In an interview with Intelligent SME, H.E. Abdul Baset Al Janahi, CEO of Dubai SME shares his strategies for growth and development of the SME sector and emphasized on how Dubai SME encourages young entrepreneurs to venture in this territory hereby making the UAE hub for small and medium businesses.
Q: What were the strategic initiatives that were successfully launched by Dubai SME under your leadership?
Between 2002 and 2008 we launched a series of value added services to entrepreneurs that covered start-up subsidies, incubation, training, financing, and Government Procurement Programme. With our new mandate in 2009, we started launching larger scale initiatives aimed to establish a complete entrepreneurial ecosystem.
A major initiative in this regard was the official SME Definition articulated in 2009. By classifying small and medium enterprises on the basis of their performance and workforce the Dubai SME Definition helps entrepreneurs and their start-ups to access finance and partners required to move to the next level.
In 2010, Dubai SME launched Intelaq, a home-based business option that enables entrepreneurs to launch their business projects at minimal cost and risk. A number of entrepreneurs – especially women – have benefited from Intelaq as it allows a wider ground to take off and at the same time remain part of Dubai SME’s entrepreneurial support network.
Under the patronage of His Highness Sheikh Hamdan Bin Mohammed Bin Rashid AL Maktoum, Crown Prince of Dubai and Chairman of the Dubai Executive Council, we launched the Dubai SME100 ranking in 2011 to identify the top-performing SMEs in Dubai and help them grow into bigger and more sustainable enterprises. Currently in its third cycle, the ranking has grown into a major driver of capability development, innovations and job creation in the SME sphere.
With a view to providing the necessary knowledge and education for entrepreneurs to step out confidently into the world of business and succeed, we launched the Dubai Entrepreneurship Academy in 2013. The Academy aims to fill the knowledge gap in the SME domain and sustain Dubai’s tradition of successful enterprise. Programmes offered by the Academy emphasise on critical skills, particularly those related to retailing and customer relations.
Last year, Dubai SME unveiled the Hamdan Innovation Incubator (Hi2), a complete support system to stimulate and foster innovative entrepreneurial ideas and projects. Hi2 is the first and the largest of its kind hub that provides knowledge, guidance and support to ensure the uninterrupted growth of an entrepreneurial idea into a successful business.
Earlier this year, Dubai SME launched the Mohammed bin Rashid Fund for SME, a government initiative established by a law issued by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, to maximise financing solutions for innovative businesses and developing Emirati entrepreneurs. Emirati nationals in the 21-65 age group can avail of two types of loans from the Fund: the Seed Capital Loan, offered directly to startups requiring funding of more than AED 50,000 but not exceeding AED 500,000, and the Credit Scheme Loan, offered through banking partners and guaranteed by the fund, to both startups and existing businesses requiring a funding of more than AED 500,000 but not exceeding AED 5 million.
Q: SMEs make up 75% of the economy. So what are the new initiative Dubai SME will roll out in support, development and sustenance of SMEs this year and the next?
Actually, according to our definition, SMEs in Dubai comprise up to 95% of the total business establishments, contribute 40% of the Gross Domestic Product, and constitute 42% of the labour force.
Dubai SME will continue to roll out initiatives and programmes required to fill gaps in the entrepreneurial support system in Dubai and position SMEs to benefit from the diversification and global aspirations of Dubai’s economic development strategy. We maintain an active interface with the SME community to understand their needs and conducts an SME Pulse exercise to collect sector feedback. Simultaneously, we work with policy-makers to review existing policies and enhance them for improved SME outcomes.
Q: People are sceptical to establish an SME as it is a challenging path. How does Dubai SME encourage entrepreneurs to venture in this territory?
The interest among UAE nationals is growing exponentially in recent years. For example, in 2014, we have seen a 31% increase in number of new entrepreneurs approaching Dubai SME for various support services.
Some the challenges they face are the competition in the market, the changing regulatory requirements from different government entities that hinders new concepts and business models, in addition to some cultural challenges such as fear of failure and not accepting external advice, which are normal in any environment.
Therefore, Dubai SME takes a life cycle approach to SME development. From early stage seed start-ups to mature SMEs, Dubai SME has a variety of initiatives and services ranging from assisting new entrepreneurs start easily and facilitating access to business resources and market opportunities to focused growth-oriented programmes for the top SMEs.
Below is a quick brief on some of the key programs and initiatives:
Development Advisory: Dubai SME has provided business development and advisory services to entrepreneurs and assisted in the launch of local businesses.
Business Incubation: The Business Incubation Centre helps entrepreneurs progress throughout the early stage of growth. The suite of services, which are tailored and continuously delivered, helps identify and remove obstacles and bottlenecks, and increase their survival rates.
Entrepreneur Relations (ER): Serves entrepreneurs by accelerating business start-up through a variety of services such as guidance on type of business, mode and category of business licensing, reducing business start-up costs, and accessing reduced rate location real space.
Funding Support: Provide debt funding to address the challenges of the funding gap for start-ups and make capital available to them on a per-need basis.
Entrepreneurship Capability Development: The Dubai Entrepreneurship Academy offers practice-base Diplomas and short courses in entrepreneurship Development.
Young Entrepreneur Competition: The yearly competition challenges participants to create a pop-up business and manage it over four days in local malls throughout the city. Students get the opportunity to learn about business planning, product and service conceptualisation, marketing and customer service
Mohammed Bin Rashid Award for Young Business Leaders (YBL): The awards recognises outstanding business leaders in the Arab world who have shown creativity and perseverance to launch and develop their business.
Dubai SME100: In line with the strategy to groom promising SMEs, the Dubai SME 100 was launched to act as a platform and catalyst to identify high potential SMEs based in Dubai – to groom them to become bigger, better and sustainable enterprises
Q: As the CEO of Dubai SME, how does your role enable you to get involved, engage and design strategies that stimulate economic stability in the SME sector?
As an agency of Dubai’s Department of Economic Development Dubai SME has a role in government strategy and programmes. We work with our entire stakeholders to support entrepreneurship development, enhance business-friendly policies. And promote a customer-centric approach.
Q: Globalisation is the key to unparalleled success. How is Dubai SME helping home-grown brands turn global and build a strong brand identity for UAE?
The Dubai SME100 ranking was launched in line with our strategy to identify high potential SMEs based in Dubai – to groom them to become bigger, better and sustainable enterprises. We also have a special Export Preparation programme with our sister agency Dubai Exports to help potential exporters step beyond the UAE and expand regionally and globally.
Q: What are the cornerstones that need to be attained to transform Dubai into a global centre of innovation and excellence for SMEs?
With 2015 being the ‘Year of Innovation’ and recent trends in the online, cloud computing, social media and mobile technologies, there are tremendous opportunities for SMEs to offer innovative business models, products and services. Therefore, we expect that numbers of tech entrepreneurs will continue to grow in the coming years driven by various government initiatives and the Expo 2020 plans.
Various government entities in the UAE have launched special programmes and initiatives to support entrepreneurs in the tech space – Hi2, Silicon Oasis, in5, to name a few, in addition to R&D (Research & Development) support at Masdar and Khalifa University.
We constantly work with stakeholders, including the entrepreneurs to understand what they need and launch joint initiatives. Dubai SME cannot do it alone, and must have a responsive SME sector, in order to develop innovative support schemes that will transform Dubai into a global centre of innovation and excellence for SMEs.