There is a lack of data due to low innovation activity and documentation

Most of the activity is centred in Tirana although some effort is being placed in Korca and Shkoder to replicate smaller scale local labs which will potentially feed larger organisations in Tirana.

Current Challenges

• No official business angels in Azerbaijan. Many businessmen in Azerbaijan invest rather in traditional business.

• corruption

• Only few startups in Azerbaijan are considering taking a loan from a bank as there are no clauses in the legislation that simplify lending for startups. Therefore, startups have to take consumer loans, since banks will not issue loans for the development of a startup. 

• Banks will more likely fund their own projects (intrapreneurship over entrepreneurship)

• There are only small grants

• The institution of investment is rather poorly developed in Azerbaijan. There are no local venture funds in the country due to gaps in the legislation, and foreign funds are not particularly keen on Azerbaijan. Azerbaijan is still, erroneously, considered as an offshoot of the Soviet Union. Due to these stereotypes, Azerbaijani startups have to register their projects abroad.

• Bottom line: The problem of funding for startups remains the main reason for the slow development of the Azerbaijani ecosystem.

      Source: https://startupuniversal.com/the-challenge-of-raising-capital-in-azerbaijan/