00:00hi everyone welcome to the a six in Z
00:02podcast I'm sonal and I'm here today in
00:05another special edition of the a six in
00:07Z podcast we have two special guests
00:09including one internationally dialing in
00:11from Iran Mohsen Molly Ari who is a
00:14co-founder of a very prominent startup
00:17accelerator in Iran called avataq we're
00:19here also with Christopher Schroeder who
00:21wrote a really interesting book last
00:23year called startup rising and has been
00:25documenting and facilitating the
00:27phenomenon that's happening right now in
00:28the Middle East and particularly in Iran
00:30where there's a lot of interesting
00:32startups and a rich ecosystem being
00:34built out motion it's great to be with
00:36you how are you I'm doing great thanks
00:37it's a it's a pleasure to be on the
00:39podcast I don't think there are lots of
00:41Americans who think startup accelerator
00:44incubator and Tehran in the same
00:47sentence so could you just talk a little
00:49bit really just kind of a cook's tour
00:51from your view of what's been happening
00:53over the last couple of years into Iran
00:55as startups are beginning to rise in
00:58such powerful ways there there has been
01:00a huge change in the past couple of
01:02years in Iran India startup scene I
01:04should say where we started like two
01:07years two and a half years ago when we
01:10organized the first startup we can even
01:12Tara the reason we did that was that for
01:17doing some research we came to know that
01:18lots of startups are failing in Iran and
01:22there isn't much talk about it because
01:26most of them they don't have a clue of
01:27how to build a startup so that's that's
01:30how we learned that we maybe need to do
01:33sort of weekend events and start
01:35building startup communities around it
01:37we so much used the book of Brad Feld
01:41which is called the sort of communities
01:44we were reading it almost used as a
01:47Bible on how to to to build one here in
01:50Tehran and suddenly it started to flame
01:53over the country so we started to to see
01:55a lot of events happening in different
01:57cities for example only the last
01:5912-month we did like 35 a sort of
02:03weekend events in different cities and
02:05it's not just as a startup weekend
02:07events it's like the whole events that
02:10that encouraged the community to get
02:12involved and to grow
02:15so on one part you see the echo system
02:17is being built up in the country and at
02:20the same time in the past couple of
02:23years we see the successes stories
02:25actually being realized both at local
02:28and international level in Iran why did
02:31you even decide to do a startup weekend
02:33two years ago and and what was kind of
02:36your vision for the ecosystem and how
02:37has it played out for you since then I
02:39can go back in time and see that when we
02:43started doing the I was an entrepreneur
02:45myself we and me and my co-founder we
02:48had a digital advertising company which
02:53still exists and at that time although
02:56we were on entrepreneurs and we were
02:57having our own startups we were so much
02:59interested to see how we can leave an
03:02impact on our own community so at that
03:05time before even we started running
03:08those kind of events around the startups
03:10we were having meetups regularly there
03:14trying to engage the community of tech
03:17tech people but at that time maybe the
03:20focus was not so much on
03:21entrepreneurship I should say but over
03:24time observing what was happening and
03:26seeing a lot of those failures stories
03:28by talented engineers who were like
03:30really genius and there were lots of
03:32them were already draining from the
03:36country outside we came to know that
03:38maybe entrepreneurship is the right
03:40solution to it and we shouldn't focus
03:42focus more on the startups and I can I
03:45could emphasize that at the same time
03:47the same was happening in the Middle
03:49East in the whole region perhaps so we
03:51were seeing almost similar stuff in
03:54Turkey in Arabic countries and we were
03:57you know if we were making sure that
03:59perhaps we're on the right track I think
04:01that people here underestimate that if
04:03you believe is I do and obviously our
04:06friends at a 16z billion for that their
04:09software is eating the world that means
04:10the world that whenever there's
04:12ubiquitous access to technology as I
04:14said from the beginning people just have
04:16the tools to solve problems or create
04:18their economic futures and I am seeing
04:21this I mean in the America when you
04:23think Middle East all you think of it
04:24CNN and Isis and I'm seeing literally
04:26hundreds of thousands
04:27young people using tools to step up in
04:30the same ways that you're talking about
04:32I want to talk a little bit about your
04:33first Ivy Tech class but before that you
04:36mentioned two or three companies which
04:38are doing some amazing things there did
04:40you kill a little bit about digital and
04:42the other two that you've talked about
04:43and and and how they're doing sure there
04:47was this report last year coming out it
04:50was a startup word report which was
04:52conducted in 50 different countries
04:54doing a survey on this startup scene and
04:57the report result came out with three
05:00top valued companies in different
05:02countries and in Iran the top companies
05:05we're digi color Cafe bizarre and
05:07apparat so digital is basically that
05:10they bake the biggest online retail in
05:11Iran it's like Amazon of Iran the the
05:15the second one was apparat which is a
