Regional investors must support start-ups, says Dubai Future Foundation CEO Saif Al Aleeli

In an exclusive interview with Arabian Business StartUp, His Excellency Saif Al Aleeli, CEO of the Dubai Future Foundation and the Dubai Future Accelerators, explains that the history of Dubai’s achievements is about to repeat itself, advising regional investors not to miss following in the footsteps of the UAE’s trailblazing government.

Always have a futuristic vision. Run faster and try to be five or 10 years ahead of others. These are not just simple phrases.

A panoramic view of Sheikh Zayed Road, with its slim, super-tall towers battling for attention with the iconic Burj Khalifa, which loom outside the window behind the man uttering these words, proves he is telling the unvarnished truth.

“When Dubai does things, we tend to do it right,” says His Excellency Saif Al Aleeli, CEO of the Dubai Future Foundation, in an exclusive interview with Arabian Business StartUp at Jumeirah Emirates Towers. “It is true that we want to do it first, but we do it right as well.”

Last April, His Highness Sheikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, launched the Dubai Future Foundation responsible for implementing the Dubai Future Agenda, an umbrella strategy to reinvigorate strategic sectors and instil a future-focused culture in the country. In addition, AED1 billion has been allocated to achieving these goals through the newly-established Future Endowment Fund.

For Al Aleeli, the task in hand is nothing but “a continuation of the Dubai story,” he says referring to the late ruler His Highness Sheikh Rashid Bin Saeed Al Maktoum’s vision of Jebel Ali Free Zone in the early 1970s when few believed that this new port was necessary. It became the backbone of the UAE’s logistics sector.

A decade later, His Highness Sheikh Mohammed bin Rashid Al Maktoum launched Emirates Airlines, one of today’s key players in the aviation industry, with a small team of professionals and just two aircraft. The later economically transformational projects, including Dubai Internet City, Dubai Media City, and the Dubai International Finance Centre, Al Aleeli adds, helped Dubai position itself as a global business hub.

“The idea of the Dubai Future Agenda is to create some sort of an institutional framework through which Dubai can sustain the success of this story,” he says. “That story has always been about being ahead of others, knowing that we are living and working in a very competitive world. It is not only us in this competitiveness race. For us, the only way to do it is to run faster than others, see our objective before others, and try to create strategies and plans to do so.”

The Agenda’s main initiatives include the Future Cities programme, a framework for achieving UAE’s cross-sectoral innovation leadership; the Future Partners programme, a global partner network in the areas of innovation, research and development; the World Federation of Future Sports, an organisation to oversee the future sports sector; and the Global Blockchain Council, a global forum to discuss the best applications in Blockchain technologies. Furthermore, the Museum of the Future, to be opened in 2018, will be a creative hub for inventions in health, education, energy, smart cities, and transportation.

“In a nutshell, the Agenda is based on three main pillars, starting with individuals because they drive the change,” Al Aleeli says. “It is quite important for us that our people, namely those in government institutions, understand why we take the issue of the future seriously.

“The second pillar is the institutions, mainly those of our government. What we are trying to do is to increase the readiness of our government entities to face the future and exploit its opportunities by looking at every single challenge relevant to them.

“If I am working, for example, in the energy sector, I wonder what it will look like in 10 years. Will the investments that I am putting into my infrastructure, my systems, and my resources today, be valid in 10 or 20 years? The issue is that government institutions often allocate heavy investments into things that are quite difficult to change.

“If you start investing right now, you have to be agile enough to know that there is a disruptive innovation and that your whole business model might actually change. There might be a new game that you need to be aware of.

Named Office of the Future, the 3D building is the DFF’s temporary office.

“The third thing is to focus on sectors, by which we mean that we need to enhance the competitive advantage of our current sectors. What are we doing well? How can we increase the efficiency in the logistics sector, for example? Sometimes it is disruptive and transformational, but if this is the way to go, we have to do it.

“Also, how can we introduce new technologies and new concepts? We aim to add new sectors to our economy by looking at new business models and new markets that these emerging technologies will create, such as Blockchain or augmented reality.”

