Venture Debt - United Arab Emirates

  • United Arab Emirates
  • The United Arab Emirates is expected to see the Total Capital Raised in the Venture Debt market market reach €24.70m in 2025.
  • Traditional Venture Debt is the dominant player in the market, with a projected market volume of €24.05m in 2025.
  • When compared globally, the United States is set to generate the most Capital Raised, reaching €25,360.0m in 2025.
  • In the United Arab Emirates, Venture Debt is gaining traction as a strategic capital-raising option for tech startups in a growing entrepreneurial ecosystem.

Key regions: Brazil, Germany, United Kingdom, Singapore, China

 
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Analyst Opinion

The Venture Debt market within the Traditional Capital Raising landscape in the United Arab Emirates is witnessing mild growth, influenced by factors such as cautious investor sentiment, evolving startup ecosystems, and the increasing need for flexible financing solutions among emerging businesses.

Customer preferences:
Investors in the UAE's Venture Debt market are increasingly favoring startups that prioritize sustainability and social impact, reflecting a growing cultural emphasis on corporate responsibility. Additionally, younger entrepreneurs are embracing technology-driven solutions, leading to a rise in demand for flexible financing options that cater to innovative business models. This shift is further fueled by demographic changes, as millennials and Gen Z entrepreneurs seek funding that aligns with their values and lifestyle choices, thereby reshaping the capital raising landscape.

Trends in the market:
In the United Arab Emirates, the Venture Debt market is experiencing a notable shift towards funding startups that emphasize sustainability and social responsibility, driven by a cultural shift towards corporate accountability. Concurrently, younger entrepreneurs are increasingly leveraging technology to develop innovative business models, creating a heightened demand for flexible financing solutions. This trend is further amplified by demographic changes, as millennials and Gen Z prioritize investments that resonate with their values, significantly influencing the capital raising landscape and prompting traditional investors to adapt their strategies accordingly.

Local special circumstances:
In the United Arab Emirates, the Venture Debt market is uniquely influenced by its strategic geographic position as a global trade hub, attracting diverse international investors. The cultural emphasis on innovation and ambition, particularly in the context of the UAE Vision 2021, fosters a supportive environment for startups. Additionally, regulatory frameworks encouraging foreign investment and providing tax incentives further bolster the market. These local factors create a dynamic landscape where startups focused on sustainability and technology can thrive, reshaping traditional capital raising strategies.

Underlying macroeconomic factors:
The Venture Debt market in the United Arab Emirates is significantly shaped by macroeconomic factors including global economic trends, national economic stability, and fiscal policies. The UAE's robust economic growth, driven by diversification efforts away from oil dependency, creates a fertile ground for startups seeking alternative funding sources. Favorable fiscal policies, such as low tax rates and incentives for foreign investments, attract a diverse pool of international investors. Additionally, a growing emphasis on innovation in sectors like technology and sustainability aligns with global investment trends, enhancing the appeal of venture debt as a viable financing option in the region.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average of deal size and the number of deals.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data from OECD, annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, CPI, number of small and medium-sized enterprises (SME), new businesses registered (number) . This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

Visión general

  • Capital Raised
  • Average Deal Size
  • Global Comparison
  • Number of Deals
  • Analyst Opinion
  • Methodology
  • Key Market Indicators
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