05:17clone of YouTube because because the
05:21access is blocked in the country and
05:22also there are some services from Google
05:25which are blocked uses sanctions are not
05:27being provided to the to the people so
05:29that's a service which is similar to
05:31that there are serving millions of users
05:34every day and the third one is is a
05:38Android at the store place with more
05:41than 15 million users right now and they
05:44are basically some something quite
05:46similar to Google Google Play which is a
05:49marketplace for applications so the
05:53Iranian Android users can both download
05:56applications and also the developer
05:58community and the application builders
06:00can can publish their their applications
06:03on this platform and this happy because
06:06Google Play effectively pulled out
06:08because of sanctions or whatever is that
06:10right they filled a vacuum it's it's
06:13very interesting to know that Google
06:15Play used to be blocked until last year
06:17there were some changes in Treasury
06:20regulations which may do which later on
06:23they open up the access but nothing has
06:25really changed in terms of access to
06:27Google Play because by the time that the
06:30Google Play service was opened up in the
06:32country although there was there hasn't
06:33been a lot of advertising around it
06:35which I don't think Google needs but
06:37cafe Bazaar has already created some
06:39domination in the market so
06:41they are still the dominant in terms of
06:43like number of users and number of
06:45applications being downloaded but I
06:47think in terms of publishing
06:48applications still there are some
06:50sanctions which doesn't that uranium app
06:53builders to really publish their
06:55applications officially I should say on
06:57those and in fact those are there like
06:59this was stunning to me but there are
07:01millions of iPhones there you can only
07:04download iPhone free apps right you're
07:06not able to transact and buy paid apps
07:08is that true though the reason is that
07:11because of sanctions we are not
07:12connected to the global credit when Visa
07:16and MasterCard systems which like turn
07:19to country to create their own local
07:21platform which is like we do we use for
07:22online online payments but that's true I
07:26mean we people in Iran
07:28basically honestly they kind of tried to
07:31bypass somehow or they buy items gift
07:34card which is not very popular so most
07:36of them are now using if free
07:38applications so it's interesting to me
07:41that the companies that you've mentioned
07:43have effectively been there's a word I
07:46hate we use in America called copycats
07:49and what I like to use an effect of my
07:52book I call them improvisers because
07:53what what great entrepreneurs do is
07:55don't merely make quote unquote the
07:57Amazon of the of Iran they are actually
07:59thinking about running consumers and
08:01thinking about very specific needs in
08:04the market and so they're taking things
08:05which should work elsewhere but they're
08:07making them there and so there ii think
08:10is a curious your view on that are most
08:14of these startups really first things
08:16that have worked in the west and how do
08:18you think about that and then secondly
08:20what are the ramifications if sanctions
08:23fall when the actual history companies
08:25come in to iran sure I think that the to
08:30the first question which asked if
08:34copycats I mean how is the system of
08:37copycats in the country I think it's
08:38like any other emerging market when we
08:41see the penetration of internet
08:43increases the market opportunities that
08:45shows up very clearly are the ones which
08:48have been proven in in the rest of the
08:50world and any other gene I do
08:54Yemma suteki which is the seamless of
08:58turkey MercadoLibre which is the Amazon
09:00of Latin America this happens everywhere
09:03right right and I don't think like I
09:06mean as you as you mentioned it's really
09:08not maybe proper to call them copycats
09:11because because that's the idea and
09:14that's the market opportunity and on an
09:16entrepreneur has to tap into the
09:18opportunity so they ran to it but it's
09:22seeing if there are also innovations
09:24happening in terms of being very
09:26innovative with new ideas we we have
09:28experienced it in our startup
09:31accelerator program ourselves we believe
09:33that the whole innovation ecosystem is
09:35very nascent at this stage but will
09:37improve over time as there will be more
09:39access to finance there will be no more
09:42knowledge on how to to lead and build
09:44those type of innovations and put build
09:46companies over them so I'm sure that it
09:48will change over time but maybe at this
09:50stage still we can call it very nascent
09:53I had a wonderful entrepreneur who built
09:56who was effectively the Yahoo of the
09:59Middle East called Mach 2 which got
10:00bought by Yahoo for almost two hundred
10:02million dollars we had a conversation
10:04like this and he said to me Christie
10:05said be practical I mean this is new to
10:08these markets these are markets that
10:10often don't embrace risk these are
10:12markets that often have people seeking
10:14government jobs or big corporate
10:15engineering jobs if they can find them
10:18at all if some kid came home and said
10:20mom dad I'm dropping out of college and
10:23I'm gonna do a Facebook you know they
10:26would have been laughed at their friends
10:27would have said it's crazy they wouldn't
10:28been able to find investors but by doing
10:31what you just described it seems to me
