Seven Reasons Iran Could Become An Entrepreneurial Powerhouse

The headlines about Iran’s economy have faded, but the momentum hasn’t. The $400 billion economy, the second largest in the Middle East after Saudi Arabia, is expected to grow by almost 7% next year, according to the World Bank.

Consider what happens if you match that kind of economic growth with a university system that produces 233,000 scientists and engineers a year, in an environment newly connected to most of the world’s economy. The product could be thousands of startups and small businesses — if nothing gets in the way.

A couple of months ago I spoke to Nasser Ghanemzadeh, founder of Opatan, an Iranian cloud startup. He was in San Franciso attending a workshop organized in part by the venture capital firm 500 Startups.

“The most important thing we want is the expertise is the mentorship and the knowledge, ” he said. “ Most of the experiences are here in Silicon Valley.

“In the last three years, more than 200 startups have formed in Iran. A movement has begun. It’s accelerating.”

The business environment there still faces big hurdles. Whether the businesses thrive or not will depend in part on how much government policies support them, and whether geopolitical turmoil interferes with growth. Economic freedom and personal freedom usually go hand-in-hand.

But here are seven reasons to look to Iran to produce a generation of fast-growth companies.

The size of the economy and the lifting of world sanctions: The country has a population of nearly 80 million; and manufacturing capacity unrivaled in the Middle East. Oil and gas account for only 10% of the GDP, meaning the country has a diversified base to grow from. Most American sanctions remain in place, so we won’t see big American deals – but meanwhile, investments from companies in Europe and Asia are pouring in.

The population is highly educated: Some 9.4% has a tertiary education — that’s about 7.5 million people with a university education. “This is as large as the country of Jordan or Israel,” said Nadereh Chamlou, former senior advisor to the World Bank, at a recent event at the Washington, D.C.-based Atlantic Council’s Future Of Iran Initiative. (I listened to it, linked here online).

Iran has particular strength in tech fields: The country is home to a university known as the MIT of Iran. In Cairo a few months ago, the Iranian businessman Kamran Eliahian highlighted nanotechnology as nascent area of growth.

Despite the American sanctions, ties are forming between entrepreneurial communities in Iran and the United States. At the Atlantic Council event, Lily Sarafan, an Iranian American who is co-founder of Home Care Assistance, talked about iBridges conferences and TedxKish, a tech community gathering held on an island off Iran. Americans aren’t legally permitted to mentor Iranians, Sarafan said, but they can communicate.









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