Kazakhstan is still a relatively young country, about to celebrate 30 years of independence in December, but it has already established a successful innovation ecosystem with the support of government Ministries and often as a result of its First President’s initiatives. There is no doubt it has the advantage of learning from the best practice of other countries and when you visit its capital, Nur-Sultan, you soon become aware of the scale of its development and ambition for the future. It is most definitely a country that a UK start-up should have on its radar either as part of its international expansion plans or in terms of the interesting start-ups to be found. Here we take a look at some of the key players.
The Astana Hub which was launched by the First President in 2018 is the largest technopark for IT start-ups in Central Asia. Its aim is to develop a start-up culture, supporting high-tech projects to strengthen Kazakhstan’s economy. With various arms it includes a hub space as a corporate business incubator aimed at the development of IT projects. As of October 2021, Astana Hub includes 555 companies, 54 of which are foreign. The Astana Hub works and cooperates with local venture funds including QAZTECH Ventures, Quest Ventures, Most Ventures and Qazangels Business Angels Network. It also cooperates with international organisations including Rutec Ventures and Unbound Innovations both in the UK.
Another initiative of the First President is the Astana International Financial Centre (AIFC), which was launched in 2018, is the newest financial centre in the world and the only one in Central Asia. It has its own law, based on English law, and its own court and arbitrage. There are 1,000 companies registered at AIFC from more than 50 countries, including some from the UK, and its particular areas of interest are in Islamic finance, fintech and green finance. The AIFC Green Finance Centre was created to enable the development of green finance in Kazakhstan and Central Asia. Green finance refers to investments and other financial instruments such as green and social bonds, concessional lending and subsidies for green projects, which are aimed at delivering environmentally friendly, energy efficient and low carbon projects. As a regional think-tank, the AIFC Green Finance Centre also provides strategic and business consulting in green finance and sustainable development. It established the first Green Finance Awards in the region and the Green Finance team from AIFC recently held a COP26 event in Glasgow.
Also to be found within the AIFC family is the Tech Hub which helps brings new tech initiatives to Kazakhstan, soft lands them and then builds up new economy streams for the country by building the tech development stream and ecosystem to support these companies and “connecting the dots” with the different Ministries. There is currently a strong focus on b2b tech including fintech, such as Kaspi which is already known outside Kazakhstan, and b2gov or govtech companies.
Land-linked not land-locked
One of the attractions of Kazakhstan must surely be its country neighbours and location, which sees for example the Baikonur cosmodrome based in Southern Kazakhstan which is leased to Russia, and there is also a strong presence from Chinese banks as well as the EBRD and Eurasia Bank. President Shigeo Katsu of Nazarbayev University has a very good description of the country “not as land-locked but as land-linked”.
Without doubt, the University is one of the institutions turning out an educated graduate base to fill the growing employment opportunities in the country. Nazarbayev University which is also known for its Nazarbayev University Research and Innovtion System (NURIS) focused on high-tech business creation and includes an incubator and business accelerator, offering a 12 week programme and potential investment. Since 2016, the Cluster has supported 157 start-ups and provided $1m in grants. It has staged over 3,000 events, 80 hackathons and has future plans for an Astana Business Campus Science Park.
In summary, Kazakhstan is worth a look – perhaps precisely because it is not yet that well known outside Central Asia in terms of its start-up and entrepreneurial ecosystem. Air Astana, which is an extremely successful business with two shareholders the Government of the Republic of Kazakhstan and BAE Systems PLC operates direct flights from London, won the Skytrax Best Airline in Central Asia Award 2021 and flies to 45 domestic and international destinations. Peter Foster, Air Astana’s President describes Kazakhstan as “an emerging market with some challenges but it is open for business and very anglophile. You have to be all in in Kazakhstan otherwise you’re not in at all.”