10:32success breeds success and when
10:35investors see success in communities see
10:37success more people want to do it and
10:39then it does exactly as you say it opens
10:42up an entire ecosystem am I missing
10:43something no absolutely I mean that we
10:47have seen how the interest of the young
10:49community has changed once they started
10:52to see these suckss local successes
10:54stories being realized so we see them
10:57that instead of looking at Mark
10:58Zuckerberg and like Steve Jobs and say
11:01that okay maybe in this country I can't
11:03really do it they see that No maybe even
11:05successful stories can exist in the same
11:08and I mean to hopefully we may we might
11:11even to see that the rate of brain
11:14drains would decrease over time as as
11:16the the local ecosystem encourages and
11:19empowers their entrepreneurs which i
11:21think is an amazingly important point
11:23because I was struck that obviously most
11:26in some of the best engineering talent
11:28that I've seen in emerging growth
11:30markets I've met in Iran you guys
11:34graduate something like six or seven
11:35hundred thousand engineers across the
11:38spectrum of engineering every year half
11:40of them by the way are women but a lot
11:43of them are trying to leave the country
11:44and you think that that might change now
11:47both because of entrepreneurship and
11:48also because of the potential if the if
11:52in fact the sanctions get lifted I'm
11:55sure that the impact would be even
11:57higher over time and the impact is not
12:01only to stop brain drain and not it's
12:03not really stopping but decreasing that
12:04is the brain drain we have started to
12:06see some of those successful gaya
12:10sprouts started to coming back to the
12:12country those who have been working in
12:14top 10 you know engineering companies
12:17and top startup companies they they now
12:20realize that maybe this emerging market
12:22is the right thing to do instead of
12:24working for example for our Cisco or
12:26Tudor maybe they can leverage that
12:28knowledge and come back to this emerging
12:31market and start doing in their own
12:33country so that that could be a huge
12:35impact over time I believe so you set up
12:37Ivy Tech as a vehicle to help such
12:40people as you've just described meet
12:44needs that they have like how do I do
12:45this how do I begin what do I need can
12:48you talk a little bit in your vision of
12:50avataq what problems do you think you're
12:52solving for the ecosystem and from the
12:54entrepreneurs themselves and how do you
12:56think this will evolve over the next
12:58couple of years yeah we we have a very
13:01simple vision at our tech if I want to
13:04put it into one sentence is is a day
13:07where no matter which family you are
13:10coming from or if you have a reach that
13:12or a connected family well unless you
13:15are an innovative person and you can
13:17build value then you do not have to
13:21like the access to finance and access to
13:23knowledge so this is the simply division
13:25that we are trying to to create at our
13:28tech so that's why we have been trying
13:30to to help the young entrepreneurs you
13:33know coming from different cities having
13:36their ideas being so passionate and just
13:38we take them to our program we try to
13:40mentor them to train them and get them
13:42ready and by the end of the program we
13:44try to help to connect them with the
13:46investors can you tell us about the
13:49program what's how long are they there
13:50what kind of money do you arrange for
13:52them with services do you think they
13:54need most in value most from you in that
13:57we have been observing what is what's
14:01happening at the global level we we
14:04haven't really tried to copy the Silicon
14:08Valley model which we believe that
14:09doesn't really work in in such an
14:11emerging market are you talking about
14:13like Y Combinator and 500 startups or
14:16hopefully we have tried to to get as
14:19much as possible and they have been very
14:21helpful I should say that like we have
14:23been in touch with top figures in
14:25Silicon Valley trying to get on getting
14:28on a Skype call with them get get their
14:30insight into what we should be doing
14:31here but we yet I mean we haven't tried
14:35to copy tech stars or Y Combinator
14:37company to here which we we believe that
14:39doesn't work in such markets what do you
14:41mean when you say that the in terms of
14:43the amount of funding you provided how
14:45long is the program for example let's
14:48say that mentorship is is a culture that
14:51has been existed in Silicon Valley for
14:53the past couple of decades but in in
14:57Iran the whole the whole culture of
14:59doing mentorship is new so you can't
15:02really count so much as such mentors or
15:05the other one is the maturity of the
15:07investor communities it's absolutely
15:09different like you don't have people's a
15:11lot of angels trying to you know being
15:14able to write checks easily without
15:15going into too much detail agents and
15:17trying to figure out everything on the
15:20investment memorandum let's say so that
15:23that's the reason that we believe that
15:25we needed to tailor-made this program
15:27into what we have here so there are many
15:29differences for example the the length
15:32of the program is not very short it's
15:35it's six months which consists of pre
15:38acceleration and acceleration or the way
15:41we do graduation a demo day is not that
15:44we just get them in front of investors
15:45and we say goodbye we believe that we
15:47need to help them step by step to closed
