{"id":7804,"date":"2016-10-11T12:00:00","date_gmt":"2016-10-11T12:00:00","guid":{"rendered":"https:\/\/kglabs.org\/startup-ecosystem\/how-to-transform-kyrgyzstan-into-a-startup-nation-five-barriers-six-pillars\/"},"modified":"2016-10-11T12:00:00","modified_gmt":"2016-10-11T12:00:00","slug":"how-to-transform-kyrgyzstan-into-a-startup-nation-five-barriers-six-pillars","status":"publish","type":"post","link":"https:\/\/kglabs.org\/ru\/how-to-transform-kyrgyzstan-into-a-startup-nation-five-barriers-six-pillars\/","title":{"rendered":"How to Transform Kyrgyzstan into a Startup Nation: Five Barriers, Six Pillars, One Roadmap"},"content":{"rendered":"\ufeff50% of users on popular local sites\n— Internet connections 2015: 2G: 3,297,003; 3G: 1,768,305; Ethernet: 183,209; LTE: 94,841\n— ICT share of GDP: 8% (2015); total ICT revenue: $417M (28.8B som, 2015); telecom operators: 89% ($371M)\n— Subscribers: Beeline 1.927M; Megacom 1.504M; Nur Telecom 1.269M\n— Revenue: Beeline $163M; Megacom $108M; O! $100M; internet operators $56M\n— Software development market: $15M total; 40-50 active companies; 70% donor\/gov projects ($10.5M), 30% international ($4.5M); HTP: $1.5M\n— «Small market» reframe: 7M internet users \u00d7 $1\/month subscription = $84M\/year potential\n\nEducation (Slides 21-22):\n— Only 10% of schools (230) have internet; students lack computer lab access (2015)\n— CS lessons moved from 9th to 5th grade from 2016; more math hours from 2016\n— Tender for internet in 600 schools; teacher retraining program launched 2016\n— HE: 19 of 55 universities train 1,345 IT specialists\/year (2012); 800 faculty\n— IT Academy launched 2016; MBA in IT\/startups at KGUSTA from 2016\n— Manas University plans techcampus + R&D center 2016-2017\n— X-Road e-government agreement with Estonia signed end 2015\n\nSix pillars from companion doc «What we need to do…»:\n1. Education: scrum\/kanban\/lean\/agile training; soft skills (pitching, networking, English correspondence); international learning centers (Microsoft Innovation Center, Google, IBM, Facebook, Yandex, Mail.ru) ideally on university campuses; subsidized Ukrainian\/Belarusian training offices\n2. Legislation: NVCA-style startup legal framework (co-founder equity, dilution, convertible notes, IP, international company registration)\n3. Community: business angel training; investment association; ideation sessions, hackathons, meetups alongside all events\n4. Mass media: support local content + publish on international English-language platforms\n5. Investment: after establishing 100 business angels, invite international VCs; train telecoms on corporate investment\n6. Qualification: interactive startup ecosystem map; standardize\/audit local outsourcing companies; participate in international exhibitions\n—>\n\n\n

How Kyrgyzstan Could Become a Startup Nation: The 2016 Policy Case<\/h1>\n\n\n\n

On October 11, 2016, Aziz Soltobaev presented a policy argument in Bishkek under the hashtag #KyrgyzStartup<\/em>: that Kyrgyzstan could follow a deliberate path to building a startup economy \u2014 and that the conditions for doing so were already partly in place. The presentation, \u041a\u0430\u043a \u043f\u0440\u0435\u0432\u0440\u0430\u0442\u0438\u0442\u044c \u041a\u044b\u0440\u0433\u044b\u0437\u0441\u0442\u0430\u043d \u0432 \u0441\u0442\u0430\u0440\u0442\u0430\u043f \u043d\u0430\u0446\u0438\u044e<\/em> (How to Transform Kyrgyzstan into a Startup Nation), drew on real market data, international comparisons, and a set of Kyrgyz companies that had already competed and won at regional and global levels.<\/p>\n\n\n\n

The argument was not purely aspirational. By late 2016, KG Labs had run Garage48, competed in the Future Agro Challenge, sent a startup to the Startup Nations global finals in Mexico, and operated a Startup Grind chapter. The presentation was an attempt to translate those accumulated experiences into a structured policy framework \u2014 addressed not just to the startup community but to the institutions that set the conditions in which startups either grow or stall.<\/p>\n\n\n\n

\n \"Aziz\n
Startup nation policy presentation, Bishkek, October 11, 2016. Source: KG Labs archive<\/figcaption>\n<\/figure>\n\n\n\n

What Is Wrong \u2014 and Why It Has Not Been Fixed<\/h2>\n\n\n\n

The presentation opened with a direct diagnosis. Kyrgyzstan in 2016 had no venture capital, no organized business angel networks, no legislation attractive to tech entrepreneurs, no government grants or subsidies for startups, and a domestic market widely considered too small to sustain technology companies. The High-Tech Park existed \u2014 offering one of the most competitive tax regimes in the world \u2014 but had produced no visible results at scale.<\/p>\n\n\n\n

