From funding to scale: Why are more Indian founders building in Dubai

Dubai being ranked the world’s third most start-up-friendly city in the Startup Friendly Cities Index 2026 is seen by Indian founders not just as a branding milestone, but as a clear signal that capital decisions are starting to shift.The city ranks behind Silicon Valley and London, reinforcing its positioning as a founder-centric jurisdiction rather than merely a regional base. The ranking coincides with a sharp rise in Indian business registrations and a bigger change in how founders are thinking about company structures, ownership, and where capital ultimately resides.A new analysis by Dubai Chamber of Commerce shows that Indian-owned businesses continued to top the list of new non-UAE companies joining the chamber during the first nine months of 2025. A total of 13,851 new Indian members joined during the period, marking year-on-year growth of 13.9%.

The figures highlight Dubai’s continued appeal as a preferred destination for Indian investors and entrepreneurs. What stands out is not just the volume, but the intent behind these moves.Indian founders are no longer incorporating in Dubai only for ease of doing business or regional access. Increasingly, they are raising capital, setting up holding companies, and anchoring governance frameworks in the UAE, while continuing to build products and teams across India and other markets.Capital gravity is shiftingDubai’s growing relevance as a capital hub has been reinforced by a rebound in regional venture funding, particularly at the growth stage.“It’s an extremely positive sign to see growth in late-stage investments,” said Philip Bahoshy, Founder and CEO of Magnitt. According to MAGNiTT’s Q3 2025 MENA VC Report, 91 per cent of the region’s total funding this year came from Saudi Arabia and the UAE. This indicates that growth-stage activity is concentrated within the GCC, where sovereign-backed ecosystems have created real depth in the market.

For Indian founders evaluating Dubai, this signals that the funding ecosystem in the UAE has become more mature, with stronger late-stage capital and a wider base of active investors.Bahoshy also pointed to the changing composition of investors backing the region. “This increase reflects a more liquid environment, supported by international investors now accounting for around 50 per cent of total capital,” he said.

For Indian founders, this liquidity matters not only as capital flowing into Middle East start-ups, but as an opportunity to build globally credible cap tables from Dubai, with access to regional funds, family offices, and international investors.D33 and the infrastructure behind scaleDubai’s start-up momentum is closely tied to the D33 economic agenda, which aims to double the size of the emirate’s economy by 2033 and place entrepreneurship at the centre of that growth.A key outcome of this push is Dubai Founders HQ, positioned as a central platform connecting founders to capital, regulators, and global markets.Launched as a joint initiative of Dubai Economy & Tourism (DET) and the Dubai Chamber of Digital Economy, Founders HQ brings together licensing support, ecosystem partnerships and investor access under a single framework. At the launch of the initiative, Omar Sultan Al Olama, UAE Minister of State for Artificial Intelligence, Digital Economy and Remote Work Applications, said “The launch of Dubai Founders HQ marks a significant milestone in our journey to position Dubai as a global hub for digital entrepreneurship. This initiative reflects our commitment to creating an integrated and founder-focused ecosystem that accelerates innovation, attracts international talent, and empowers start-ups to scale beyond borders.” For Indian start-ups, platforms like Founders HQ are increasingly viewed not as support programmes, but as structured gateways to capital credibility and market access, particularly for founders building cross-border businesses.Regulation as an enablerInitiatives such as Sandbox Dubai, which allows companies to test new business models in coordination with policymakers. “Sandbox Dubai is designed to strengthen Dubai’s regulatory and innovation ecosystem by identifying emerging opportunities and working with government and private sector partners to develop forward-looking regulations that support their operations and future projects,” said Khalfan AlJaziri in a Dubai Future Foundation announcement in December 2025. Sandbox Dubai operates as a government-wide platform under D33, allowing innovators to test technologies within an adaptive regulatory framework.For founders operating in regulated sectors such as fintech, healthtech, logistics, and AI, this approach reduces uncertainty and speeds up market entry, factors that are increasingly shaping jurisdictional decisions.Dubai’s Virtual Assets Regulatory Authority (VARA) has further reinforced this framework by establishing dedicated oversight for digital asset businesses operating in and from Dubai.Why are Indian founders paying attentionAngel investors and ecosystem leaders say Dubai’s appeal also lies in the diversity and density of its talent networks.“Imagine an Indian software engineer teaming up with a Ukrainian hacker and a McKinsey-trained sales leader. These synergies create strong, well-rounded companies that are difficult to replicate elsewhere,” said PK Gulati, Chairman Emeritus of TiE Dubai. This cross-border mix is proving particularly attractive to Indian founders building global products, where engineering may remain in India while sales, partnerships, and investor engagement are anchored in Dubai.A jurisdictional resetDubai’s third-place ranking reflects speed, policy clarity, and ecosystem maturity. For Indian startups, it signals something more structural.The emirate is increasingly becoming the jurisdiction where global holding structures are anchored, investor relationships are formalised, and governance frameworks are put in place, even as product development and engineering remain distributed across markets.For founders building beyond early-stage momentum, the shift is clear. Dubai is not just a funding destination, but a base for long-term scale.Click here for more on Business in Dubai.References:1. https://u.ae/en/about-the-uae/strategies-initiatives-and-awards/strategies-plans-and-visions/finance-and-economy/dubai-economic-agenda-d33?2. https://www.dubaifuture.ae/latest-news/sandbox-dubai-strikes-first-global-partnership-in-mouwith-ai-center-hamburg3. https://sandboxdubai.gov.ae/supporting-innovation 4. https://rulebooks.vara.ae/ Disclaimer: This article is part of a featured content series on Business in Dubai.