15:51this is gonna be a knowledge that these
15:53guys are going to put up and they're
15:56going to share their experience we need
15:57to also help them close the deals get a
16:00get into negotiations with investors try
16:03to empower them in any way so that's
16:05that's how for example the program is
16:08different at this stage it's a talk a
16:11little if you just announced the class
16:12not too long I don't have you : class or
16:14what do you call the we call them cycle
16:16one talk about some of these gems that
16:19you have found in cycle one well I
16:21should first of all say that we were
16:23absolutely inspired by what the
16:29entrepreneurs has been able to achieve
16:30in such a short period of time which is
16:32six months we when I go back in time I
16:36remembered that like we once we were
16:39calling for applications we were having
16:41people showing up as P as one person or
16:45or like they were not able to to page
16:47properly to tell us what they really
16:50want to do but I should emphasize that
16:53what we did is that we try to believe in
16:56them and I mean if they wanted to get in
16:59front of an investor they would have
17:01absolutely get a red card and they would
17:03say that no don't don't call us anymore
17:05like we don't want to hear this again
17:07but we instead try to understand what
17:10their core system looks like which we
17:12try to believe in those people we got
17:14them into the program we had like in the
17:17first cycle we had around hundred
17:18applicants only which in the second one
17:20increased to 250 applicants but out of
17:24those hundred applicants we selected 20
17:27of the teams and we tried to help them
17:29during the program we'd a lot of
17:32trainings a lot of workshops on you know
17:34starting from how to pitch going up to
17:37like getting tractions doing sales and
17:40marketing a user experience and stuff
17:44like that and at the same time we
17:45started to create a network of mentors
17:47which is not only local
17:49or so many of them has created those
17:52success stories which I just mentioned
17:53we have seen a lot of interest from
17:56people successful entrepreneurs in
17:58different countries sending us email hey
17:59guys were inspired what we with what
18:01you're doing we want to help let us know
18:03how you do how we can't get engaged so
18:05they have even been people who are not
18:08Iranian and they are based for example
18:09in Berlin or they're based in Washington
18:13and they are now helping entrepreneurs
18:15in Iran that you know they get on skype
18:19calls sometimes they travel and they
18:21just stop by by the accelerator and they
18:24spend hours with the teams this has been
18:26very effective I mean when we see the
18:29outcoming results which is still perhaps
18:32is not really comparable with with the
18:34graduation from top accelerators around
18:36the world but when we see the progress
18:39it shows that it has been a huge
18:41progress and we believe that if we
18:42cancel out the entrepreneurs with the
18:44right environment then they gonna start
18:46glowing in that in that environment so
18:49I'm gonna ask you admitted again about a
18:51couple of the specifics in avataq in the
18:54cycle but you you you're pulling on
18:56something very interesting here because
18:58I visited accelerator programs around
19:00the world in emerging growth markets and
19:03I mean a little secret I think about
19:04them even in America is that maybe with
19:06the exception of like competent fate or
19:08maybe 500 startups a lot of them in the
19:10states have had a mixed batting average
19:12in law and yet I think in a in in
19:15nascent ecosystems they're invaluable
19:17and just very very powerful because of
19:20the reasons you've just suggested what
19:22do you think are some of the most
19:24fundamental structural problems that
19:26your entrepreneurs are facing and I mean
19:29this is twofold one is what do you think
19:34that that literally is just a challenge
19:35for them to start a business in Iran but
19:38secondly and I've seen this in other
19:39markets where you know they're
19:42culturally just learning how to be an
19:44entrepreneur the amount of hard work
19:46that has to go into the the talent in
19:48Iran is unquestionable but are they're
19:50just sort of in these early days
19:52challenges that the entrepreneur's have
19:54to learn to be great entrepreneurs or
19:56are they really just ready to go and
19:58it's just a matter of them going well I
20:02of course different perspective to these
20:06questions but I can't emphasize on two
20:10different sides so one side is the a
20:13entrepreneurs themselves I think the
20:15biggest challenge that they're faced
20:17with is is leadership is how they are
20:22empowered as as entrepreneurs in
20:25internally to take over and accept to go
20:28to such a you know challenging journey
20:30which is challenging I mean nobody is
20:33doubt that it has a lot of ups and downs
20:35and keeping a team and building a
20:38concrete team and leading a concrete
20:40team around it I think that's the
20:41biggest challenge at this stage and they
20:44need to learn how to do it because the
20:46rest can be done by trainings but
20:48mentorship but unless they can't really
20:51solve it internally with themselves
20:52getting ready to go to Tucson journey
20:54and having a purpose for it it would be
20:57difficult for them to do it I think so
20:59we that's why we also emphasize so much
21:01on soft skills like leadership
21:02communication and things like that
21:05especially beginning of the program we
