State Scheme to Finance 100 Startups Annually

EghtesadOnline: A group of state institutions has launched an initiative to grant financial support to 100 startups per year to help them flourish.

News ID: ۷۴۹۷۴۴

19 February 2020

Comprised of the Vice Presidential Office for Science and Technology and its affiliate Iran National Innovation Fund, along with Barkat Ventures, a subsidiary of the Executive Headquarters of Imam's Directive, the team started work on the identification and evaluation of startups on Sept. 23, 2019, Peivast reported.

Mohammad Yar-Ahmadi, the initiative’s public relations official, told reporters that the scheme is aimed at financing each eligible startup team with 5 billion rials ($34,700), according to Financial Tribune.

"Since its inception in September 2019, 280 startups have submitted applications for financial support. After assessment processes were conducted in December 2019, five startup teams were shortlisted to receive funds," he said.

The three state entities are also set to offer training courses to those who were excluded during the evaluation.

"The courses will teach tech teams the know-how of bug detection and how to fix their business models or ideas and return to the assessment cycle," Yar-Ahmadi said, adding that private investors are also welcome to make joint investment and contribute to the growth of fledgling startups.

Stressing that the initiative is not limited to Tehran, Yar-Ahmadi said similar projects are being planned by the provincial branches of INIF in Hamedan, Isfahan, Fars, Yazd, Khorasan Razavi and Sistan-Baluchestan. He did not elaborate.

The government is optimistic that giving financial, technical and spiritual support to knowledge-based firms can help them expand their businesses and help the country materialize a digital economy.

To this end, establishing efficient workplaces with the help of professional mentors and investors has been on the government's agenda for years.

Startup Factory in Shiraz

The most recent attainment in this regard is the upcoming partial inauguration of a tech center, referred to as Startup Factory, in the southern province of Fars.

Co-organized by the vice presidential office, Information and Communication Technologies Ministry and Fars Governorate, the factory has been established in an abandoned one-hectare, two-story building once used by the Iranian Telecommunications Manufacturing Company.

The first phase of the construction project is almost complete and will soon be inaugurated.

Reports say that with the launch of the first phase, the factory will provide workplaces for around 700 people. When fully operational, the center's capacity will double.

Work on the project began in February 2019 and it was supposed to come on stream last October, but its inauguration has been postponed for unknown reasons.

Growing Trend

The establishment of tech centers and innovation factories has gained momentum across Iran over the past several years.

The move has accelerated since President Hassan Rouhani began his first term in office in 2013 and focused on extending greater support to new startups and technology firms.

Over the past few years, numerous tech parks have been established throughout the country.

Naturally, the Iranian capital city, Tehran, pioneers the trend with two innovation factories.

The first of its kind in the metropolis, dubbed Azadi Innovation Factory, was launched in August 2018 at an abandoned chemicals factory near Azadi Square, west of Tehran. The center is backed by the vice presidential office and is managed by Sharif University of Technology.

Highway, the capital's second innovation factory, is under construction. The factory is being established in an old building near Nobonyad Square in northeastern Tehran.

Besides Tehran, the vice presidential office has financed several other innovation factories in Iranian metropolises to expand the startup and knowledge-based ecosystems.

According to Qaderifar, innovation factory projects in the provinces of Markazi and Fars are almost complete and will become operational in the coming months.

The Roads and Urban Development Ministry, municipalities and governorates in the host cities are assisting the vice presidential office in implementing these projects.

At the innovation factories, startups and knowledge-based companies find legal, technical and financial support to expand their activities.

Bright Resume

The government is optimistic that support can help tech firms expand their businesses and consequently curb the country's reliance on oil-based revenues.

Sattari said Iran has more than 4,700 knowledge-based companies, which have earned 1 quadrillion rials ($7.4 billion) from the export of technological products in the first half of the current Iranian year (started March 2019).

The income has been on an upward trajectory over the past several years, increasing from 600 trillion rials ($4.4 billion) in the fiscal year ending March 2018 to 900 trillion rials ($6.6 billion) last year, he added.

Sattari emphasized that the figures prove that the solution to economic hardships facing Iran today can be found inside and not outside the country.