Among Arab countries, the UAE is already considered highly innovative, as evidenced by its 41st worldwide ranking in this year’s Global Innovation Index (GII), published by Cornell University, INSEAD, and the World Intellectual Property Organisation. Saudi Arabia, Qatar, and Bahrain are ranked 49th, 50th, and 57th among circa 128 nations reviewed.

Resource-scarce, but innovative Switzerland has topped the GII international rankings for six years in a row. This year, it is followed by Sweden, the UK, and the United States.

Other countries have also been successful in climbing the list of efficient innovators, with some of the examples being India jumping to 66th place from 81st or China moving up from 29th last year to 25th this year.

However, with the recent announcement of the Dubai Future Accelerators, the world’s largest government-supported accelerator, hosted by the Dubai Future Foundation in partnership with the seven founding government entities, the UAE might be well on the way of breaking into the world’s top 10 innovative economies.

Launched by the Crown Prince of Dubai, His Highness Sheikh Hamdan bin Mohammed bin Rashid al Maktoum, the Dubai Future Accelerators is a three-month-long intensive start-up acceleration programme, enabling the Dubai government to source cutting-edge solutions from around the world.

For its three annual cycles, the accelerator will be selecting entrepreneurs, teams and companies from any part of the world and of any scale, from start-ups to large corporations, but with a working prototype that has the potential to solve the seven “21st century challenges” previously determined by the participating government entities. Those include Dubai Roads and Transport Authority, Dubai Electricity and Water Authority, Dubai Police, Dubai Municipality, Dubai Health Authority, Dubai Holding, and Dubai Knowledge and Human Development Authority.

The top-down approach to fostering innovation is not unusual. The US Defence Advanced Research Projects Agency (DARPA) is credited for creating the Internet. However, it is primarily responsible for the development of emerging technologies for one client only - the US military.

Europe aims to overcome the current lack of disruptive market-creating innovations by launching yet another EU organisation. In addition to the European Research Council, which provides basic research grants to scientists, the union considers founding the European Innovation Council, a new body to be trialled between 2018 and 2020, with the funds of its Horizon 2020’s €2.8 billion SME Instrument. It is aimed at supporting the scaling up of European start-ups.

Farther afield, China’s “Medium to Long Term Plan for the Development of Science and Technology,” widely known as the 2006 MLP, was initiated to reduce the country’s reliance on imported technology and leapfrog foreign competitors in strategic emerging sectors.

The UAE’s signature innovation competency, being slowly revealed to the world through the Dubai Future Accelerators, stands out among other innovation-related national strategies with its long-term and global ambition. “What we are trying to do and how we differentiate ourselves from others is that we are focused on challenges and opportunities related to major sectors and the things that are more relevant to people’s lives,” says Al Aleeli.

For each of the seven challenges, the accelerator aims to identify and deploy at a city-wide scale futuristic prototypes and products, which span from automated transport solutions that cut congestion by 20 percent, technologies to enhance diagnostic speed and effectiveness, to systems for identifying, tracking and sharing information on criminals, among others.

“Coming up with these challenges was not a job of the Dubai Future Foundation, but it was done in collaboration with the entities,” says Al Aleeli. “At the end of the day, the solutions will have an impact on the entities and their sectors, so we needed them to own the challenges and to be 100 per cent comfortable with them.

“With these challenges we speak to the world. The challenges set forward are not, for example, DEWA’s challenges or the challenges of the energy sector in Dubai, but global challenges. Dubai is trying to solve global challenges.”

The intrinsic value of their plans is even grander. In October 2014, His Highness Sheikh Mohammed approved the Happiness Agenda, tweeting that it was a programme to “introduce happiness as a way of life in the emirate.”

“We need to focus on sectors which are relevant to individuals, and by enhancing the performance of these sectors we will make our people happy,” explains Al Aleeli. “We are distinguished from others, I think, because we are a fast moving government. Dubai is known for being fast. It is known for having a government which is quite serious and committed.

“Having the name of Dubai and the seven government entities being part of it has helped create a sort of legitimacy to our project. They see us all moving, not only the Dubai Future Foundation.”

The programme received over 2,274 submissions from 73 countries, on all 7 continents.

