How DMCC Crypto Center Strives to Help Web3, Crypto Startup
The Dubai Multi Commodities Center (DMCC) was founded as a startup in 2003 with 28 member companies. Today it is one of the world’s leading free zones with over 21,000 member companies from 180 countries, employing more than 65,000 people.
Led by Ahmed Bin Sulayem, Executive Chairman and CEO of DMCC, in 2022 alone, the company registered over 3,000 companies with it.
Recently, DMCC partnered with SafeGold and Comtech Gold to tokenize gold bars based in UAE facilities.
Furthermore, its crypto arm is DMCC Crypto Center— is home to over 500 crypto companies, representing the largest concentration of crypto and blockchain companies in the Middle East and North Africa (MENA) region.
The crypto center has partnered with Brinc, a Hong Kong-based global venture capital firm, to provide access to its $150 million accelerator to support Web3 and blockchain technology companies.
The DMCC Crypto Center offers a unique environment that a crypto business needs to succeed:
- Access to capital through global investors
- Local and global talent
- A complete suite of crypto licenses that make doing business easier
- A network of like-minded businesses and entrepreneurs
In a recent conversation, YourStory Gulf Issue spoke with Belal Jassoma, Head of Business Development, DMCC Crypto Centre, who discussed how the firm is helping Web3 and blockchain companies in the MENA region.
Belal, a civil economist graduate from the American University of Sharjah, started his career in the real estate sector in 2006 and joined DMCC in 2011.
Edited excerpts from the interview:
YourStory Gulf Edition [YS Gulf]: From real estate to DMCC, how has the segment evolved and grown?
Belal Jassoma [BJ]: Since I joined DMCC, we have grown from strength to strength. The average number of new businesses we used to attract would be 1000 to 1500. In 2021 we registered 2500 businesses; it was a record. This year we broke that record with over 3,049 companies. It is outstanding.
The reason we are growing is because of our diversity and our focus on growing ecosystems, creating sector-specific ecosystems.
Anyone can issue a license or registration, but those that create a sustained competitive advantage for startups and businesses to value and hold onto help their growth.
YS Gulf: How do you maintain this consistent growth?
BJ: It’s always about looking at what happens next. It’s about being early on in recognizing a sector’s potential and quickly organizing what the sector needs – the environment startups need and what will help them flourish and grow.
YS Gulf: Which sectors have you seen growing since 2011?
BJ: The main purpose of the DMCC was to develop trade, especially the merchandise trade. The majority of the companies were in the commodity segment. But we saw a lot of potential and opportunities in the technology sector.
To build a diverse ecosystem, we added a focus on technology, as we cannot have commodity companies working in silos. We need everyone to have a comprehensive, self-sustaining community and ecosystem, and one of those things is scaling up capabilities.
We partnered with AstroLabs in 2013 to launch and scale startups and companies registered with DMCC. Starting with one program every couple of months to a dedicated space that AstroLabs took away from us, today we have one of the most successful and attractive technology hubs in the region.
YS Gulf: Dubai is now becoming synonymous with Web3, blockchain, crypto and Metaverse. How is DMCC working towards it?
BJ: We have many projects that we champion. But our main role is to build a bridge between ordinary companies and traders. More than 50% of our companies are in the trading industry.
We were early to recognize the potential of blockchain and crypto in 2016. It has the potential to increase commerce and take it to the next level, which is our mandate.
The idea is to connect blockchain companies with trading companies to see more adoption and build more projects in the segment.
YS Gulf: Tell us about DMCC Crypto Centre. How has it grown and developed?
BJ: In the UAE, we were the first to create a home for crypto and blockchain companies. We created a framework and licenses for crypto trading and DLT services, and no one else offered them in the region. We have now extended it to the NFT market.
Today it is more blockchain and Web3 instead of crypto and mining. We have seen demand grow. In 2020 we wanted to build a dedicated center for companies in that area and we opened the DMCC Crypto Center in 2021.
YS Gulf: The sector is in its nascent stage and there are cases like the FTX crash. How does this affect startups in the sector and the centre, specifically?
