Tech startups in the UAE raised a total of $872 million in the first quarter of 2025, reflecting a dramatic 865 percent rise from the $90.5 million raised in Q1 2024 and a substantial increase of 194 percent compared to the $297 million raised in Q4 2024.
This sharp climb in funding signals a notable shift in capital deployment patterns within the UAE’s tech sector. In its latest Q1 2025 UAE Tech Funding Report, Tracxn noted that the UAE witnessed a significant rebound in venture funding during the quarter, marked by an influx of late-stage capital and an uptick in $100 million+ mega deals.
With key sectors such as enterprise applications, fintech and retail driving investment momentum, the ecosystem appears to be entering a phase of renewed investor confidence.
Late-stage funding drives surge
In the UAE, late-stage funding drove the overall funding surge, with $760 million raised in Q1 2025, an impressive 660 percent increase over the $100 million raised in Q4 2024.
Seed-stage funding in Q1 2025 totaled $23.4 million, marking a significant decline of 77 percent compared to $100 million in Q4 2024 and a 62 percent drop from $61 million in Q1 2024.
Meanwhile, early-stage investments amounted to $89 million in Q1 2025, a modest decline of 8 percent from the $96.5 million raised in Q4 2024 but a substantial increase of 202 percent over the $29.5 million tech startups in the UAE raised in Q1 2024.
Enterprise applications sector drives funding boom
Enterprise applications emerged as the leading sector in Q1 2025, with UAE tech startups securing a total of $688.1 million in funding. This represents a 664 percent increase compared to the $90.1 million raised in Q4 2024 and a 1111 percent surge over the $56.8 million raised in Q1 2024.
Second came the fintech sector, with $215.6 million in funding, a 73 percent increase from $124.6 million in Q4 2024 and a 574 percent jump from $32 million in Q1 2024.
Meanwhile, the retail sector saw $171.5 million in funding in Q1 2025, reflecting a 134 percent rise from $127.6 million in Q4 2024 and a staggering 13,092 percent increase compared to $1.3 million in Q1 2024.
Vista Global and Tabby raise over $100 million
In Q1 2025, the UAE saw two $100 million+ funding rounds compared to one in Q4 2024 and none in Q1 2024. Vista Global and Tabby were among the companies that raised over $100 million this quarter.
Tabby raised a total of $160 million in a Series E round led by Blue Pool Capital, valuing the company at over $3300 million. Meanwhile, Vista Global secured $600 million in a late-stage round led by RRJ Capital. A major part of these major funding rounds came from enterprise applications, fintech and retail sectors.
The report also revealed that Micropolis was the only company to go public in Q1 2025. There were no unicorns created in Q1 2025, Q4 2024 or Q1 2024. In addition, tech companies in the UAE recorded six acquisitions in Q1 2025, maintaining the same level as Q1 2024. Cartlow was acquired by Basatne in what became the highest valued acquisition of Q1 2025, followed by the acquisition of HotCold Studio by Grandstores.
Read: Dubizzle Group acquires UAE’s Property Monitor, marking third acquisition in two years
Dubai-based tech firms raise 96 percent of all funding
Dubai-based tech firms accounted for 96 percent of all funding seen by tech startups across the UAE in Q1 2025, establishing the city as the undisputed leader in attracting venture capital. Abu Dhabi followed at a distant second.
500 Global, Wamda Capital and Middle East Venture Partners were the overall top investors in the UAE’s tech ecosystem. Oraseya Capital, Plus VC and Endeavor emerged as the top seed-stage investors in Q1 2025. Meanwhile, QED Investors and Tech Invest Com led early-stage investments in the country during the same period.
While seed-stage investments declined, the dominance of Dubai in attracting capital, along with a strong uptick in acquisitions, highlights the growing maturity of the region’s tech sector.
