BAKU, Azerbaijan, November 27. The establishment of venture investment funds in Azerbaijan is being thoroughly analyzed in line with international trends and the needs of the local ecosystem, the Innovation and Digital Development Agency (IDDA) under the Ministry of Digital Development and Transport told Trend.
According to the agency, active expansion of international cooperation and the creation of new investment funds in this field are expected in the near future.
“Expanding infrastructure, financing channels, and market access opportunities for startups remains one of our main priorities. At the same time, during the INMerge Innovation Summit held this September, a new venture financing mechanism called Tumar Ventures was announced together with the White Hill Capital fund, and a founding agreement was signed. The charter capital of Tumar Ventures is $1 million and will initially be financed by IDDA. An initial investment of $1 million is planned, and relevant negotiations are underway,” the agency stated.
The agency also highlighted investments already made by venture funds operating with its support. IDDA noted that its activities are built on five pillars shaped by global best practices and the needs of Azerbaijan’s innovation ecosystem.
“We can emphasize support for startup infrastructure, financing, and access to markets, along with the development of human capital and innovation culture within the ecosystem. Our vision for ecosystem building is based on these five fundamental principles. In terms of access to financing, the Caucasus Ventures fund, established in 2022 with the support of our agency, has assisted nearly 30 startups to date,” the agency said.
IDDA also outlined the incentive mechanisms and legal reforms being implemented to attract foreign venture capital funds to Azerbaijan. The agency emphasized that this work is progressing in two main directions.
“First, improving legislation and forming a suitable legal framework for venture financing. We are working closely with relevant state institutions on legislative reforms. Over the past three years, the agency has focused on updating regulatory acts and creating a transparent and favorable environment for investors.
Second, organizing international conferences and events to build global networks. In this regard, we actively host high-level innovation summits and events with the participation of representatives from both the public and private sectors. The INMerge Innovation Summit held in Azerbaijan is one of the most successful examples,” IDDA noted.
The agency also pointed to the capital placement model that supports mutual investment.
“As a clear example, for every $1 invested in Azerbaijani-origin innovative projects through Tumar Ventures, the Kazakhstan-based WhiteHill Capital venture fund allocates $2. This is being implemented within a joint investment promotion framework,” the statement said.
According to the statement, the agency plans to continue its activities in the coming years and is working on more open and effective mechanisms to attract foreign investors.
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