The Key to Azerbaijani Startup Growth: Innovation In The Energy SectorThe Key to Azerbaijani Startup Growth: Innovation In The Energy SectorThe Key to Azerbaijani Startup Growth: Innovation In The Energy SectorThe Key to Azerbaijani Startup Growth: Innovation In The Energy Sector
  • Country Guides
    • View all
    • Add Country
  • News
    • Global Newsfeed
    • Original Content
    • Add Post
  • Database
  • About Us
    • Mission/Team
    • Contact Us
  • Sign In
  • en English
    af Afrikaanssq Shqipam አማርኛar العربيةhy Հայերենaz Azərbaycan dilieu Euskarabe Беларуская моваbn বাংলাbs Bosanskibg Българскиca Catalàceb Cebuanony Chichewazh-CN 简体中文zh-TW 繁體中文co Corsuhr Hrvatskics Čeština‎da Dansknl Nederlandsen Englisheo Esperantoet Eestitl Filipinofi Suomifr Françaisfy Fryskgl Galegoka ქართულიde Deutschel Ελληνικάgu ગુજરાતીht Kreyol ayisyenha Harshen Hausahaw Ōlelo Hawaiʻiiw עִבְרִיתhi हिन्दीhmn Hmonghu Magyaris Íslenskaig Igboid Bahasa Indonesiaga Gaeligeit Italianoja 日本語jw Basa Jawakn ಕನ್ನಡkk Қазақ тіліkm ភាសាខ្មែរko 한국어ku كوردی‎ky Кыргызчаlo ພາສາລາວla Latinlv Latviešu valodalt Lietuvių kalbalb Lëtzebuergeschmk Македонски јазикmg Malagasyms Bahasa Melayuml മലയാളംmt Maltesemi Te Reo Māorimr मराठीmn Монголmy ဗမာစာne नेपालीno Norsk bokmålps پښتوfa فارسیpl Polskipt Portuguêspa ਪੰਜਾਬੀro Românăru Русскийsm Samoangd Gàidhligsr Српски језикst Sesothosn Shonasd سنڌيsi සිංහලsk Slovenčinasl Slovenščinaso Afsoomaalies Españolsu Basa Sundasw Kiswahilisv Svenskatg Тоҷикӣta தமிழ்te తెలుగుth ไทยtr Türkçeuk Українськаur اردوuz O‘zbekchavi Tiếng Việtcy Cymraegxh isiXhosayi יידישyo Yorùbázu Zulu

The Key to Azerbaijani Startup Growth: Innovation In The Energy Sector

By: Nikita YudinNovember 10th, 2020
Azerbaijan, Economic Development, Ecosystem Differentiator, Energy
Share this

An Identity Crisis For Azerbaijan’s Innovation Ecosystem

After Azerbaijan left the Soviet Union, it was the oil industry that contributed to the country’s economic development. But in the 1990s, no one could have imagined that dependence on oil would become a key contributor to future economic crises. Awareness of this issue first arose between 2005-2008. It was then that the government of the republic began to take measures for a smooth transition to non-oil sectors. It was decided to focus on tourism, high tech and agriculture. But a country that had been dependent on oil for much of its history could not simply change overnight.

The tension between Azerbaijan’s established oil industry and its aspirations for other growth paths is especially reflected in the innovation ecosystem. The country has faced an uphill battle in establishing sustainable technological growth due to the brain drain of programmers and engineers leaving for the West.

Over the course of the past 10 years, laying out brick by brick elements of the innovation ecosystem, Azerbaijan has achieved significant success. Innovation centers appeared, state programs began to support startups, grants were allocated, and foreign investments were attracted. But with all this, the ecosystem did not meet world standards. Most startups failed to go global, and those that did expand did not gain international recognition.

In early 2020, priorities were revised. It became clear that it will continue to be difficult for Azerbaijan to compete in the consumer software startup market. Therefore, it was decided to double-down on the development of innovation specifically in the oil, gas and alternative energy sector. 