21:07spend so much time with the teams to to
21:09help them were with with Sasha skills
21:11and the other side I think the biggest
21:14challenge that the entrepreneurs in Iran
21:16are faced with is the word to leave I
21:20think that's the biggest challenge that
21:21there but nobody is leaving them I mean
21:23the government sometimes they don't
21:25believe in them the investors they don't
21:27believe in them and all this you don't
21:29believe in people like you can't really
21:31make you make a huge change you you have
21:33to believe that these guys because it's
21:36all based on projected future you know
21:38in America when we think about the
21:40government in wrong we think of it
21:41through the lens of you know frankly
21:43Argo and obviously rule of law
21:46corruption I mean there are serious
21:47issues as there are in many emerging
21:49markets I was quite surprised to see 31
21:53government accelerators with some very
21:55good technology in it
21:57and I was very surprised to talk to
22:00ministers in the information
22:02communication technology area who talked
22:07about a hell of a vision to build
22:10infrastructure there to encourage
22:12innovation in very serious ways are you
22:14feeling that on the gray
22:15we have been feeling it over the past a
22:18couple of years especially after the
22:20election that the government is really
22:22keen to know how they can't lift the
22:26barriers I mean like anywhere in the
22:29world the government has to focus on
22:31infrastructure instead of like getting
22:33so much engaged with uh with the startup
22:35communities and entrepreneurs but I
22:37think the government has the real
22:39intention to help and in some parts they
22:42have been able to do it
22:43we now have initiatives which are
22:46supported by government to promote this
22:49startup saying they believe that
22:51entrepreneurship is the right solution
22:53two to two most of the challenges both
22:56economic and political and all this so
22:58do we we have seen a huge improvement in
23:01the region of the government and in in
23:05their approaches on how they can help
23:07their entrepreneurial ittle bit about
23:11some of your favor I will say either no
23:13such things as favorites but just tell
23:15me about a couple of the recent cycle of
23:18Abba tech companies that are intriguing
23:21you so for example in the first cycle we
23:24we did have different startups we did
23:28have a start-up which was basically a
23:31food delivery platform an online food
23:34delivery platform we which was
23:37absolutely targeting a local market to
23:39make we're trying to create a local
23:41value and we did have startups which are
23:44not clones of successful models for
23:47example we did have a start-up trying to
23:49do something and sharing economy so
23:52people can lend their stuff together to
23:54each other but we did have an
23:56application trying to help people choose
23:58their favorite music in public locations
24:01for example which was confidence which
24:03many of them are like published on the
24:05website of our attic so I can tell that
24:08they were there were diverse set of
24:13startups in the first cycle I just came
24:16back after being intelligent Istanbul
24:19Turkey of course is a remarkable market
24:22the food service service there the
24:25seamless of Turkey is a company called
24:29acquired for over 650 million dollars
24:31and there have been several multi
24:33hundred million dollar exits there one
24:36of the limits on Turkish startups and I
24:38wonder if this has a limit in all with
24:40Iran going forward is that not that many
24:42people outside of Turkey speak Turkish
24:44so you know do you find that Persian is
24:48obviously a language of Iran but do you
24:51find that folks are thinking now with
24:54the global economy coming that they're
24:56they're trying to think about things in
24:57English are they thinking about how to
24:59reach other emerging growth markets is
25:02there any limitation on the language as
25:06a unique thing for Iran how do you think
25:08about that going forward
25:09sure language is absolutely a barrier
25:12but I don't find it as the biggest
25:14barrier I think the biggest barriers is
25:15the local challenges that building is a
25:18business has in this market from
25:21understanding the dynamics of the market
25:23the perspective of the customer how you
25:25want to do the operation which is
25:27absolutely every emerging market has its
25:30own you know dynamics in their own
25:33market so this is I think is the biggest
25:35barrier to understand how the local
25:37economy looks like going back to a
25:39question I think we didn't really talk
25:40about it is that what what would happen
25:42in Iran once the sanctions are lifted
25:44and then the international companies to
25:47at one level you've articulated almost a
25:50strange benefit that startups that have
25:52by sanctions meaning they've been able
25:54to build things without a lot of global
25:57competition and build some very strong
25:59enterprises doing it if sanctions come
26:02down obviously the big global players
26:04will be in very very quickly and we see
26:06Google Twitter Facebook LinkedIn all
26:09over the world right now so I had
26:11someone say something very interesting
26:12about India though they said to me that
26:15if you're very locally focused the big
26:17players have had trouble so you know
26:20Facebook Twitter LinkedIn they they tend
26:23to be say in a country like India they
26:25tend to be the LinkedIn Facebook elite
26:27winners of India but there's a reason
26:28why flip car is doing so well there
