Because of the sanctions, Iranian startups had no choice but to play in their own backyard, and forget about expanding. Putting aside the fact that Iranian companies usually weren’t allowed to officially operate in western countries, the biggest issue for Iranian startups that had international users, was the lack of payment portals for international users.
Startup had to provide its service free of charge, as there was never a way to charge clients and users. Now that the sanctions are lifted, Iranians well soon get access to official international bank accounts, Paypal, and the ability to wire money internationally. The root of the problem came from Iranian banks, as they were cut off from the international banking system, . As of January 17th sanctions on the Iranian banking system has been lifted, and Iran has also obtained the right to access its frozen assets outside the country. Delegations from european banks are already in talks with Iranian banks. We anticipate in a matter of months Iranians would have access to credit cards, and companies and startups will have international payment portals.
Typically, in order to have an online payment portal for non-Iranian users, a startup would have to (somehow) register its company in another country where that was possible. This action also comes with many risks and challenges as many countries don’t allow an entrepreneur with an Iranian citizenship to register a company in that specific country. After passing the obstacles and successfully registering your startup in that country, your startup could then get paid from users and other companies easily.
Some Iranian startups like Taskulu and Faranesh (A local Udemy) which have international users had to duel with this problem for a long time. Taskulu had to open an office in Singapore to provide payment options. And Faranesh uses alternative methods to get paid from their farsi speaking users from Afghanistan and Turkmenistan.
When there’s opportunity, there is action. Sanctions being lifted will definitely inspire Iranian entrepreneurs to think beyond their local market and have wider ambitions to go global. Farsi speaking countries such as Afghanistan and Turkmenistan would become available to startups that have language barriers in order to expand. Shipping to other countries will also become easier, giving Iranian e-commerce players have more room to play in the middle east.
The last untapped emerging market has officially opened up to the world, creating an influx of investors in the country. VCs and super angels are paving their way to Iran looking for promising deals. This will give Iranian entrepreneurs access to foreign capital which will make it easier for them to expand to other international markets with the help of their foreign shareholders. Three new foreign funds are planning their entry to Iran as we speak.
Though the Iran deal is sealed, and the days of implementing the deal is upon us, time is required to see the effects of it on Iran startup ecosystem. Now that the sanctions are no longer obstacles, Iranian companies at this stage can start plan their expansion strategies. In 2016, we hope to see more Iranian startup targeting international markets, and to see more Iranian brands globalizing.
[Update]: Due to the fact that only european sanctions have successfully lifted, and American sanctions on working with Iranians are still in place, companies like Paypal can’t provide their services to the Iranians yet. and credit institutes like Visa, MasterCard and American express can not be in contact with Iranian banks directly unless european banks act as middle men. We have to wait and see if the sanctions coming from the USA on working with Iranian companies would get lifted in the upcoming months, or not.