BAKU, Azerbaijan, March 28. Uzbekistan's Startup Garage, a pioneer in nurturing the region's startup ecosystem, is setting its sights on Azerbaijan as a key partner for cross-border collaboration and expansion, founder of Startup Garage Mukhammad Khalil told Trend in an exclusive interview.
“Azerbaijan and the broader Caucasus region are strategic next steps for Startup Garage. The market bears similarities to Uzbekistan - young entrepreneurs, rising investor interest, and government-led innovation programs. We are already in early discussions to explore cross-border accelerator programs and VC collaborations that will further strengthen regional startup connectivity,” he said.
According to him, the company aims to facilitate cross-border startup growth, investment, and technological collaboration between Central Asia, the Middle East, and the Caucasus. Inspired by the renowned Startup Garage program at Stanford University, the platform is designed to provide entrepreneurs with the resources to turn innovative ideas into successful scalable businesses.
“The Uzbek startup ecosystem is growing rapidly, with an annual growth rate of more than 20 percent. While access to larger markets had been limited until recently, 2024 marked a significant milestone. The country climbed 88 places in the global rankings, reaching the 110th position, surpassing countries like Ethiopia. Uzbekistan benefits from a demographic framework conducive to a strong startup ecosystem, with a population of 37 million, a 2 percent annual growth rate, and a young, tech-savvy population with an average age of 29 and near 100 percent literacy,” Mukhammad Khalil noted.
He also highlighted the Uzbek government’s comprehensive support for startups, which includes providing incentives for international accelerator participation and favorable loan terms for startup founders. The launch of the President Tech Award, which recognizes the country’s most promising technology projects, is another key step in fostering innovation. The second wave of the competition, held in December 2024, attracted over 550 startups, with winners receiving prizes totaling $1 million.
“The Uzbek startup ecosystem is particularly focused on several sectors, including fintech, edtech, e-commerce, AI & automation, healthtech, proptech, and renewable energy. There is a wide range of innovative projects emerging across these industries. In fintech, there is a growing focus on digital payments, Buy Now, Pay Later (BNPL) solutions, neobanking, and financial products designed for small and medium-sized enterprises. In the edtech sector, AI-driven personalized education, online learning platforms, and hybrid learning models are gaining traction,” the founder of the company emphasized.
He added that the e-commerce and marketplace sector is evolving with B2B and D2C models, AI-powered product recommendations, and social commerce. Meanwhile, AI and automation are gaining ground with the development of SaaS solutions for businesses, process automation, and generative AI applications. In the healthtech field, telemedicine, AI-driven diagnostics, and healthcare SaaS platforms for clinics are emerging as key innovations. Lastly, in the renewable energy sector, there is a focus on smart grid solutions, energy efficiency innovations, and carbon credit tracking.
Mukhammad Khalil emphasized that the government’s efforts to improve the business environment in Uzbekistan have significantly benefited startups. These reforms include currency exchange liberalization, tax reform, and simplifying business procedures. Startups are eligible to recover up to 50 percent of their key expenses, up to $20,000, for participating in international accelerators and entrepreneurial courses, which also includes airfare and accommodation costs. Moreover, startup founders with a well-defined business plan and a transparent credit history can access favorable loan terms. These include loans of up to 300 million soums ($23,151) with a repayment term ranging from 6 months to 3 years, and interest rates set below standard market levels.
“Startup Garage is making significant strides in expanding its operations into the MENA (Middle East and North Africa) region. Recognizing a strategic gap, Startup Garage is the first to establish a structured program aimed at connecting Uzbek founders with the GCC's (Gulf Cooperation Council) venture ecosystem, corporate partnerships, and regulatory pathways. This move aims to accelerate the growth of Uzbek startups in MENA markets and strengthen regional collaboration. Beyond MENA, we’re looking at Azerbaijan and the broader Caucasus region, where similar market dynamics create promising opportunities,” he said.
According to him, the goal of the MENA initiative is to help more than 100 Uzbek startups scale into MENA markets over the next three years. As part of the expansion, Startup Garage will assist founders with company registration in the UAE, Qatar, or Bahrain, offering support for navigating the regulatory landscape. The initiative will also provide in-depth market entry strategies, helping startups establish connections with key sales channels. Additionally, Startup Garage will facilitate partnerships with prominent MENA VCs and strengthen local networks, and foster collaboration. In line with this expansion, Startup Garage has already held discussions with the Qatar Development Bank (QDB) and Qatar Science & Technology Park (QSTP) to create cross-border incubation programs, further enhancing the region's innovation ecosystem and supporting the internationalization of Uzbek startups.
“With a young, tech-savvy population and increasing venture activity, Uzbekistan presents an untapped opportunity for early-stage investors. The Startup Garage ecosystem, along with Aloqaventures, is accelerating this momentum by providing capital, mentorship, and market access to high-potential startups. This year, Aloqaventures is investing about $8 million to early-stage startups,” he underscored.
Mukhammad Khalil noted that the Uzbek government actively supports startup globalization efforts through initiatives like IT Park Uzbekistan and Ministry of Digital Technologies grants and export facilitation programs. Moreover, diplomatic and trade ties between Uzbekistan and MENA nations are growing, paving the way for easier business integration. Startup Garage works closely with local ministries and economic development agencies to leverage these frameworks.
“We continue to expand Startup Garage Founders School, our 8-week intensive accelerator for startups in Uzbekistan and beyond. Beginning on April 7, the program is open to both new and experienced entrepreneurs looking to validate their ideas, develop a minimum viable product (MVP), enter the market, and secure early-stage investment. The most promising startups from the program will be invited to join Startup Garage’s residency program and will be eligible for an initial investment starting at $10,000. Founders School is where experienced founders mentor the next generation, focusing on execution, adhering to global standards, and leveraging local expertise. Our goal is to teach over 1,000 people this year, empowering the most promising startups to grow and secure international investment. As of early March, more than 200 young people have signed up for the program. The participants will receive real startup knowledge, hands-on mentorship, and direct, professional relationships with potential investors and partners such as Aloqa Ventures, which actively invests in local startups and supports the Uzbek startup ecosystem,” he said.
He concluded that the country needs to accelerate ecosystem-building efforts. He identified three key areas that need further development to help Uzbekistan achieve its first unicorn: more venture capital inflows, stronger cross-border market access, and greater corporate involvement in startup partnerships.
