ADGM’s startup incentives and Hub71’s accelerator initiatives, Abu Dhabi has its own comprehensive ecosystem that support AI startups from inception to international expansion.
The DFA connects startups with Dubai government organization in order to help them solve real-world problems.
In the 5th cohort, nearly 40 UAE and global startups participated in the program. They engaged 12 government’s entities, working on projects relevant to their own industries.
During the nine week program, around 65% of these startups had signed agreements with partner public organizations and had begun longer term work with partners.
For its 7th cohort, DFA received 688 applications from startups and scale-ups across the globe, which means it’s really taking off, gaining trust from the innovation community.
Only a few were selected to work on challenges developed by partners like the Roads & Transport Authority, Dubai Police, and Dubai Electricity & Water Authority.
Through mentors, workshops, and access to decision-makers, DFA assists early-stage startups in transforming their ideas into market-tested solutions.
In5 Innovation Centers, which opened in 2013, have become one of the most active startup incubators in Dubai. Since its launch, In5 has incubated 1,000+ startups in the technology, media, design and science sectors. Startups in In5’s ecosystem have raised over AED 7.8 billion in investments, grants and partnerships.
In5 has various programs so that different startups can get assistance with their various needs. The Science program back startups working in life sciences, energy and environment.
It links developers from different founding companies to lab and research networks and other industry peers. In5 assists in the business setup, provides work space in labs or co-working spaces, mentorship and workshops, connects founders with investors, and sometimes can help arrange visibility events for investors.
Hub71 is Abu Dhabi’s global startup accelerator and tech hub offering each service, a startup needs to succeed on a global scale.
It backs founders in deep tech like AI, fintech and climate tech. Now in its 17th cohort, Hub71 accepted 26 AI-focused startups that raised about USD 223 Million (approx. AED 818 Millions), underscoring Abu Dhabi’s investor confidence in its innovation ecosystem.
In the 16th cohort, the entrepreneurs witnessed the worldwide impact of Hub71, with 63% of chosen startups (27 ventures) originating outside of the UAE.
These startups collectively raised USD 145 million (AED 532 million) in funding. Hub71 also has access to tech infrastructure and knowledge resources, for example, Hub71+ AI and Hub71+ digital assets, provides personalized support to the founders, offering them infrastructure access. With this approach, Hub71 links early stage founders with globally connected investors and regulators in regulating nations.
ADGM facilitates new business under its Tech Startup License, enabling firms to establish and operate within a flexible but well-regulated ecosystem.
The license is divided into two levels, the Seed Stage is for very early companies (1-10 employee startups under three years old) and the Emergent Stage for slightly larger companies with up to (50 employees and less than five years old).
Due to lower fees, startups can benefit from reduced license fees and lowers the barrier to entry, making it easier for entrepreneurs to get off the ground. Such as; Seed-stage startups pay around AED 3,650 a year for up to 2 years, and emergent-stage startups pay around AED 15,800 a year for up to 3 years.
ADGM also offers access to co-working spaces, business support and visa sponsorship with the office desk space. They may also get access to Hub71 ecosystem including possible subsidizes on housing, office space and employee healthcare for ADGM startups. All this combined makes ADGM a highly attractive path for local and foreign startups who want to set up in the UAE.
There are four main steps to applying to an accelerator/incubator or grant in the UAE: preparation, submission, evaluation and onboarding.
- Preparation: Start-ups collect information including a business plan, pitch deck, technology summary and company details. This stage is important as each program, either Hub71, Dubai Future Accelerators, or ADGM, has its own rules and deadlines. It's better to get these rules known at the beginning in the long run to save yourself time.
- Submission: Once the papers are prepared, you go ahead and file them up for consideration. Most programs contain online forms for founders where they will be required to upload all of their files before the deadline. Many projects are operated on cohorts, therefore applications are reviewed systematically in groups. If you lose your round you usually go to the next cycle.
- Evaluation: Once submitted the evaluation begins. Teams from the accelerator or the funders look at applications, shortlist people and invite the selected startups for interviews or the pitch.
- Onboarding: If a startup passes evaluation, they begin the onboarding process. Accepted teams receive assistance with organizing their legal entity and with business licenses and visa requirements, if applicable.
Programs like Hub71 are also helping new founders to join the ecosystem as well, providing them with mentors, partners and investors. For example, the Hub71 Access Program examines and approves applications in approximately three months, allowing startups to prepare before entry, or entry into the program.
- Timeline: The timeline for most UAE programs is also variable depending on competition and regulation. On average, it takes three to six months from the time an application is made by a startup until it officially joins a program.
Some accelerators generate quicker results, in two to three months. Government grants can take longer due to compliance checks and completing the approval of grants. Most programs that collaborate with public partners, such as Dubai Future Accelerators, frequently extend the reviewing requirement to align with the government's schedule.
To make the process easier, the startups should apply early and keep track of all the communication from program coordinators. The provision of fully detailed and accurate information minimizes delays, particularly when assessing claims.
By being meticulously wise and by following the published timelines on the websites of the relevant organizations, founders will be able to get a better chance at being selected and jumpstart themselves off to a good start within the growing AI scene in UAE.
In addition to government grants and accelerator programs, many companies in the UAE receive funding from private investors and venture capital firms.
These investors lend money to the company in exchange for some part of the company. Among the UAE’s most prominent investment firms are those that specialize in startups working in artificial intelligence, clean energy and financial technology.
These firms generally invest during the early stage of growth, and offer both support and business connections to help startups grow.
Some investment groups based in Abu Dhabi have also launched dedicated AI and deep tech funds.
For instance, one of those funds was introduced with a goal to invest about USD100 million in companies focused on artificial intelligence, data analytics and machine learning.
