How to Value a SaaS or Technology Company in the UAE

By Bill Anderson, FCCA, Chief Executive Officer, Assetica · Published 2026-06-24 · Last reviewed 2026-09-23

Direct Answer: UAE SaaS and technology companies sit in a single indicative reference band of 8x to 15x normalised EBITDA. They are often priced on recurring revenue instead of EBITDA, where profit is deliberately reinvested. The top half of that band has to be earned, with evidenced retention and growth. The bottom is where month-to-month revenue, churn or one dominant customer puts a business, whatever the product looks like.

Need this done? Assetica values share options, RSUs and phantom shares under IFRS 2, starting from a supported ordinary share value and covering historic grants. See our ESOP valuation service →

Software is the one sector where pricing a business off revenue is defensible rather than a warning sign. Genuinely recurring revenue at high gross margin behaves like an annuity. The discipline sits in the word genuinely. Much of what UAE companies call SaaS is a services business with a subscription invoice attached, and buyers price that difference within an hour of opening the billing data.

This guide sets out the general framework. What recurring revenue has to look like to earn the premium. Which metrics move the multiple. When a revenue basis replaces an earnings basis. And the questions on intellectual property, employee options and jurisdiction that decide whether the headline number survives diligence. For the layer that applies to artificial intelligence businesses, see AI startup valuation in the UAE.

What is a UAE SaaS or technology company worth?

Technology and SaaS is one band, 8x to 15x normalised EBITDA, and the exercise is working out where inside it a business sits.

Treat these as reference points, not quotes. Where a business is priced on recurring revenue we publish no headline revenue multiple. UAE evidence for private software deals is thin, and importing a United States benchmark produces a number that cannot be defended. The full table of published sector bands sits in the UAE valuation multiples guide, with the reasoning in how many times profit a UAE business is worth.

Recurring revenue quality: contracted versus month to month

Not all recurring revenue recurs to the same degree, and sorting it is the first job in a software valuation. A buyer separates the revenue into bands before doing anything else.

• Contracted multi-year revenue, with a defined term, a notice period and often an annual uplift. This carries the premium, because next year arrives without being re-sold.
• Annual contracts renewing on a rolling basis, strong where the renewal record is evidenced, weak where renewal depends on one relationship manager.
• Month to month subscriptions, cancellable at will. Real revenue, valued more cautiously, because the customer re-decides every month.
• Implementation, customisation, training and hardware pass-through, which are carved out entirely and valued as services at services multiples.

The carve-out is where sellers lose value unexpectedly. A recurring figure that turns out to include onboarding fees, bespoke development and reseller margin does not get a slightly lower number. It gets re-based, and the conversation restarts from a smaller figure.

Net revenue retention and churn

Two measures matter and they answer different questions. Logo churn counts customers lost. Net revenue retention compares what the existing base spends this year against what the same base spent last year, after upgrades, downgrades and cancellations.

Retention above break-even, where expansion inside the base more than replaces what is lost, is what moves a UAE software business towards the upper band. It is also the number most often asserted and least often evidenced. A valuer asks for it calculated from billing data by cohort, over a period long enough to include renewals, with the definition written down.

Churn deserves the same treatment. Why do customers leave, do departures cluster in one segment or channel, and were the leavers the ones acquired most cheaply? A retention story with an explanation beats a slightly better number without one.

Gross margin, and what hosting and inference costs do to it

The annuity argument only holds while gross margin is high. Every dirham of cost of revenue reduces the amount of each subscription that reaches operating profit. In a business valued off recurring revenue, the margin assumption is doing most of the work.

Cost of revenue properly includes hosting and infrastructure, third-party data and licence fees, payment processing, and the support function that keeps customers live. Where the product uses machine learning models, it also includes the cost of running them.

That last item changes the shape of the model. Traditional software carries a cost of revenue that grows far more slowly than revenue, so margin improves with scale. A product calling a paid model on every user action carries a cost that moves with usage, and heavy users can cost more to serve than they pay.

A valuer therefore wants cost of revenue split by line, the trend across several quarters, and the position for the heaviest users rather than the average. Infrastructure spend sitting in operating expenses is reclassified before any margin is calculated.

Recurring revenue or EBITDA: which basis applies and when

An earnings basis applies where the business is established and profitable, and profit fairly measures what it does rather than how hard it is investing. That is the 8x to 15x band, with position set by retention, gross margin and concentration rather than the label on the product.

A recurring revenue basis applies where profit is being suppressed on purpose. A business spending heavily on engineering and sales to grow a contracted base is not unprofitable in any meaningful sense. Multiplying a small or negative earnings figure answers the wrong question. The test is whether the reinvestment is a decision the board could reverse, with the base continuing to renew if it did.

The failure case is a business unprofitable because the model does not work, asking for a revenue basis because the earnings basis is unflattering. The difference shows in retention and gross margin, which is why those sections come first.

Normalisation matters as much as the basis. Four adjustments move the number most. Development costs capitalised rather than expensed. Founders drawing below or above a market salary. Share-based payment. And one-off costs such as a re-domiciliation. Our article on business valuation methods explained covers how the approaches are cross-checked, and startup valuation for fundraising covers the pre-money and post-money mechanics for a raise.

Customer concentration in GCC software

Concentration is more common in Gulf software than in larger markets. Early customers are often government entities, banks or large family groups, and a handful can carry the revenue.

Those contracts are valuable and they are a concentration risk, and buyers price both at once. The questions are consistent. How much recurring revenue sits with the largest customers. Whether contracts survive a change of control. Whether termination for convenience exists. When the next re-tender falls. And whether the relationship belongs to the company or to a founder.

A change of control clause in a major contract is the item most likely to delay a software transaction here, because the counterparty consent process runs on its own timetable. In reverse, a contract renewed for a further term shortly before a sale moves the number more than most operational improvements.

