Exciting Prospects Ahead: Here's What Dubai's Investors Believe Are The Tech Sectors Set To Shine In 2023 The next five years will see more interest in startups operating in industries that localize systems of production and consumption in order to make them more efficient, resilient, and secure.

By Ashok Raman

Opinions expressed by Entrepreneur contributors are their own.

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Lucidity Insights

Among the industries in Dubai that are enjoying an increased investor interest, e-commerce and fintech take up the first and second position in terms of number of companies that have raised above US$1 million through their lifetime. There are also companies focused on healthcare, education and logistics that are raising funding. Nine foodtech companies have raised close to US$1 billion in total. However, the majority of that is dominated by Kitopi. Social networking is also dominated by the funding raised by Telegram. Agtech was also among the ranks, but it was dominated by Advanta Seeds.

Source: Lucidity Insights

According to Global Ventures' Noor Sweid, "the next five years will see more interest in startups operating in industries that localize systems of production and consumption in order to make them more efficient, resilient, and secure. These include additive manufacturing (3D printing), supply chain management technologies, energy technologies that democratize access and are resource-efficient, and agriculture technology that facilitate local production, such as controlled environment agriculture and vertical farming."

Walid Hanna, Source: Lucidity Insights

Walid Hanna at Middle East Venture Partners added, "Other than the obvious artificial intelligence (AI) and blockchain tech, I expect there will be a growing demand for impact investing, where investors will seek to align their investments with their values and support solutions that address local, social and environmental challenges." In addition, he is also expecting an acceleration in digital transformation of industries that have been previously slow to adopt technology.

However, almost all of the investors said Dubai is still not a market where there is a lot of patient capital, a requirement for deep tech, and strong R&D developments. Investors agree that deep tech companies may struggle to attract local capital, as they typically require more time and resources to bring their products to market. As such, deep tech investments are a relatively new concept in Dubai, and the city is still in the early stages of developing a deep tech ecosystem. Here, Hanna says that "in order to promote investments in longer-cycle deep tech ventures, there needs to be a supportive regulatory environment and access to capital, as well as a talent pool with expertise in these areas."

To get the lay of the investor landscape across Dubai and the wider MENA, and for insights provided by the investors backing the startups and scaleups that are changing the face of entrepreneurship in the region, check out our report, Dubai's Venture Capital Ecosystem, by clicking here.

This article was originally published on Lucidity Insights, a partner of Entrepreneur Middle East in developing special reports on the Middle East and Africa's tech and entrepreneurial ecosystems.

Related: Dubai Chamber Of Digital Economy Vice Chairman H.E. Ahmad Abdullah Juma Bin Byat On The Emirate's Ambitions To Become The Digital Economy Capital Of The World

Ashok Raman is a storyteller who uses numbers as his medium. He loves to crunch data, analyze it, and investigate deeper questions until the stories begin to emerge on their own. Ashok comes from a finance and consulting background, having worked in the strategy consulting and private equity fields across the Middle East and Emerging Asia for over 15 years, prior to becoming a business writer. When it comes to tech stories, Ashok has a penchant for startups in the fintech, B2B software-as-a-service, artificial intelligence, and machine learning spaces. He loves writing about venture capital, mergers and acquisitions, and the general investor landscape of startup ecosystems. Ashok holds a bachelor’s of science in electrical engineering from the Georgia Institute of Technology, as well as a diploma in finance.

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