Azerbaijan's venture ecosystem is rapidly developing, reflecting the overall growing interest in innovation and tech entrepreneurship in the country. More and more startups are emerging in the fields of fintech, artificial intelligence, energy, and education, and public and private initiatives are creating a favorable environment for their development. Investors have begun to view Azerbaijan not only as a local market but also as a promising entry point into the international arena. One active participant in this process is DOMiNO Ventures, a venture capital fund investing in early- and growth-stage tech startups throughout the Central Asia and Caucasus region. The fund actively supports companies focused on global markets, helping them develop scaling strategies and attract international investors. Mustafa Kopuk, managing partner and co-founder of DOMiNO Ventures, venture capital expert, founder of Tarvenn Ventures, TechOne VC, and WePlay Ventures, and board member of YEO Technologies, answers AZERTAC's questions.
- DOMiNO Ventures invests in early-stage startups. What qualities do you consider crucial for a startup to be venture-ready in an emerging market like Azerbaijan?
-What makes a startup venture-ready in Azerbaijan is the ability to combine strong local talent with a truly global mindset from day one. We are particularly drawn to “first-day global” and tech-driven startups that have the ambition to scale internationally, supported by a resilient founding team and a business model that can compete on a global stage. For us, the most promising founders are those who use Azerbaijan’s advantages as a cost-effective and skilled talent hub while building products and services designed to address markets far beyond the region. Also I need to clarify that, we invest not only in early-stage startups but also selectively in growth-stage startups across Central Asia and the Caucasus.
- Which tech verticals do you consider most promising for countries with small but flexible economies like Azerbaijan?
-In my view, the most promising verticals for countries like Azerbaijan are those that can quickly transcend borders and deliver global impact. Applied AI and Deeptech stand out because they enable the creation of high-value, scalable solutions with immediate relevance to global markets. Cleantech and energy efficiency are also highly attractive, especially as Azerbaijan looks to diversify its economy and embrace sustainability. At the same time, Edtech and Cybersecurity offer strong potential, since they respond to universal needs that are not limited by geography. For small but flexible economies, focusing on these areas creates the chance to build companies that are born global from day one.
- Similar to Türkiye, Azerbaijan is currently actively investing in innovation. What lessons from the development of the Turkish venture capital scene could be useful for us?
-Azerbaijan is fortunate to have Turkey as a close example to learn from. One of the most important lessons from Turkey’s experience is that, because of its large population and GDP, many entrepreneurs focused primarily on the domestic market. Some stayed local, believing that success at home was sufficient, while others felt they had to prove themselves locally before venturing abroad. This mindset often slowed down global expansion.
For Azerbaijani founders, the key takeaway should be different: there is no need to limit yourself to testing only in the local market. It is essential to build companies that are global from day one. By adopting this mindset early, Azerbaijan can avoid the delays Turkey experienced and create success stories that inspire the next generation while positioning its startups to compete internationally from the very beginning.
- Do you think the Azerbaijani market is ready for the arrival of large funds and international investors, or is an intermediate phase of local growth necessary?
-I believe both processes should develop in parallel. Local growth is essential to strengthen the foundation of the ecosystem and build a healthy pipeline of investable startups. However, involving international investors early on is equally important because their presence raises standards in governance, reporting, and global network access. The ideal scenario for Azerbaijan is not to wait for one stage to end before starting the other, but to create meaningful collaboration between local and international capital from the beginning. By doing so, the ecosystem can grow faster, founders can learn global investment dynamics firsthand, and startups can scale beyond the region much sooner.
- What first step should an Azerbaijani entrepreneur take to attract the interest of a regional or international venture capital fund?
-The first and most important step is to demonstrate global readiness from the very beginning. Incorporating in an investor-friendly jurisdiction such as the US, UK, or EU while keeping your technical team in Azerbaijan sends a strong signal that you are serious about scaling internationally. It is also important to show early traction through pilot customers, partnerships, or even initial revenues, especially if they extend beyond the local market. Investors are looking for founders who can clearly communicate not only the local problem they are solving but also how their solution can compete and grow globally. In today’s environment, VCs no longer invest only in ideas; they invest in execution, ambition, and global potential.
- How important is the development of corporate venture capital (CVC) in countries like Azerbaijan, where both state-owned and large private companies are strong?
-Corporate venture capital plays a crucial role in accelerating the maturity of an ecosystem, especially in countries like Azerbaijan where strong state-owned and private companies already exist. These institutions can provide much more than capital because they offer access to customers, infrastructure, and real market validation.
In Türkiye we saw how large conglomerates and banks helped the ecosystem grow rapidly by investing in startups, running pilot programs, and becoming their first reference customers. Azerbaijan can achieve similar progress by encouraging its major corporations to collaborate with innovative startups. When corporate funds start investing strategically, it creates a bridge between traditional industries and new technologies, allowing both sides to grow faster and positioning the entire country as a regional innovation hub.