A History Of Azerbaijani Oil Innovation: Past And Present

As mentioned above, there’s a long history of local growth in the oil sector. The focus on Azerbaijani oil extends much further back in time than the 1990s. Since ancient times, oil was extracted on the territory of Azerbaijan, then called “Medes oil.” It was in Azerbaijan that the first oil well was drilled, and it was the Azerbaijanis who built an entire industrial island on the water, called “Oil Rocks.” It was Azerbaijani engineers who were able to find oil fields in Vietnam in the 1960s, after American engineers failed to do so. 

It’s clear that the country’s centuries of experience in the oil sector has produced excellent specialists. Their knowledge, coupled with technological advances in the industry, can drive real innovation. With this in mind, the local oil company SOCAR is actively investing in the development of innovative methods of oil and gas production. Moreover, the intercontinental company BP, announced that in Azerbaijan, it will invest not only in oil, but also seeks to support the emergence of new startups focused on renewable energy sources. Designated teams have already been created within the company, which are supervised by specialists from the Innovation Agency of Azerbaijan.

It is likely that soon we will hear about the first startups from Azerbaijan offering solutions to problems in the oil and gas sector. There’s certainly a wealth of capital being invested to this end. In 2019 alone, Azerbaijan received US$85 billion of foreign investments geared towards energy innovation.


Share this
Nikita Yudin

Nikita Yudin

Tech Journalist

Nikita Yudin graduated from the Baku State University at the Department of Social Sciences and Psychology. Since 2018, he has worked as a journalist covering the intersection culture, technology, and the local startup ecosystem. Nikita also runs his own blog, TechTechTime, covering ecosystems in Azerbaijan and surrounding countries.

Leave a Reply Cancel reply

You must be logged in to post a comment.

Connect with us

Connect with us on social media to help showcase your country’s startup ecosystem.


Startup Universal - The Wikipedia of global startup ecosystems | Product Hunt Embed

Newsletter Sign Up

Sign up for the Startup Universal newsletter for the latest locally-sourced news and insights covering startups globally.

© 2020 Startup Universal.
View our Terms of Service and Privacy Policy.
    en English
    af Afrikaanssq Shqipam አማርኛar العربيةhy Հայերենaz Azərbaycan dilieu Euskarabe Беларуская моваbn বাংলাbs Bosanskibg Българскиca Catalàceb Cebuanony Chichewazh-CN 简体中文zh-TW 繁體中文co Corsuhr Hrvatskics Čeština‎da Dansknl Nederlandsen Englisheo Esperantoet Eestitl Filipinofi Suomifr Françaisfy Fryskgl Galegoka ქართულიde Deutschel Ελληνικάgu ગુજરાતીht Kreyol ayisyenha Harshen Hausahaw Ōlelo Hawaiʻiiw עִבְרִיתhi हिन्दीhmn Hmonghu Magyaris Íslenskaig Igboid Bahasa Indonesiaga Gaeligeit Italianoja 日本語jw Basa Jawakn ಕನ್ನಡkk Қазақ тіліkm ភាសាខ្មែរko 한국어ku كوردی‎ky Кыргызчаlo ພາສາລາວla Latinlv Latviešu valodalt Lietuvių kalbalb Lëtzebuergeschmk Македонски јазикmg Malagasyms Bahasa Melayuml മലയാളംmt Maltesemi Te Reo Māorimr मराठीmn Монголmy ဗမာစာne नेपालीno Norsk bokmålps پښتوfa فارسیpl Polskipt Portuguêspa ਪੰਜਾਬੀro Românăru Русскийsm Samoangd Gàidhligsr Српски језикst Sesothosn Shonasd سنڌيsi සිංහලsk Slovenčinasl Slovenščinaso Afsoomaalies Españolsu Basa Sundasw Kiswahilisv Svenskatg Тоҷикӣta தமிழ்te తెలుగుth ไทยtr Türkçeuk Українськаur اردوuz O‘zbekchavi Tiếng Việtcy Cymraegxh isiXhosayi יידישyo Yorùbázu Zulu