The technology sector in the United Arab Emirates saw a remarkable increase in funding during the first quarter of 2025, according to Tracxn’s Q1 2025 UAE Tech Funding Report. The total amount raised reached $872 million, which marks a substantial 194% rise from $297 million in the previous quarter. Furthermore, this figure represents an impressive 865% increase compared to $90.5 million raised in the same quarter last year.

Late-stage funding was the main driver behind this growth, contributing $760 million to the total amount raised, which is a 660% increase from the $100 million reported in the fourth quarter of 2024. Key investors during this period included notable firms such as 500 Global, Wamda Capital, and Middle East Venture Partners.

The funding landscape indicates a maturing ecosystem, as the focus has shifted from early-stage experimentation to late-stage scaling. In Q1 2025, late-stage funding dominated with $760 million raised, while seed-stage funding dropped significantly to $23.4 million, reflecting a 77% decrease. This pattern aligns with trends seen in more established tech hubs, where investors increasingly concentrate on scaling proven business models.

The concentration of funding in specific sectors also shows strategic investments within the UAE’s tech ecosystem. Enterprise Applications emerged as the leading sector, securing $688.1 million, while FinTech continued to thrive with $215.6 million in funding. This trend highlights a deliberate strategy to build competitive advantages in specific verticals rather than competing across all technology categories.

Dubai stands out in this funding landscape, capturing 96% of all UAE venture funding in Q1 2025. This concentration is the result of intentional ecosystem development through regulatory frameworks, infrastructure investments, and initiatives like the “Golden Visa” program aimed at attracting talent. Dubai’s sustained dominance in venture capital reflects its status as a mature startup environment in the region, although balancing this concentration with the need for broader growth across the UAE remains crucial to avoid potential bottlenecks.