26:31which is you really need to understand
26:32locality to be able to succeed you can't
26:34just jump in overnight and I'm wondering
26:37if the sanctions come down how do you
26:39look at the Western companies an Asian
26:43coming in and what do you think are
26:45gonna be areas that Iranian companies
26:47not only will hold very strongly with in
26:49Iran but will be able to enter the
26:51global market more yeah I I do have my
26:54very personal perspective on this I
26:56believe that if the country has come
27:00specific competitive advantages in
27:02specific sectors the wealth and the
27:04value has to be created by the local
27:07community and for example if Iran
27:10doesn't have for example it's just an
27:12example if we don't have real
27:14competitive advantage in producing cars
27:17for example Volkswagen entering to the
27:19market is an absolutely great
27:21opportunity if there isn't any
27:23competitive advantage but the challenge
27:25for entrepreneurs for local
27:26entrepreneurs here would be creating
27:29absolute barrier to entry by by creating
27:32domination so that's that's what
27:34happened to Philip card I think because
27:36Philippe card was not only you know
27:39solving the the local challenges
27:41perfectly but also over time before
27:44armors on steps and they have been able
27:45to get some markets here and there over
27:48time they has been able to change it to
27:50market domination so I think local
27:52entrepreneurs the biggest chariot the
27:54biggest challenge for them is that until
27:56the the sanctions are lifted which I
27:58should actually even emphasize that not
28:00all companies waited until sanctions be
28:03lifted completely some of them has
28:05already started moving in the country
28:07but they have to work hard and they have
28:11to try to create barriers to entry for
28:12them if they believe that they have the
28:14competitive advantage of doing it much
28:16better in the local market so you
28:18mentioned something parenthetically that
28:20to me was one of the maybe two or three
28:22biggest takeaways I had there which is
28:25you know Americans tend to think like
28:27sanctions is about America and America
28:30will decide this in America needs to be
28:32there and frankly historically there's
28:35been truth to that to make it in
28:36technology globally in the last 20 years
28:39has meant to Make It in America if not
28:41in the West right I mean even hardware
28:44providers like Sony or Samsung you know
28:48you had to make it in America because
28:49that was the market for it but but also
28:52we're seeing we saw it with Alibaba and
28:53we're seeing it more and more that
28:55companies and other country
28:57are becoming very aggressive and you
28:59mentioned and I saw this everywhere when
29:02I was in Tehran a couple weeks ago the
29:04rest of the world is showing up I saw
29:06Chinese everywhere I saw Germans
29:07everywhere I saw Scandinavians
29:09everywhere I saw Indians everywhere and
29:12you you touched on that I mean talk
29:14about the Lee what other countries are
29:17doing and what they're exploring and the
29:19the Iranian ecosystem now there is a
29:21well-known company Crocket internet
29:23there which has already has started
29:25operating in the country a German
29:27company which is basically cloning the
29:30successful models in emerging market
29:31where the echo system is not really
29:34bright that local entrepreneurs be able
29:36to create it but they haven't really
29:39officially talked about it but they have
29:43been operating here and cried-- trying
29:45to build startups some of them which is
29:48already existed by by local
29:51entrepreneurs some of them haven't still
29:53haven't been started yet but I mean for
29:56that that's just an example they have
29:58been operating since the last couple of
30:01months and they are now spending a lot
30:03of money to be able to create more you
30:06know to to get the market share on those
30:08specific markets that they have targeted
30:11Samsung phones are everywhere HTC phones
30:14are everywhere I hear show me is coming
30:16in so that's that's in Internet the
30:18startups but we see yes we see that
30:20Samsung LG Sony all these companies are
30:23hugely working here and they are having
30:27huge market shares in the country of 80
30:30million population so it's a this crunch
30:33across the economy this isn't just about
30:35startups muslin as you know people that
30:38I've met with in Toronto both trips that
30:40I've done and around the country are not
30:42shy to use the word corruption and a lot
30:47of the issues that are are true of
30:49course in many emerging markets China
30:50has been wrestling corruption at a
30:52magnitude that's almost hard to conceive
30:54of and so that's not that this is
30:56unfamiliar territory but I can tell you
30:58when Western investors anyhow look at
31:00new markets dent or rule of law is
31:03essential the ability for people to move
31:05themselves goods and services is
31:07essential the ability to repatriate cap
31:11is essential the ability not to deal
31:13with corruption is very hard and
31:15important can you just talk a little bit
31:18about how you think we should be
31:20thinking about Iran now and knowing full
31:23well that you know the next couple of
31:25years could change and it could change
31:28badly as well as positively how would
31:31you have us think a little bit about the
31:33kind of ability of functioning and rule
31:36of law there sure so there are a few
31:40issues unfortunately Iran doesn't have a
31:43good rank in doing business at this at
