SMEDistrict creates a new platform for SMEs & start-ups
An entrepreneurial festival took place in the UAE called Dream Station, from February 27 to March 7, 2020, at the Meydan Grandstand. It was a joint initiative between Meydan One, Mohammed
Bin Rashid Al Maktoum City –
District One and the SMEDistrict – a retail entrepreneurship incubation programme launched to support ambitious and innovative entrepreneurs and SMEs in the UAE.
“Dream Station is the biggest entrepreneurship festival held in the UAE, so far,” stresses Sheikha Aynour Alhussein, founder of SMEDistrict. “The response to Dream Station was very positive, as the participating SMEs and start-ups mentioned that they hadn’t seen an event of this scale before. We not only created a platform for the
SMEs to showcase their brands free of cost, but also made way for them to connect with investors. Moreover, since Dream Station is a collaborative initiative with government entities and our official retail incubation partners like Meydan One and Emaar, it is a great opportunity for local brands to gain global exposure.”
While on the one hand, the SMEDistrict has its own programmes to support SMEs and start-ups, through collaboration with the likes of Emaar, local, home-grown brands get access to premium locations. “They can compete with international brands in prime locations, like The Dubai Mall,” Alhussein points out. “As part of our partnership with Emaar, we can offer more than 6,000 sqft of retail space in prime locations dedicated to local SMEs and start-ups operating in the brickand-mortar and e-commerce space.”
“We are starting to accept applications from SMEs and start-ups for new space in the Fountain Views extension at The Dubai Mall that would possibly open towards second half of this year,” she reveals. “Prime locations like this will be available to local SMEs and start-ups at a 90% reduced cost compared to the original rent. Also, we will offer services like interior design, visual merchandising, feasibility studies and overall brand development within the same cost to help them promote themselves locally and globally.”
There are, of course, some criteria that SMEs and start-ups must fulfil to get selected for this programme. “Unique idea is the starting point,” states Alhussein. “And we help them to develop their idea into a commercially viable plan. We also evaluate the entrepreneur, whether she/he has
a prior background in business. We also take an in-depth view of their vision and commitment towards the endeavour in the long-term. That’s how we evaluate the start-ups.”
“For existing SMEs looking to accelerate, we evaluate performance in their current location or online, also a presence on social media, like Instagram,” she continues. “On our part, we offer a bigger space to the SMEs compared to the start-ups.”
In the UAE alone, the estimated number of SMEs is 400,000, 73% of which are in the retail and F&B industries. However, less than
1% of these SMEs manage to get international success. “We are keen to correct this situation because some of these SMEs are very promising and can have better potential for success with some guidance. That’s why we have started our programme for SMEs. And through our programme, by 202021, we will assist at least 400 SMEs and increase their transformation (into international successes) by 10%,” Alhussein observes.
But, do all local SMEs want to achieve international success or even seek such exposure?
“For an SME to even become recognised in the local market, they have to start somewhere. At Dream Station, there were several such SMEs that can well compete with international brands, but what they lack is capital to rent a highvisibility space or engage in marketing campaigns,” Alhussein responds. “That’s a big reason why their quest to gain international exposure could be limited. I don’t see a reason why a local designer from the UAE wouldn’t want to become a successful international retail brand. Some local designers are incredibly innovative in their designs and usage of materials, but due to lack of business know-how, their growth becomes limited.”
Up next is funding available for local SMEs and start-ups; the big question is, if the funnel of regional and international investors is growing?
“HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, and Ruler of Dubai is encouraging more and more foreign investors to come and invest in the UAE, to support innovation as start-ups and SMEs are the future generations. And the Dubai government is incredibly supportive of new ideas. The real challenge isn’t funding; it is the mindset of the SMEs,” Alhussein believes. “Sometimes, SMEs are the biggest stumbling block for themselves and their growth. They must be more committed to and passionate about their concepts if they want to secure investment. Funding is available for credible concepts and committed people behind them.”
“For example, if an SME is seeking investment to transform into an international brand, the investor will not only invest in the business but also the people running it,” she elaborates. “Therein lies the need for serious focus and efforts on the part of the brand owner to ensure growth and development of the concept.”
Moreover, Alhussein feels that “sometimes giving SMEs and startups too much funding will destroy their business as much as if they have no funding at all.” After all, cash is just a tool, she says. It’s not the primary resource required to have a successful business, because if the idea is successful, there will be sources of income, such as the cash flow, she opines. “There are so many ways to gain global exposure and validation from customers – through free channels like YouTube and Instagram – even before seeking funding.”
However, a large chunk of funding tends to get allocated to technology-oriented concepts, Alhussein agrees. “But that’s changing,” she points out. “With the rise in credible e-commerce concepts and support of our programme – focused on assisting the journey from local to global – more and more SMEs and start-ups will gain exposure and thus increase their chance of getting funded.”
When asked about early-stage investors and their interest to support start-ups and SMEs scale up, Alhussein confirms that at each stage investors are available. “Of course, when compared to the number of SMEs around the world, the number of investors is less. Having that said, every SME or start-up that can validate their business idea and performance can get attention. Right now, a hugely progressive step has been taken by our government to lower the cost of starting a business to make headway. For example, through our programme alone, SMEs and start-ups can lower the cost of setting up by 90%. In effect, this will help an investor to put money into more businesses as the cost of setting up reduces.”
By being an entrepreneur herself, Alhussein can better understand the hurdles faced by start-ups and SMEs. “That’s why I decided to develop the SMEDistrict programme,” she asserts. “I started with one employee. I understand the market and employment challenges as well as cash flow issues.” ■