The role of multi-stakeholders intervention in the sustainability of digital start-ups CASE OF AZERBAIJAN Rauf Jabarov Director, Electron Government Education and Training Center, under the Ministry of Transport, Communication and High
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Presentation Transcript
01
The role of multi-stakeholders’ intervention in the sustainability of digital start-ups
CASE OF AZERBAIJAN Rauf Jabarov
Director,
Electron Government Education and Training Center,
under the Ministry of Transport, Communication and High Technologies of Azerbaijan Republic
Oxford, 09 October 2017<br>
02
Content 1.
2.
3.
4. Start-up ecosystem in Azerbaijan
Start-ups sustainability
Multi-stakeholders’ intervention
Supports for start-ups
Problems and challenges 5.<br>
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Azerbaijan and startup ecosystem<br>
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Azerbaijan and startup ecosystem<br>
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The goal of this talk How can digital start-ups contribute to economy if they are not sustainable business?
What are the reasons of startups’ unsustainability, in other words, why are they not enough successful in developing countries?<br>
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Research focus To what extent Azerbaijan startup ecosystem is a supportive system for startups?
Analyzing all supportive stakeholders from startup environment by looking at the intervention of the support process.<br>
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Analytical framework<br>
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Analytical framework "If we do not know what start-up needs,
then we do not know how to support them”<br>
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Stakeholders form startup environment<br>
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Multi-stakeholders support Support forms:
Legal/institutional; financial/economic; human/social; Technology/infrastructure
Single online window or one-stop shop for acquiring license or permit Simplified tax regime through all country for SMEs
Free tax zone in techno parks
Simplified system of business registration, business licensing and permits Real provisions Challenges No regulation on innovation
No regulation for venture
Lack of Intellectual property protection
high rate tax for later stage (20% profit tax)
No institutional intermediaries – lack of embeddedness<br>
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Financial / economic support Opportunities
Grants for early stage
77 start-ups received more than $1M in total from 2013 till now from state funds National Fund for Entrepreneurship Support provides bank loans with low interest rate (though the number of digital start-ups is few)
Science Development Fund and State Fund for Development of IT provide grants for digital start-ups Real provisions Challenges High interest rate
No specified bank loans for SMEs
No VCs in the market
Weak access to VCs in abroad
Lack of later stage funding
Lack of stock market
Small market size<br>
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Opportunities
Graduates from IT schools
10 start-up competitions each year
Mentoring support in 6 University based incubators
Coaching in 3 acceleration programs ADA university, State Oil and Industry University, Engineering University and Technical University recently established IT and engineering schools.
Government, NGO and private companies (Telecom) arranged start-up competitions
Universities and private companies established business incubation and acceleration programs Real provisions Challenges Lack of IT skills
Lack of qualified engineers
No sufficient support by Competitions
Incompetency start-up teams
Lack of entrepreneurship mind
Lack mentoring and coaching Human / social support<br>
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Opportunities
3 state owned techno parks
6 university based business incubators
Free access to ICT infrastructure Government accepts techno parks as a main infrastructure support for digital start-ups
Techno parks and business incubators provides discounted services, free access to ICT, fiscal benefits Real provisions Challenges No technology transfer centers
Lack of resources in R&D centers
No spin-offs and spill-overs
No access to R&D results
No access to big data Technology / Infrastructure support<br>
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Challenges<br>
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Challenges – intervention gap lack of capabilities and initial resources
Poor readiness level to achieve business success in short period of time
Incompetence financial illiteracy to rise investments from global and local VCs
Few number of globally targeted disruptive ventures (e.g. lack of vision)
Weakness of entrepreneurship mind, venture management experience Unsatisfied needs (start-up side problems) Insufficient support (stakeholder side problems) Inconsistency of legislation system
Poor STI policy
Lack of institutionalization and poor stakeholders coordination does not lead to successful multi-stakeholder approach
State and private venture investment instruments not adopted for large, later stage, risky investments
Non existence approach to build spin-offs and/or spill-overs
Techno park/incubation infrastructure do not carry out all required support forms<br>
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Weakness of multi-stakeholder approach<br>
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Thanks for attention r.cabarov@mincom.gov.az
www.linkedin.com/in/rauf-jabarov/<br>
