SMEs in the UAE are feeling the pressure from softer consumer spending and a decline in visitor arrivals.
Current conditions may be delaying new funding rounds, but family offices are finding new opportunities closer to home within UAE SMEs.
Sector Specific Impacts
As one operator put it: “I am in the events industry [the worst industry to be in during a war conflict], we are pivoting and not sitting and waiting.”
Art Dubai has been moved to May whilst Token2049, the largest annual crypto gathering in the GCC, is delayed. Oxford Economics estimates that even with a quick end to the conflict the Middle East is facing an 11 to 27% drop in visitor arrivals this year against a forecast of 13% growth in FY26.
Events across the UAE, including government-led ones, have largely been postponed to later in the year with expectations of a sharp rebound: “there will be 3 to 4 events daily in September to December,” said Obediah Ayton, Chairman of the Family Office Club.
Cash Flow First
At the same time, family offices are showing a clear and consistent preference for high cash flow business. “The good thing about family offices is that they like business, trade and making cash. This mindset is shaping how capital is being deployed in the current environment,” said Ayton.
Rather than backing early-stage, cash-burning ventures, family offices are increasingly using SMEs as operational tools to reduce costs, improve efficiency, and localise supply chains at a time when big corporations work remotely.
UAE-based banking and tech companies are largely working remotely although operations remain fully open. Snapchat recently extended work-from-home until the end of April citing a global security review according to sources inside the tech firm.
SME Shift into Action
SMEs are well-positioned to navigate the crisis in the right sectors: “SMEs who have stayed resilient in the UAE, must see this as an opportunity with the family offices to show them they can be relied on,” said the Chairman.
This shift is already visible in recent deal activity. UK-based healthcare SME ‘The Home Hospital’ secured investment from a Dubai-based family office following its UAE expansion in the six months up to the outbreak of war whilst ‘Ecoblox’ signed a contract with a major Dubai family office and wealth tech platform ‘Masttro’ secured a software deal with a Dubai-based multifamily office.
All transactions occurred six months before the outbreak of war on 28 February. These examples reinforce a broader theme: “Families think business first… over a NASDAQ IPO,” at a time when cash flow matters more than speculative risk.
Selective Investor Appetite
Investor appetite remains although selective to local cash flow.
One inquiry this week shows that activity remains: “today, I had a message from a UK based family office in DIFC looking for cash generating industrial assets, EBITDA between £5M and £10M, earlier this week.
The message is consistent across the board: profitability, resilience, and operational substance are now prerequisites. “The request we have had are positive EBITDA and profitable. No one has come with us asking for Pre IPO SpaceX.”
Business Fundamentals than Speculation
High valuations or speculative funding rounds is unlikely to resonate. Instead, the focus must return to core business fundamentals: strong products, reliable service delivery, and sustainable margins.
“The start up who is running around asking for cash will not do well in this environment. The SME must think business first and cap table investment later,” said Ayton.
At a structural level, family offices are also becoming more locally focused. As they seek to preserve capital and ensure operational reliability, there is a growing preference for partners who are geographically closer and able to respond quickly.
“Family offices will adopt more to ‘local’ SMEs as they look to preserve cash and find new reliable sources… those who can actually come to the office to solve problems.” This trend could accelerate in the near term, particularly before international business activity fully rebounds.
Tech and Family Offices
Technology is also reshaping how family offices operate and make decisions. Platforms such as AlphaSense and PitchBook are increasingly being used to source opportunities across both private and public markets.
At the same time, wealth management systems like Masttro and Addepar are enabling real-time visibility on liquidity and performance, streamlining reporting to ultimate beneficial owners and allowing leaner teams to operate more efficiently.
Taken together, these dynamics point to a more pragmatic investment landscape. Family offices are not retreating—they are recalibrating. The emphasis is firmly on cash generation, control, and long-term value creation rather than short-term hype.
For UAE SMEs, the implications are clear. Survival in the near term depends on reliability and profitability as this period may offer a rare window to build lasting partnerships with long-term capital.
Those SMEs that can navigate this phase are likely to emerge in a significantly stronger position.
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