Scaling up MENA SMEs

The scale-ups ecosystem in the MENA

Our “scale-ups readiness index” measures the maturity of the scale-ups ecosystems in key MENA countries.

Explore the scale-ups ecosystem in the MENA region using the drop-down menu below. Choose a country to learn more about its scale-ups ecosystem readiness.

Business fundamentals

Efficient and transparent regulations for traditional businesses, not for innovative ones. Regulations lack coherence across the emirates

Advanced infrastructure and facilities, yet very expensive

Business propellers

VC/PE activity is well developed with a focus on tech startups; bank financing is expensive

Lack of senior and tech skills and reluctance of nationals to work for private sector led to high reliance on expats, requiring complex/costly paperwork

Developed and booming support ecosystem, but mainly for SMEs

Demand creators

Long payment cycles, bureaucracies, and delays when dealing with the government. Dubai launched initiative to source 10% of procurement from SMEs

Dubai exports support expansion of UAE companies to new markets

Country readiness

UAE, mainly Dubai, offers the most agreeable and stable lifestyle in the region

Business fundamentals

Partially updated regulations with a sub-optimal process that lacks transparency

Lack of advanced or optimal infrastructure and facilities

Affordable facilities yet only a few are dedicated to new and agile firms

Business propellers

VC/PE activity is well developed and focused mainly on tech startups; Central Bank initiatives to facilitate bank financing

Large pool of skilled talent except for advanced tech skills; yet country suffers from brain drain. Salaries are affordable but laws are rigid

Available support ecosystem, but mainly targeting SMEs

Demand creators

Lack of government/large firm support for SMEs; players mainly rely on their personal connections

Difficulty accessing new markets due to low compliance with international standards and lack of information on export markets

Country readiness

Attractive place to live due to its entertainment, restaurants, and nightlife scene; yet faces political instability and weak economic situation

Business fundamentals

Incomplete and opaque laws; a few improvements have been initiated such as setting up a OSS portal to facilitate opening up a business

vailable infrastructure and facilities; yet costly compared to the MENA region, especially in the city centers. More options are being introduced with five co-working spaces opening up in Riyadh

Business propellers

Nascent VC/PE and bank financing for growing businesses; high reliance on family and friends

Removal of subsidies and introduction of taxes

Preference for public-sector jobs due to the high salaries paid; while it is complex and increasingly expensive to hire expats

Increasing number of events/mentoring programs for startups; some government initiatives to support scale-ups, in the planning stages

Demand creators

Challenging access to government procurement; yet law is being reviewed to include preferential treatment for SMEs

Monsha’at deals with large organizations to allocate 15% of procurement for SMEs

Development of new laws to support scale-ups in exports

Country readiness

Relatively conservative country; yet started to boost cultural and entertainment activities in line with national vision

Relatively stable political and economic environment

Business fundamentals

Constantly changing regulations coupled with variable fees and unpredictable process

Availability of quality technology infrastructure; yet there remains room for improvement/further development

Affordable facilities yet only a few are dedicated to new and agile firms

Business propellers

Traditional financial products that do not meet scale-ups’ requirements. Challenging to set-up VC/PE funds; expensive bank financing

Availability of skills despite brain drain; yet mismatch between the skills supplied and the ones in demand, even in traditional disciplines

Growing landscape for events/mentoring yet focused on tech startups

Demand creators

Lack of government/large firm initiatives to promote products and services from SMEs; players rely on their personal connections

Lack of consistent and comprehensive public and private programs to support access to local and international markets

Country readiness

Convenient, modern, and stable lifestyle; yet not as upbeat as Dubai and Beirut

Business fundamentals

Unclear, complex, and inconsistent regulations; efforts to improve them are not enough

Sub-optimal quality of infrastructure with room for internet improvement in terms of reliability and speed; yet prices are affordable

Limited costs to set up and operate an office; yet quality is sub-optimal

Business propellers

Nascent VC ecosystem, but quickly evolving with high focus on tech; new Central Bank initiative trickling to SMEs, yet focused on priority sectors

Availability of large pool of talent lacking only advanced technical skills, yet they are more inclined to work with large and “stable” organizations. Salaries are affordable

Nascent yet growing support ecosystem (mentoring, networking, etc.)

Demand creators

Large companies/government entities are hesitant to work with emerging companies

Devaluation has prompted a large segment of consumers to tap into newer, local, and less-known brands and providers

Lack of access to data about export markets and understanding of regional and global demand dynamics

Country readiness

Agreeable lifestyle; yet with massive traffic congestion and pollution

Random political incidents directly affecting economic stability

Egypt

1) SMEs are companies with 10 to 250 FTEs

Jordan

1) SMEs are companies with 10 to 250 FTEs

Lebanon

1) SMEs are companies with 10 to 250 FTEs

Saudi Arabia

1) SMEs are companies with 10 to 250 FTEs

United Arab Emirates

1) SMEs are companies with 10 to 250 FTEs

A central coordination to orchestrate these efforts

To reap these rewards, each MENA country will benefit from a central champion of the scale-ups strategy. It could be a private- or a government-sponsored entity. The main role of the champion will be to define, oversee, advocate, and sustain the scale-ups ecosystem.

The team should be relatively small and nimble. Its success depends on mobilizing an ecosystem of private and public players to orchestrate growth initiatives.

11 Mar 2024

Download PDF -

Time to thrive: Urban resilience shifts from trend to necessity

The urban resilience framework assesses a city's exposure to hazards, vulnerabilities, and institutional capacities to respond, recover, and transform. Explore our interactive tool.