The comparison was pointed. Malaysia had allocated $150 million to build a biotech sector. Russia had put $2 billion into Skolkovo. Kazakhstan was running TechGarden with active grants and subsidies. Chile had invested $40 million specifically to attract 800 international startups to relocate to Santiago. Kyrgyzstan had built the legal and fiscal infrastructure \u2014 the High-Tech Park \u2014 and then left it largely unused. The gap was not in the enabling structure; it was in the activation of that structure.<\/p>\n\n\n\n

Why It Is Possible in Kyrgyzstan<\/h2>\n\n\n\n

The counter-argument to «the market is too small» was a list of Kyrgyz and regional companies that had already demonstrated what was achievable. Picvpic<\/strong> had won the Echelon 27 Central Asian competition in June 2015. Makeuseof.com<\/strong> sat in Alexa’s top 1,000 most visited websites globally \u2014 with a market benchmark valuation comparable to Mashable’s $300M. BeSmart<\/strong> had exited at a $2M valuation. Art Asian<\/strong> had won the Eurasia Mobile Challenge 2015 in Spain. Namba Taxi<\/strong> had reached the finals of startup competitions in Kazakhstan and Turkey. Lalafo<\/strong> \u2014 a Ukrainian marketplace product \u2014 had successfully launched in Kyrgyzstan within a year of entering the market. Kolesa.kz<\/strong> had entered at a $17M valuation and exited at $30M between 2013 and 2014.<\/p>\n\n\n\n

The Belarus example anchored the geographic argument: the creator of Wargaming and World of Tanks had become the first official Belarusian billionaire, and Belarus ranked 36th globally in ICT development in 2015 \u2014 first among CIS countries. Belarus was post-Soviet, small, landlocked, and not conventionally associated with technology wealth. The parallel was deliberate.<\/p>\n\n\n\n

The Market That Already Existed<\/h2>\n\n\n\n

The «small market» objection had a specific reframe in the presentation. By 2015\u20132016, ICT represented 8% of Kyrgyzstan’s GDP, with total sector revenue reaching $417 million \u2014 of which telecom operators claimed 89% ($371M). The three mobile operators had a combined subscriber base of 4.7 million: Beeline at 1.93 million, Megacom at 1.5 million, Nur Telecom at 1.27 million. Internet operators generated $56 million in revenue. The software development market alone was $15 million, served by 40 to 50 active companies, with 70% of that revenue coming from donor-funded and government projects.<\/p>\n\n\n\n

\n \n \n
Connection type<\/th>Subscriptions (2015)<\/th><\/tr><\/thead>\n
2G<\/td>3,297,003<\/td><\/tr>\n
3G<\/td>1,768,305<\/td><\/tr>\n
Ethernet<\/td>183,209<\/td><\/tr>\n
LTE (4G)<\/td>94,841<\/td><\/tr>\n <\/tbody>\n <\/table>\n
Internet connection types, Kyrgyzstan, 2015. Source: presentation slide 13, October 11, 2016<\/figcaption>\n<\/figure>\n\n\n\n

The 4G figure \u2014 94,841 LTE connections in 2015 \u2014 was the growth edge. Internet access costs had fallen from $100 to $15\u201330 per Mbps over two years. Mobile traffic had exceeded 50% of total users on popular local sites. The infrastructure was shifting faster than the product ecosystem that could use it.<\/p>\n\n\n\n

The thought experiment that followed: imagine a Kyrgyz startup with 7 million internet users subscribing at $1 per month. That is $84 million per year in potential revenue \u2014 from the domestic market alone, priced at a tier accessible to Kyrgyz consumers. The «small market» argument assumed that the only market was offline and traditional. The connectivity data suggested otherwise.<\/p>\n\n\n\n

The Roadmap: Startup Bishkek, Startup Valley, Startup Nation<\/h2>\n\n\n\n

The presentation proposed a phased trajectory: Startup Bishkek<\/strong> by 2017, as the concentration phase \u2014 building critical mass of founders, events, and community in the capital. Startup Valley<\/strong> by 2019, expanding the ecosystem beyond Bishkek into regional hubs. Startup Nation<\/strong> by 2021, as the moment when the ecosystem would have enough depth \u2014 in investment, talent, and policy \u2014 to operate as a self-sustaining system.<\/p>\n\n\n\n

The target for the goal state was specific: 1,000 Kyrgyz startups, so that at least 2 could reach a $100 million valuation and exit within three years. The funding ladder was explicit \u2014 pre-seed through startup competitions ($3\u201310K), seed through local business angels, Series A through Kazakhstan, Ukrainian, and CIS investment funds, Series B through global venture capital. Each stage was already present in some form in the regional ecosystem; what was missing was a Kyrgyz pipeline feeding into it.<\/p>\n\n\n\n