Who owns the code: IP ownership and contractor assignment

A software business is largely an intellectual property holding, so a buyer's lawyers will test whether it actually holds it. This is where regional deals most often stall.

• Employees. Employment contracts should assign work product to the company. Where the standard contract is silent, the position is arguable, and arguable is expensive.
• Contractors and offshore development teams. Without a written assignment of rights, a contractor may retain ownership of what they wrote. Development outsourced to an agency needs the assignment in the agency agreement, and the agency needs it from its own people.
• The right entity. Code, domains and marks are frequently registered to a founder personally or to a predecessor company that was never wound up properly. Moving them later is a related-party transfer that needs a value at the transfer date.
• Open-source obligations. Copyleft components embedded in a proprietary product create obligations a buyer will want mapped before signing.

Where the technology or the brand is separable, it can be valued in its own right rather than absorbed into goodwill. That also matters for allocating a purchase price after an acquisition. See intangible asset and brand valuation and purchase price allocation under IFRS.

ESOP dilution and the price per share

Founders routinely quote a company valuation and then calculate their own proceeds from their shareholding on the register. Those two numbers rarely reconcile, because equity value is divided across the fully diluted share count, not the issued one.

The fully diluted count includes issued shares, vested and unvested options, the unallocated pool the board has reserved, and any instrument converting at or before the event. Convertible notes and simple agreements for future equity convert on their own terms, often at a discount. A note that converts cheaply takes a larger share of the same equity value.

The consequences are worth stating plainly:

• An unallocated option pool created before a round dilutes the existing shareholders, not the incoming investor, where the pool is agreed pre-money.
• Options priced below the current share value have intrinsic worth that belongs to the holders, and that value comes out of the price per share for everyone else.
• For financial reporting, share-based payment has to be measured and recognised, which requires a defensible valuation of the underlying shares rather than a figure chosen for convenience.

Our note on employee share scheme valuation in the UAE sets out how the share value underpinning a scheme is established, and what documentation a scheme needs to survive review.

DIFC, ADGM or mainland: what the structure does to investor familiarity

Jurisdiction does not change what a software business earns. It changes how quickly an investor can get comfortable owning it, which shows up in price and in time to close.

The Dubai International Financial Centre and Abu Dhabi Global Market both operate common law frameworks, with their own courts and registries. Both accommodate the share classes, option plans and shareholder protections that institutional investors expect to see. ADGM sets out its company formation and registration requirements on its setting up pages. Mainland companies licensed through the Department of Economy and Tourism raise capital too, though foreign investors sometimes spend longer on structural diligence.

Tax treatment is a separate question from investor familiarity, and should be confirmed rather than assumed. UAE corporate tax applies at 9 per cent above AED 375,000 of taxable income, and 0 per cent below it. A Qualifying Free Zone Person can access a 0 per cent rate on qualifying income, as set out by the Federal Tax Authority on its corporate tax pages. Whether a software company meets the free zone conditions depends on its activities and substance, so confirm with your tax adviser.

Our piece on the DIFC, ADGM and mainland jurisdiction question covers where the difference genuinely affects value. the DIFC startup and venture capital guide covers what investors in that centre look for.

Where this framework stops: AI businesses

Everything above applies to an artificial intelligence company, and it is not sufficient on its own. An AI business raises questions this framework does not reach. Whether the model, the data or the workflow is the defensible part. What rights exist over training data. How much gross margin inference consumes. And whether the advantage survives the next large model release.

Those questions sit in our guide to valuing an AI startup in the UAE. Read this framework first for the recurring revenue mechanics, then that guide for the layer on top. Businesses outside software with online revenue models are covered in e-commerce business valuation.

A worked example, and how to get the number tested

The figures below are illustrative, chosen with round numbers to show the mechanics. They do not describe any real company.

The gap between those two rows is the argument of this guide. The same earnings give a very different answer, depending on whether retention is evidenced from billing data or asserted in a deck. Capitalised development is removed too, because a business capitalising the engineering it needs to stand still reports profit it has not earned.

Enterprise value is still not the amount a shareholder receives. Borrowings, convertible instruments, deferred revenue treated as a liability and accrued end-of-service gratuity come off. Surplus cash goes on. The remainder is divided across the fully diluted share count. See enterprise value versus equity value for the bridge.

You can put an indicative range on the business in a few minutes with the Assetica business valuation calculator. Before a formal engagement, work through the business valuation readiness checklist and the valuation documents checklist. That way the billing exports, cohort data, contracts, cap table and IP assignments exist in a form a buyer can test.

Where an investor, an acquirer, an auditor or a court has to rely on the figure, the report must be prepared to recognised standards. Assetica works to IVS and the RICS Red Book, with IFRS 13 where the value feeds financial reporting, and neither audits nor brokers deals. From the day your documents are complete, a standard report takes five to seven working days. An expedited one takes two to three.

The multiple ranges and all worked figures in this article are indicative and illustrative. They are not a valuation of any business and should not be relied on for a transaction, a fundraising, a tax filing or legal proceedings.

Frequently Asked Questions

Speak to Assetica about Startup & Technology Valuation

Assetica is an independent business valuation firm in Dubai. We do not audit and we do not broker deals, so the number carries no conflict. Read more about startup & technology valuation, or book a scoping call. Standard reports are issued in five to seven business days.

Related Guides

• How to Value an AI Startup in the UAE: What Investors Actually Test
• Startup Valuation for Fundraising in the UAE: How Founders Set a Number
• Valuing Employee Share Schemes in the UAE and DIFC
• Startup and VC-Stage Valuation in DIFC: SAFEs, Priced Rounds and Fund Requirements
• What Increases and What Decreases Business Value: The Complete Guide to Company Value Drivers