31:46this moment but as you as you just said
31:49it's like any other emerging market
31:52which doesn't have a top rank but it's
31:54having a positive progress what we have
31:58seen here is that for example the the
32:02low under regulations has had has
32:05created a lot of barriers for
32:07entrepreneurs both in in the in the
32:10market perspective and also the
32:12operation so talking about examples for
32:18for example creating a company is still
32:20not something that you can do very
32:22quickly so that's been one of the
32:23challenges we have been facing with that
32:27'allah tech for example are creating a
32:28company has taken up to four to five
32:30months sometimes like going back and
32:33forth with the documents which is not
32:35good but government is having specific
32:38campaigns and it's also not only
32:39government there are lots of NGOs trying
32:42to advocate on specific issues which
32:44they believe that our barriers to
32:45private sector and trying to to change
32:48that environment into into a better one
32:51for for the private sector but didn't
32:54get your question specifically like is
32:57it how how we how we think that this
32:59would change over time yeah I don't
33:02think like I have the real expertise to
33:03answer that question but from what what
33:06I observed is that being there having
33:09the government who is very keen to to
33:12solve them of course much more agile
33:15than the previous government I think
33:17that the progress would be there and if
33:19we get absolutely better - we there are
33:21lots of lags still IP is a big issue
33:25but there are different initiatives and
33:29different advocacy campaign to address
33:30them you know most of one of the great
33:32advantages are built in the United
33:34States particularly over the last maybe
33:35five or seven years there's just so many
33:37platforms where entrepreneurs can build
33:39businesses very lightly I mean our
33:41access to cloud computing is had an
33:42enormous ramification for startups
33:44overall sharing economy platforms have
33:46been profound as we've alluded to before
33:48you can make or break a business by
33:51accessing api's and things like Facebook
33:53and Twitter that's still pretty nascent
33:56there how do you think about that as a
33:58benefit or challenge for the startups in
34:01your backyard I think considering those
34:04existing platforms and as required
34:06infrastructure for entrepreneurs I think
34:08we are pretty at a very low level with
34:11this so butBut there are the plat our
34:14platforms being made for example going
34:15back in time if you are an app developer
34:18and you want to you know serve an
34:20application in local market there wasn't
34:22such platform of like cafe Bazaar which
34:24we just talked about it but now there is
34:27a platform where 15 million more than 50
34:29million users are already using it and 5
34:31million people are using it every day
34:33like daily users so those platforms are
34:36being made still access to Twitter to
34:38the advertised Facebook to advertise
34:40Google to advertise doesn't exist in the
34:42country but there are for example a
34:44platform of local display ads Network
34:47which is serving more than 60 million
34:49banners every day but these local
34:51platforms are being made on the other
34:53side we see that the cloud is becoming
34:57the private sector has serious plan the
35:00government is trying to subsidize to
35:02create different data centers and cloud
35:04services in different even the different
35:06regions of the country so the cross
35:09structure is improving the penetration
35:11of the Internet has changed we are now
35:14I wanna we have well now one of the
35:15highest rate of Internet penetration and
35:17smartphone penetration I've just heard
35:20it from the CEO of a mobile operator
35:22here the leading mobile operator that
35:24every month there is 1 million
35:26smartphones being added to the network
35:28of the country so this is this is a huge
35:30growth I mean in terms of payment
35:33although there are lots of services to
35:36be improved that doesn't exist for
35:37example in the economic
35:38description doesn't really exist here
35:40but there are initiatives to solve those
35:43issues than address those issues but
35:45comparing it with the rest of the region
35:48Iran has one of the highest online
35:51payments rates for example now the top
35:54websites are now exploring 20% cash on
35:58delivery and 80% online payments which
36:02is huge I mean comparing it with Arab
36:04countries and even Turkey it says it's a
36:06huge rate yeah so those infrastructures
36:09are really changing rapidly in the
36:10country and hopefully over time when the
36:13sanctions that live there will be more
36:15existing platforms that we can use in
36:17global level and then that's that's
36:19where the entrepreneur's would get a
36:21kick start to build a startup and create
36:24a value in some respects the biggest
36:26surprise I had year-over-year was that
36:28while broadband penetration and mobile
36:31connectivity was as high if not higher
36:33than any emerging market I went to say
36:35things like 3G 4G we're still very very
36:38low and and folks told me a year ago
36:40that they were gonna roll out
36:41aggressively 3G 4G but other businesses
36:44people said now they'll take their time
36:46that's risky I don't think they'll do it
36:47I'm there a year later and there are 20
36:50million plus now subscribers the 3G and
36:524G out of a country of 80 million and I
36:55think they'll get to everyone you know
36:56in very short order I think when people
