A partnership between Omid Entrepreneurship Fund and Iran ministry of communications has taken place to further support Iranian startups.
In the past years, governmental arms have witnessed the potential which startups hold in creating jobs for the youth, boosting the economy and the overall potential Iran has in this sector. “In this agreement, Omid Entrepreneurship Fund is responsible to support the startups that are introduced by the ministry of communications in order to further develop Iran’s entrepreneurship ecosystem and boost job creations in the private sector,” told Samimi the head of technology development of ministry of communication to Tasnim News.
This initiative will provide low-interest loans to startups within a five year period. 10 Billion of this 15 Billion Tomans ($4.5 million) fund is provided by Omid Entrepreneurship Fund and the other 5 Billion is covered by Iran Ministry of Communications and Technology for the sole purpose of supporting startups.
Samimi continued to explain how this loan is distributed to startups. “Majority of this fund will provide for startups that are in technoparks, incubators, and accelerators which are introduced to us by these organizations. The other part of this loan will be in reach of companies inside universities which have at least one university profs active inside the company.”
The maximum amount of each loan is 100 Million Tomans (around $30k) with a low-interest rate. A comity has been formed to take over the processes of due diligence of the companies these loans will be given to.
Another announcement from this initiatives was in the gaming sector to support Iran’s game developers. The national computer game foundation will be partnered in this initiative to further support Iran’s gaming industry which will also benefit from this loan.
Samimi also stated that around 104 Billion has been promised to be given to technology companies in IT and ICT sector.
Now some would say 100 million Tomans or $30K is not a number that would run a startup’s engine. The current pre-seed fund provided by Iranian accelerators are around 8-15k which gives a sense of how much a pre-seed/seed stage startup needs to operate in Iran. Operation costs in Iran are low enough to take this loan as a consideration especially because of its very low-interest rate and its 5-year long loan span.
One of the brightest sides of such announcements is the support wave coming from the government to Iran’s startup scene. The current government is starting a wide range of initiatives to further support Iran’s entrepreneurship movement. The most noticeable governmental support until now has been on incubators, accelerators and VCs which can be considered as the most noticeable and evident supports from the government.
Though loans are not the best source of capital a startup needs especially seed stage startups, these acts could be a spark of many upcoming supports coming from the government.