According to the Global Entrepreneurship Index 2022, the United Arab Emirates (UAE) was the first place to start a business globally. With world-class infrastructure and accessible financing options, the country is currently home to many startups. Growing up in the region.
While there are several accelerators in the region that bring together startups and investors;In the year Founded in 2021 by Dr. V. John Francis, it is helping startups and entrepreneurs access services such as mentorship programs, training, capital, co-working spaces, and professional assistance.
According to John, who has nearly four decades of experience in technology, management and policy, he wanted to create an ecosystem where entrepreneurs and businesses in the UAE could come together as a thriving community. He wanted to do it in a sector-agnostic way, which led him to start ZtartUp.
“The idea for the incubator came from the context of merging digital and physical brick and mortar and setting up an incubator,” says John.
The group of 15 believes in supporting every innovative business idea that comes its way, regardless of the business institution’s proposal, he says.
Therefore, ZtartUp presents itself as a catalyst for optimizing innovative ideas into commercially viable solutions. It currently has 16 startups under its incubator and accelerator program.
How does it work?
John says: “If you come to us with an idea and want us to support you and you may not have any permits or documents to allow you to leave the UAE. If we believe in your idea, we will offer something called a ‘gut budget’. It can range from approximately $250,000 to a million. Next, we set up a ‘test budget’ that we will lend you if we believe in investing more in your idea.
ZtartUp has a 7% equity stake in the startups that are licensed and commercially viable.
In the past 18 months, four of the startups in the portfolio have crossed the million dollar mark in revenue for 2021-22. In addition, three companies received Golden Visas, which are long-term residency visas that allow foreign talent to live, work or study in the UAE. Through this you can get some special benefits.
“We are currently working in nine sectors, including travel and tourism, artificial intelligence, robotics, sports, film, music and arts, among others. We want to create a dynamic and diverse space,” says John.
As a founder, one of ZtartUp’s unique features is facilitating a team of professionals such as auditors, lawyers, marketing personalities, coders and designers. It gives these professionals a reliable license, which allows them to work on projects inside and outside the enclosure.
“When they bring knowledge of trends in their respective regions to the GCC here, they do it with what’s on the ground. It gives them a platform to interact with like-minded individuals and create a sense of community,” says John.
ZtartUp allows startups in its portfolio to participate in external crowdfunding and accelerator programs.
“Each one is given complete freedom to jump in and pull out. We primarily want startups involved with us to understand what’s happening in the market on a one-to-one basis. Yes, we fund it, but we want them to increase their interest,” says John.
It has joined hands with co-working spaces like LetsWork and WeWork. ZtartUp allows people who book through the apps or are part of these co-working spaces to get exclusive one-row workspaces on ZtartUp.
However, only a select few are accepted. It evaluates companies by seeing whether the applicants fit into the ecosystem or not. Those selected are boarded free of charge for the first three months.
“The idea is to see how they blend in and interact with the rest of the team and analyze if they come with any biases. Once we realize they fit in, we let them into the gaps,” he added.
It currently competes with the likes of DIFC Fintech Hive, Techstars, Hub 71, In5, INNOVEST Middle East.
In addition, ZtartUp also has business centers that are home to Ziqitza Ambulance Service and Safari Ticketing Portal, among others.
“We compete with other business centers because they don’t develop ideas, concepts and processes. Unlike them, we take these startups through the entire process,” says John.
One of ZtartUp’s incubates, Zatram, is licensed to co-exist by the Dubai Department of Economy.
Although the ZstartUp idea took off in early 2020, restrictions imposed by the Covid-19 pandemic have created initial hurdles. Finally, it launched on March 21, 2022.
John said it took some time to become a private company and seek permission from the government. The next task was to make will agnostic. John says that 99% of businesses in the UAE have a Dubai Multi-Commodity Center (DMCC) licence, a Fujairah license or a Sharjah Entrepreneurship Center (SHARA) licence.
“There is a real reason for this. If I apply for Dubai Economy Permit, the starting price will be approximately 30,000 to 35,000 dirhams, while Shera and Fujairah are not that expensive. All emirates have their permits, free zones and main body.
“Expats are taking permits from these zones because it is cheaper. Plus, you don’t have to pay every year or any sponsor. This is what differentiates a mainland license from a free zone license,” he added.
As of now, ZtartUp has a mainland license from the Dubai Department of Economy.
Akshay Jayaprakasan, associate partner at Redseer MEA, highlights that Dubai issued more than 72,000 new business licenses in 2021, a 70% increase compared to 2020.
“Initiatives such as ‘Make it in the Emirates’, cyber security strategy, Industry 4.0 and net zero emissions by 2050 highlight their focus on becoming a business and innovation hub,” he said.
He added, “The UAE is still It will account for more than 50% of the value of PE/VC deals in MENA by 2022, raising $3.5 billion across 180 deals. In the year Over 1/3 of deals in UAW by 2022 led by accelerators/angels/incubators. In addition, the Golden Visa, Green Visa and Quality of Life are attracting talent from around the world to the region.
Dubai also has the most favorable trade regulations, according to a World Bank report. “In the past two years, investor interest in the region has picked up and varied across regions and sectors,” says Sandeep Ganediwala, partner, RedSear.
ZtartUp received investment from angel investors.
The company is expanding its base to Kochi in Kerala, India and has joined Kerala Startup Mission, Tamil Nadu Startup Mission and India Startup Mission.
John explains, “We are planning to limit ourselves to South India for the time being for logistical reasons.
ZtartUp plans to open a center in Singapore. In addition, the team is working to create a succession of team leaders so that it can explore other markets.
(By Sindhu Kashyap, Lead Editor, Global Initiatives Submissions.)
(Disclaimer: This story has been edited to remove incorrect names of some investors)