Six Things That Would Need to Change<\/h2>\n\n\n\n

The companion document to the presentation \u2014 What We Need to Do to Boost Tech Entrepreneurship in KR<\/em> \u2014 spelled out six operational areas:<\/p>\n\n\n\n

\n \n \n
Area<\/th>Key actions<\/th><\/tr><\/thead>\n
1. Education<\/td>Scrum, kanban, lean startup, and agile training for existing companies; soft skills (pitching, networking, English correspondence, international client relations); international learning centers (Microsoft Innovation Center, Google, IBM, Facebook, Yandex, Mail.ru) on university campuses; subsidized training from Ukrainian and Belarusian partners<\/td><\/tr>\n
2. Legislation<\/td>NVCA-style startup legal framework: co-founder equity agreements, dilution mechanics, convertible notes, IP ownership, international company registration procedures<\/td><\/tr>\n
3. Community<\/td>Business angel training and investment association; ideation sessions, hackathons, meetups, and thematic gatherings running in parallel with every major event<\/td><\/tr>\n
4. Mass media<\/td>Support local content; publish on international English-language platforms to raise Kyrgyzstan’s visibility in the global startup conversation<\/td><\/tr>\n
5. Investment<\/td>Build to 100 business angels, then invite international VCs; train telecoms and internet operators on corporate investment and startup integration<\/td><\/tr>\n
6. Qualification<\/td>Build an interactive startup ecosystem map; standardize and audit local outsourcing companies by headcount, skills, English capacity, and legal structure; attend international exhibitions jointly<\/td><\/tr>\n <\/tbody>\n <\/table>\n
Source: «What We Need to Do to Boost Tech Entrepreneurship in KR,» companion document, October 2016<\/figcaption>\n<\/figure>\n\n\n\n

Education and Infrastructure: What Was Already Moving<\/h2>\n\n\n\n

The presentation documented what had already happened in education policy as evidence that the system was capable of change. Computer science lessons had been moved from 9th grade to 5th grade starting in 2016. More math hours were mandated across schools. A tender had been issued to connect 600 schools to the internet. A teacher retraining program for computer science instructors had launched. The gap was still large \u2014 only 230 of Kyrgyzstan’s schools (10%) had internet access in 2015, and most students lacked access to computer labs \u2014 but the direction of change was established.<\/p>\n\n\n\n

At the higher education level, 19 of 55 universities were producing 1,345 IT specialists per year, with around 800 faculty in relevant departments. The IT Academy had launched in 2016. An MBA in IT and startups had started at KGUSTA. Manas University was planning a techcampus and R&D center. Estonia’s X-Road e-government system had been signed for implementation in Kyrgyzstan at the end of 2015. A dedicated state communications body \u2014 Goskomsvyaz \u2014 had been created in 2016, for the first time giving ICT policy its own institutional home in the government structure.<\/p>\n\n\n\n

None of these were sufficient on their own. But the presentation’s argument was that they were cumulative \u2014 that the question was not whether conditions existed, but whether they would be deliberately connected into a system, or left to continue developing in parallel, at lower velocity, without strategic coherence.<\/p>\n\n\n\n

\n\n\n\n
\n\n\n

Presentation Details<\/h3>\n\n\n\n
\n \n \n
Detail<\/th>Information<\/th><\/tr><\/thead>\n
Presentation date<\/td>October 11, 2016<\/td><\/tr>\n
Hashtag<\/td>#KyrgyzStartup<\/td><\/tr>\n
Presenter<\/td>Aziz Soltobaev \u2014 KG Labs Foundation; Internet Society KG; BOT Systems Venture Fund<\/td><\/tr>\n
Title<\/td>\u041a\u0430\u043a \u043f\u0440\u0435\u0432\u0440\u0430\u0442\u0438\u0442\u044c \u041a\u044b\u0440\u0433\u044b\u0437\u0441\u0442\u0430\u043d \u0432 \u0441\u0442\u0430\u0440\u0442\u0430\u043f \u043d\u0430\u0446\u0438\u044e (How to Transform Kyrgyzstan into a Startup Nation)<\/td><\/tr>\n
Key market data<\/td>ICT = 8% of GDP; total ICT revenue $417M; software market $15M; LTE subscriptions 94,841 (2015)<\/td><\/tr>\n
Roadmap<\/td>Startup Bishkek (2017) \u2192 Startup Valley (2019) \u2192 Startup Nation (2021)<\/td><\/tr>\n
Target<\/td>1,000 KG startups \u2192 at least 2 exits at $100M within 3 years<\/td><\/tr>\n
Archive<\/td>2016-10-11 startup presentation\/ (47 files: PPTX, PDF, 40+ images, companion doc)<\/td><\/tr>\n <\/tbody>\n <\/table>\n
Source: markitdown-output\/2016-10-11 startup presentation\/; «What we need to do to boost tech entrepreneurship in KR.md»<\/figcaption>\n<\/figure>\n\n\n<\/div>\n","protected":false},"excerpt":{"rendered":"

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