36:59are walking around with supercomputers
37:01in their pockets it changes everything
37:02can you talk a little bit more about how
37:04mobile is changing the dynamics in Iran
37:06generally and for the startup ecosystem
37:08that's gonna be very much a mobile first
37:11ecosystem I'm sure that over time it's
37:13gonna be mobile first seriously we have
37:15seen a huge growth in mobile adoption I
37:19mean Iranian people are very tech savvy
37:21they really use technology products that
37:25the reason that it has exported now is
37:27that the Iranian mobile users and the
37:30mobile penetration of in Iran is more
37:34than 120 percent it means that everybody
37:36has more than one phone there are people
37:39who have more than one phone but but the
37:43access to Internet over mobile was kind
37:46of limited to some regulations that it
37:49was only provided to the to a third
37:52really use that privilege very well in
37:54expanding the tree G connection in the
37:55country but last year we had this
37:58finished so you can imagine that in a
38:01country with 80 million population where
38:03you have 120 percent smaller 20% mobile
38:07penetration suddenly everything changes
38:09to smartphone talking it of an example
38:12we in first cycle of our tick we had a
38:15startup which was serving females at
38:18home helping them to and empowering them
38:21to create handicrafts seeing a huge
38:24massive traffic by war by by females at
38:27home by woman at home coming from mobile
38:30and these that's the reason these guys
38:32started building a mobile application
38:34instead of rushing into a website
38:36because they because talking to
38:37customers they said that I'm using my
38:40tablet and I'm using my mobile and I
38:42don't want to use my son's desktop for
38:44example one of those frequent questions
38:46I've gotten is I've travel around the
38:47world with this is it's a I think it's
38:50actually a silly mean but you hear it
38:51all the time people will say you know
38:53what's the Silicon Valley of X and well
38:56great cities matter and network effects
38:59of talent the more people who are good
39:01more people are good want to be there
39:03it's not irrelevant I actually have sort
39:06of become convinced it's the wrong
39:07question that that when you have a
39:09mobile empowered anywhere that that's an
39:14opportunity for innovation that's an
39:15opportunity for people to solve problems
39:17that's an opportunity for people to take
39:19control of their economic futures how do
39:22you think about that question when you
39:23look at Iran is - is Tehran in fact to
39:26be a Silicon Valley or is it a really a
39:28broader different kind of approach a new
39:30way to think about economic development
39:33economic region and innovation and
39:37actualization in your country Brad Feld
39:39was just doing blog post money what
39:43Silicon Valley is he was calling it as a
39:45religion in the state of - whatever is
39:48it it is but I think at talking of
39:51Silicon Valley as as a environment where
39:55innovation really boosts and can create
39:57wealth in the inner inner region I think
40:02over the patent seeing the progress of
40:05years I believe that Silicon Valley is
40:07being created in Iran Tata and we have
40:10observed we have been starting observing
40:13it I'm not saying that it's becoming
40:15Silicon Valley maybe even the vision is
40:17not there but we see that more
40:19innovation is happening and we see that
40:22more more businesses are being built
40:24which are to some extent even disrupt
40:27its traditional industries and we are we
40:31have already started observing it and
40:33it's very interesting to see it and I
40:34think 20 2015 is is the tipping point
40:37for for Iranian entrepreneurs I don't
40:40use this word lightly but as I gotta
40:42meet you and a lot of your colleagues
40:44but you know hundreds of them in my
40:45brief trips over there I think you guys
40:47are heroes and the women are heroes
40:49because I think that you're not only
40:52creating a new narrative of because
40:54you've got access to this technology and
40:56are integrating in the world almost
40:58regardless of what governments do and
41:00top-down institutions do but you're
41:02unleashing amazing talent bottom-up
41:05which if we had this conversation five
41:07years ago ten years ago I think would
41:09have been near impossible in many parts
41:11of the world not just Iran and I think
41:13that this a very exciting narrative that
41:15most of us in America don't get a chance
41:18to see but when we hear it in an
41:19understanding and particularly those of
41:21us you know who have built startups and
41:23we've used technology and we know what
41:24can happen with it I think most people
41:26are gonna listen to you today and think
41:28of course why wouldn't it be this way as
41:31opposed to before this conversation
41:33people have this one view of so many
41:35parts of the world in Iran in particular
41:37so it's just been a joy to spend more
41:39time with you and I wish you the best of
41:41luck in all that you're doing yet thank
41:44thank you it was really a pleasure to
41:45talk to you again and as you emphasized
41:48I believe that entrepreneurship is a
41:50common language which has no border
41:52absolutely and we see a lot of
41:55similarities between an entrepreneur's
41:57based in Silicon Valley and the one
41:58based in in Tehran and we believe that
42:01by the way leveraging and you know
42:04synergizing those those type of
42:07characteristics we can we can all get a
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