View / Abu Dhabi continues to attract startup founders despite war

Organizers feared a subdued annual gathering for Abu Dhabi’s seven-year-old entrepreneurial center Hub71; the vibe at the event this week was anything but. There were hundreds of attendees — entrepreneurs, investors, academics, and corporates — noshing on handouts of poke bowls and mango popsicles, with one founder wearing a T-shirt indicating he was fundraising and also “accepting free shawarma.”

Hub71, backed by sovereign wealth fund Mubadala Investment Company, recruited 27 startups to its most recent year-long program, offering cash and investor introductions to founders in exchange for the option of future equity. All of them are from outside the UAE, and not one has dropped out despite the economic fallout from the Iran war.

While one entrepreneur lamented how quiet Abu Dhabi was during the early weeks of the conflict, things are starting to pick up. Another founder developing AI for the energy industry (who asked not to be identified) said he had been preparing to close a $5 million funding round from regional venture capital funds when the war broke out. “Investors basically ghosted,” he told me, but in the last couple of weeks those backers have begun answering the phone again. He now expects to close the round in September.

Startups aiming to tackle some of the Gulf’s largest pain points and opportunities — financial inclusion, food security, and longer lifespans, to name a few — are a crucial part of the UAE’s diversification drive and its efforts to import less technology and build more at home. It’s a strategy that is drawing in international and regional investors: Hub71’s CEO Ahmad Ali Alwan told me Abu Dhabi has helped investors expand their horizons beyond San Francisco. Some 50 family offices from the Middle East have also partnered with Hub71, both for the potential investments and for innovations that might be useful to their portfolio.

Gulf startups have expanded even as global venture funding has contracted. A full view of the war’s impact on investments and firms’ valuations has yet to emerge, but in Abu Dhabi, at least, the entrepreneurial scene is showing some pluck.