February, 20 2024

The Rise of Startups Awards and the need to Align University Education with Industry Demand

How UAE and Saudi Arabia are emerging as prime destinations for aspiring entrepreneurs

The-Rise-of-Startup-Awards

How UAE and Saudi Arabia are emerging as prime destinations for aspiring entrepreneurs

By Dr. David A. Schmidt – President of American University of Ras Al Khaimah (AURAK)

The Gulf region’s startup ecosystem is in acceleration mode. Little-known innovators and lesser-known innovators from the MENA – particularly those based in the UAE and Saudi Arabia — have been surprising the world with their unique innovations and apps, and attracting funds from global investors.

From cutting-edge platforms for flexible online payments to online trucking aggregators, and video streaming services to indoor farming systems, the MENA region is shaking up the startup universe with amazing home-grown innovations, such as Careem, Namshi, Tabby, Pure Harvest Smart Farms, Starzplay Arabia, Trukker and others.

According to a recent report by strategy consulting firm Redseer, MENA will produce more than 300 unicorns by 2030, dominated by the UAE and Saudi Arabia.

In fact, the UAE and Saudi Arabia have been voted best places in the world for aspiring entrepreneurs. According to the latest Global Entrepreneur Monitoring Index survey, which polled over 175,000 entrepreneurs from 51 countries, the two Gulf states have emerged as the top destinations worldwide for their supportive environment for new business ventures.

The UAE in particular is home to some of the world’s most successful tech and e-commerce startups, including Careem and Namshi. As of 2023, UAE-based startups accounted for more than half of all venture deals in the MENA region.

Between 2020 and 2022, the emirate of Abu Dhabi generated over AED 14 billion (USD 3.8 billion) in ecosystem value – a 134% increase from the previous two-year period, according to the same survey.

Last year, in Ras Al Khaimah, the RAK Department of Economic Development registered 1,839 new companies in Q1 2023, a 122% growth rate over the same period in 2022. In Dubai, the Dubai Chamber of Commerce saw a whopping 43% rise in new business registrations, while Abu Dhabi’s startup ecosystem is currently the 6th fastest-growing in the world.

Saudi Arabia, on the other hand, notched a 33% increase in startup growth in 2023 and is leading the MENA region with a record-high USD 1.38 billion in venture funding. A good example is the Technology Development Financing Initiative, which offers loan guarantees for up to 90% of the funding for tech startups. The vast size of the Saudi domestic market provides a great environment for startups to test their products and services, especially in e-commerce and fintech.

Youth’s Altered Mindset

The rise of startups has triggered an altered mindset among today’s youth. The dominance of AI which has disrupted the job market has led to the questioning of traditional approaches, especially those pertaining to higher education. Many universities are already recalibrating their curricula to be in tune with today’s market needs. It is a challenging scenario for education policy makers, but something that harkens to be addressed urgently.

In this context, the American University of Ras Al Khaimah (AURAK) has been at the forefront of proactive moves to align curricula with industry needs. The university runs a dynamic entrepreneurship Center in the region with a thriving student incubator that provides a supportive ecosystem for aspiring entrepreneurs. These programs often leverage technology to connect startups with mentors, investors, and industry experts.

The need for a deeper bonding between universities and the startup community has never been stronger. Therefore, events like the Middle East Startup Awards (MESA), the regional round of the Global Startup Awards — hosted recently by AURAK on its campus — is a step in the right direction. The Awards recognized the exceptional achievements of innovation and tech-driven startups and entrepreneurs from the United Arab Emirates, Oman, Qatar, Saudi Arabia, Bahrain, Kuwait, Lebanon and Jordan. More than 10 universities also participated in the event.

The finalists in the awards, as well as the winning startups, demonstrated how the region’s youth are engaged in carving new niches for themselves by thinking out of the box and venturing into the development of innovative solutions.

Events like the Startup Awards empower young innovators, including recent college graduates, to venture into entrepreneurial activities. They promote the development of an entrepreneurial ecosystem and reinforce a culture and mindset of entrepreneurship. Hosting such events on academic campuses inspires students and youth to dream big and embark on entrepreneurial ventures with confidence.

Beyond Education & Research

In view of the rising importance of startups, the traditional role of universities has undergone a massive transformation. Universities need to go beyond providing education and research. Today’s college campuses must create a rich environment for aspiring entrepreneurs with a wide array of entrepreneurship courses, strong support systems, advanced technologies, extensive resources, and ultimately the development of an entrepreneurial mindset.

Universities are called upon to play a role in developing a startup ecosystem by providing transformative education, fostering collaboration with the community, and supporting the commercialization of innovations.

To sum up, the future looks bright for startups in the GCC. The region’s rapid economic growth in recent years has attracted talents and investors from around the world, and the proactive government strategies in fostering entrepreneurship are bearing fruit. It paves the way for homegrown startups to expand globally, creating and sustaining a multitude of job opportunities in the process.

The biggest challenge is for higher education institutions to be in sync with the rapid movement forward. The programs they create and the strategies they devise need to be linked to evolving technologies and market dynamics. Innovation and entrepreneurship need to be instilled in every graduate at every step of their learning, so that they are ready not only for top jobs but also able to launch their own enterprises and startups.

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