These types of funds typically aim to promote innovation that supports national goals and priorities, such as AI Strategy 2031 of the UAE and economic diversification strategies.
Another new funding avenue is digital investment platforms which connect startups directly with investors.
These are those forums where entrepreneurs can submit and post their startup ideas and funding needs, while investors can check all the startups and choose one of the startups for funding. The model also helps startups in gaining exposure to a wider base of potential backers instead of a single investor or VC firm.
On such a platform investors can put in small or large sums depending on their interest and budget.
The funds can be used by a startup business for their operations, research or expansion. These sites will usually do background and risk assessments before a startup is listed, allowing both parties to decide together. In the UAE, these regulated platforms have been picking up for the simple fact that they provide a formal investment mechanism behind small firms and promising start-ups.
A number of large UAE companies are also investing in startups through their corporate venture arms. These are divisions of established companies that invest in start-ups that work on solutions that are relevant to their business sectors.
For instance, a telecom company can invest in an AI startup making network more efficient or the energy company can invest in startups working on smart grid technologies.
This kind of funding usually exceeds monetary support. Startups gain market access in terms of actual market data, testing environments, and access to customer networks. In return, early access to new technologies is provided to corporate investors. This type of industry partner model is also beneficial to startups as it will allow them to scale quicker while keeping innovation in line with local industry needs.
Apart from equity funding, a few startups opt for debt or revenue based funding to raise money instead of giving up ownership.
In this model, startups borrow the money and pay it back over time with a part of their monthly revenue. This later-stage approach is becoming more popular with UAE companies as it provides flexibility and avoids premature dilution ownership.
A few marketplaces and niche digital lenders provide such capital to firms with a consistent cash flow or rapid growth potential.
These lenders often leverage technology to assess risk and to determine repayment schedules. For startups with few assets but with predictable revenue, this type of financing can be an affordable substitute for traditional bank debt.
In many situations, new enterprises in the UAE use a combination of various funding methods to suit their requirements.
For example, a company may begin with a small investment via a digital funding platform, and they may then join an accelerator program and eventually an investment in the form of corporate or venture capital funding.
Combining all of these sources helps these startups remain financially stable and gain the creditability of the larger investors.
This mixed approach gives flexibility as well. It provides flexibility for founders in managing ownership effectively, provides longer-term financing to meet short-term funding needs and allows for alignment with public and private sector programs which promote innovation.
This mix of funding layers is being adopted by tech start-ups in the UAE more and more, especially in the AI and digital transformation space.
1. Can I combine multiple funding sources for my AI startup?
Yes, you can leverage different funding paths to establish an AI startup in the UAE, but should pay attention to each program’s regulations. Many founders utilizes different government grants, accelerator support, then attract private investors to grow.
For instance, a startup can be awarded an innovation grant from a program like Hub71 or Khalifa Fund and then have seed capital invested by a local or international investor afterwards.
This kind of combination allows startups to stream back and forth between development and commercialization fluidly without being bound to lock into one or the other.
However, before you join any program, you must read the terms. Some government grants also ask that you disclose all the support program your company has already received from third parties, like investors or incubators.
When an entrepreneur show transparency and honesty, it goes a long way toward granting and earning the confidence of donors and investors. By using multiple sources to fund your startup, you show that you’re resourceful and you build credibility with UAE organizations.
2. Can foreign entrepreneurs apply for UAE AI funding?
Yes, many UAE AI grants and programs are open for foreign entrepreneurs. The UAE embraces the world to build local skills and localize global talent Innovations programs including Hub71, Dubai Future Accelerators, and ADGM Tech Startup License allow overseas founders to submit an application. If the founder has a law office in the UAE, they offer visa support, office space and fund.
However, some grants, particularly those from the government or Emirati (as in the case of the funds only for SMEs like the Khalifa Fund), may require a percentage of the company to be owned in the UAE or the company to be registered in the UAE.
Therefore, you may become eligible if you start a local business, even if located in a free zone with ADGM or Dubai Internet City. Many international founders do this because they wish to maintain long-term access to the UAE AI ecosystem.
3. Can I get funding if my AI solution is in an early prototype stage?
Yes, early stage AI startups can get funded, especially if the idea fits with UAE AI objectives or shows market potential. The Incubators like In5 Innovation Centers and Dubai Future Accelerators take on prototype startups.
They offer mentorship, technology facilities and networking, instead of cash grants on large scale. This allows founders to refine their solutions prior to the receipt of larger investment.
Government funds and private investors usually want proof of concept, but they know that innovation starts by testing.
The more crucial areas it covers like healthcare, energy, finance, or sustainability, the more interest you will attract if your prototype is working in those areas. Anything that clearly shows that you researched, tested, and how you can grow will help you stand out in the crowd.
4. How much funding can I expect from government grants or accelerators?
It depends on the program and the stage of the startup. Some accelerators provide between AED 250,000 and AED 500,000 of accelerator funding based on non-dilutive terms. That support can be in the form of housing, office, and health coverage.
Other funds, such as the Khalifa Fund or the Mohammed bin Rashid Innovation Fund, provide funding ranging from AED 100,000 to several million dirhams, depending on the project's size and the level of innovation.
Often the help involves more than money; the founders also receive mentorship, help with regulation and opportunities to partner.
To secure funding, emphasize how your project fits within UAE AI strategy and has specific economic or social benefits. Startups that are in national priorities or who have worked with government agencies get better consideration and more funding as well.
Disclamer:
This post is for educational purposes only, and does not constitute investment advice or a solicitation to take any financial action. It should not be relied upon when making investment or financing decisions.