BJ: Considering that a large part of our companies are in the trading segment, we monitor closely [FTX] history and the impact it can cause.
But from day one, the DMCC Crypto Centre’s focus has been on member companies building projects on Web3 and blockchain technologies.
Many exciting projects are in the pipeline, including Metaverse games, educational technology on the metaverse, and music streaming on the blockchain. We also focus on blockchain technology for sustainability and healthcare.
This is business as usual for us, despite what is happening in the market.
YS Gulf: How do you reduce or avoid errors?
BJ: If you look at the statistics, about 70-80% of startups don’t make it past their fourth year. So there is no harm in trying. I mean, it’s a new room. Unless you try, you will not see success.
Several projects start on a small scale. A good example is tokenization. We have companies that want to tokenize real estate. Furthermore, many companies have tokenized gold and assets and physical assets to actualize these assets. We can get more ownership opportunities for them.
We also have an in-house team – a dedicated team of crypto experts – who support these companies and see the business cases that come to us and what might work.
YS Gulf: How can companies from different parts of the world find a place at DMCC’s crypto center?
BJ: Close to 17% of the 500 companies we have at the crypto center are from India. It is the highest nationality we have in the centre.
We are also expanding our international presence through representative offices, which will have local staff. We want to explore and understand the market opportunities; the benefits of setting up an office and having someone speak the local language and work in that time zone and support them locally.
More importantly, our process is 100% digital and paperless, making it easier for companies, especially startups, to establish businesses in Dubai.
Also, transaction speed is important. Companies can set up operations in their country without even having to come here, and they can come to Dubai when they are already up and running and ready to do business.
YS Gulf: What are the benefits?
BJ: First and foremost, access to financing. We have accelerator and incubator programs running all the time. Besides, we also have a fund of 150 million dollars set up by Brinc.
For Metaverse, we have access to local and global talent – both for cryptogaming and technology.
We also run regular networking and knowledge sharing events and programs not limited to the crypto and blockchain sector, but for DMCC’s 22,000 member companies.
We also play a role in matching peers and creating opportunities for collaboration. Last but not least, we have many sector-specific ecosystems that offer dedicated co-working spaces.
Crypto and Web3 are one of them. We have a gaming center for gaming and e-sports businesses and a sports and wellness center. We also have a dedicated space for AstroLabs. Soon we will launch a dedicated space for the start-up of e-commerce.
YS Gulf: How have you seen the market develop for startups?
BJ: With all the ups and downs, there will always be new businesses establishing themselves. When big companies lay off great talent, these skilled professionals continue to deliver and do business and build companies. They join us as new startups and start new businesses.
Across the board, we have seen all sectors grow. For example, the renewable energy sector gains more interest when energy prices rise. We have seen several family offices set up shop here.
Moreover, due to the regulatory environment, the advantages Dubai offers, and bank on the security and stability of their office, we have seen more holding companies using Dubai as their base.
YS Gulf: How do you see Web3 and the Metaverse ecosystem growing and evolving?
BJ: In our view, the future of technology is blockchain. We are seeing more blockchain innovations coming to Dubai and witnessing an increase in more innovative technologies.
What’s important is to stay on top of it and gauge what these companies need – the regulatory environment and financial incentives they need to thrive.
YS Gulf: What does 2023 mean for DMCC and DMCC Crypto Centre?
BJ: More initiatives and projects are coming up for DMCC’s crypto and gaming centers. We have expansion plans as demand increases. We will also focus on more incubation, acceleration and funding for startups.
In fact, we focus heavily on education and member engagement, especially in the blockchain and Web3 space. We aim to strengthen and improve our platforms and ecosystems to make it better and easier for our members to scale up their business. More importantly, we want to encourage the use of blockchain in the mainstream.
YS Gulf: What advice would you give startup founders?
BJ: The first thing that comes to mind is to do proper research. Always consider exit strategies. It doesn’t have to be an exit from the business, but your scale-up options and exit plans in case things don’t work out. Be prepared for it.