The world’s first fully functional 3D printed building was inaugurated in Dubai in May, less than a month after launching the Dubai 3D Printing Strategy. Named Office of the Future, the 3D building, which took 17 days to develop, now houses the temporary office of the Dubai Future Foundation.

Also under the umbrella of the Dubai Future Foundation, the Dubai Autonomous Transportation Strategy, launched in June, aims to transform Dubai into a 25 percent vehicle autonomous city by 2030, which has been projected to save AED 22 billion in annual economic costs. Hardly two months later, box-like driverless vehicles were rolled out in Downtown Dubai.

“For us innovations and ideas do not mean anything until they get executed,” adds Al Aleeli. “We wanted to accelerate the actual accelerator model. We have a lot of these models available here, but the way we look at it is that we have three main stakeholders, namely the government, entrepreneurs, and investors. We wanted to create a win-win formula for all of them.”

For its first cycle, the programme received over 2,274 submissions from 73 countries, on all 7 continents. Most of the submissions came from the US, followed by the UK, Germany, India, Singapore, and Australia, in addition to a large number of local start-ups. With only 30 companies selected for the programme’s first cycle, the application to acceptance ratio was around 1 percent.

Why has the response from the world’s innovators been so overwhelming? For Al Aleeli, the answer is simple. “One of the main challenges entrepreneurs face is not only access to funding, but finding a potential client,” he says. “This is their main challenge. Since governments are actually the biggest clients worldwide, our government will actually create value and help them scale up their business.

“However, we are being extremely clear with them. We are not doing a blue sky research with them, we do not want innovation per se. We want innovation in these particular areas. So, focus your efforts.

“If it works out, we are at the receiving end, meaning that we will create the market for you. We will create that opportunity for your business development. So, it is not only about funding, but about business development and market opening opportunity that the government is providing to entrepreneurs.

“Yet, we do not expect companies to come and solve each particular challenge, but any step forward in solving that challenge will mean a lot to that sector. For year one, we will stick to those seven, and after the first cycle we will know more. We do not shy away from the fact that we might need to change a little bit.”

In addition to an Emirates roundtrip airfare to Dubai, 90 days of paid accommodation, a 12-week paid business development process, including access to the Dubai Future Accelerators prototyping lab and mentorship, the selected entrepreneurs will get access to $2 million venture capital per month. To top it all, the Dubai Future Accelerators will take zero equity in their business.

“In terms of not taking equity up front, what we are trying to do is to create that communication between government entities and entrepreneurs,” explains Al Aleeli. “If this handshake is done, it is enough for us because it will enhance the performance of our entities. They will get access to early breakthrough technology.

“It will also show convenience to conventional investors, which is that the government is here as a client and also has a fund to invest in those solutions. They will feel more comfortable. We are creating that sentiment of comfort to those private investors.”

The Future Endowment Fund will invest AED1 billion over the course of five years in projects and companies capable of passing the programme and solving the challenges by developing projects on the ground. However, the government-led investments in a new innovation-focused field will serve an additional purpose – instilling a new investment culture in the region. In spite of monetary abundance in the region, Al Aleeli explains, clearly warming to this theme, regional investors still prefer to fund conventional sectors, such as real estate, which is “the old school of investment.”

“First of all, we are now saying to the investors that the world of investment is not restricted to these sectors,” he says. “They need to think outside-the-box. They need to compare their returns from retail or infrastructure to these future-oriented sectors.

“We are creating a new deal flow for them to invest in, not in conventional sectors, but in breakthrough technologies. We are also hedging the risk for them by telling them that there is an opportunity between that new company and a big client waiting for that solution already.

“We are telling them that there is not only an entrepreneur standing in front of them to pitch, but that he is already pitching to his client. And he might actually get it!” The second client, Al Aleeli assures both entrepreneurs and investors, will come based on Dubai’s credibility, and ends our conversation with an important message. “Being an entrepreneur is always exciting at a personal level, but joining us will make you part of a global cause,” he says. “We are not here to develop new apps for people to chat, but we are trying to solve global problems, which will have a massive impact on the lives of millions of people.

“That will give more depth and meaning to what you do.”

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Posted by: hassanain Jafferali

way to go Dubai

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