This brief can be cited as:
KAPITA. "Iraqi Startup Market: Unraveling the Untapped Opportunities”. September 18, 2023. https://bit.ly/47E8vXO
Many of the big businesses we know today were only ideas. Ideas that tackle real needs can become successful businesses if they are well invested in. Up-to-date Information and market knowledge can definitely be advantageous, especially in this rapidly progressing era when data is highly valuable and being informed can significantly increase a business’s success rate. As a result, gaining some understanding of the Iraqi entrepreneurial roadmap from different angles can definitely inspire new business ideas and contribute to the development of emerging startups. This brief explores the Iraqi demographic statistics and economic indicators; a detailed description of entrepreneurial ecosystem enablers; the Iraqi startup scene in terms of business ideas and granted financial investment; challenges hindering the Iraqi private sector.
To begin with, it is important to gain some background demographic statistics of Iraq. Iraq is the fourth largest population among the MENA region counties with 43.5 million people; children and adults make up around %60 of the total population, which by far are the most dominant groups. Higher population concentration is in the urban cities, which is about %70.
In terms of economic indicators, Iraq is the fifth largest GDP among MENA region countries. The oil sector is the major financial contributor to the Iraqi economy while the agricultural and industrial sectors have not received the proper attention or investment. As a result, the manufacturing Industries across the spectrum have suffered neglect and lack of investment over the years, which created a highly import-dependent economy.
Halfway through, this brief covers the growth of the Iraq entrepreneurial ecosystem over the past years, especially in business development programs as they evolved from startup weekends to business-oriented programs.
We also explore the rise of startups across the Iraqi market according to their market targets. For instance, Miswag is an e-commerce with around 15,000 products and a delivery service. Talabatey is a food delivery service coving up to 1,000 restaurants. The entrepreneurial scene has witnessed other startups in healthcare, agriculture, and education.
This brief provides details of the investment scene in Iraq. There have been about 16 rounds of investments since 2019, targeting startups that incorporate technology in their operations. Data shows that delivery service and E-commerce startups were the centers of interest as they received higher numbers of investment rounds. This brief highlights the investors’ scene regarding background information and investments
We also highlight the private sector’s environment that does not fully empower nor provide the proper mechanisms for growth. The private sector faces many challenges, such as limited financial accessibility, lack of banking development, and laws and regulations obstacles. This brief addresses the root causes of these challenges.
By the end of this brief, we address the lack of market knowledge issue. Lack of data and trusted information resources have been an issue in the last several years. Therefore, Some institutions, such as Kapita, The Station, 51Labs, and Iraqi Innovators have taken a significant role in solving this issue by providing relevant market knowledge and research through their publications, newsletters, and other activities.
We conclude with recommendations that aim at creating a better working environment for entrepreneurship and startups through the government and stakeholders’ efforts. The goal is to promote entrepreneurship, support startups with resources and training, and provide access to financial and government facilities.