Despite being the new kid on the block, Tbilisi has created a promising ecosystem for startups, with Startup Genome estimating its economic value to have exceeded USD 240 million at the end of 2024. A pittance compared to the likes of Silicon Valley, perhaps, but we’re talking about more than just numbers.
Any young IT company with a breakthrough idea will be looking to attract funding, and thanks to the basic nature of emerging markets this can be easier to find in Georgia than in the USA, Europe, or China. There is no shortage of investment programs from public and private business angels, and recent legislative initiatives facilitate the growth of companies by shielding funders from income tax.
We have chosen the Georgian startups we fell best demonstrate the possibilities that await internationally and locally oriented technology businesses in Georgia (and some outside these categories altogether).
CityPay.io: cryptocurrency and fintech
Founded in 2020, CityPay.io was one of the first in the region to develop a payment platform that allows businesses to accept and instantly convert payment for goods and services in cryptocurrency to fiat. Now the company has 600+ partners in Georgia, including such international companies as Radisson Blu and Boulevard Hotels. CityPay.io also works with individuals and has plans to enter the cryptocurrency payment card market.
Despite the relatively niche nature of its solution, the startup is actively attracting investment. It received more than USD 2 million (including USD 500,000 in cryptocurrency) in seed funding in 2023 from venture capital fund Presto Ventures and Tether, the company behind the world’s most popular stablecoin, USDT. A year later, Tether increased its investment in CityPay.io as the main partner by another USD 10 million.
If you are also interested in entering the Georgian cryptocurrency market, PB Services can help you obtain a crypto license from the National Bank. We wrote about the process (and how long it can take) in the GeCrypto case study.
Humanode: decentralized blockchain
There are a number of things that make this international startup unique. Humanode has built its own infrastructure at the intersection of blockchain and biometrics using Polkadot.
In a nutshell, Humanode is designing a network that uses Proof-of-Uniqueness and Proof-of-Existence protocols to confirm humanity (not identity) and access a node with a face scan. Such is the price of an honest, fraud-proof digital economy and what differentiates this project from so many others where the large cryptocurrency holders and miners manage to stay at the helm. In 2024, Humanode became the most decentralized blockchain in the world with a record-breaking Nakamoto Coefficient of 236.
Since its founding in 2020, Humanode has raised USD 23 million in investment (roughly half through IDO). International venture capital funds Republic Capital, AU21 Capital, and Big Brain Holdings, among others, are all shareholders.
Theneo: artificial intelligence and APIs
Launched by Georgian developers who used to work for Google, Microsoft, and Twitter, Theneo uses AI tools to generate API documentation in demand among other programmers and is currently being used by 15,000 companies, mostly from the US.
Theneo is a participant of the Georgian startup incubator Axel and the legendary Y Combinator that the likes of Airbnb, Dropbox, Twitch, Reddit, Stripe and hundreds of others have called home in their time. Theneo’s founders have raised about USD 2 million (at least USD 1.5 million from Y Combinator).
DataMind: banking analytics
A comprehensive Data Unistream platform for managing data in the financial sector, DataMind includes a warehouse, reporting automation systems, tools for risk and profitability analysis, and an AI-based assistant.
DataMind works with 70% of the banking organizations in Georgia and plans to enter the international market in the Baltic States, Eastern Europe, Central Asia, and the United States. Total investment in DataMind exceeds USD 700,000, and the company has been valued at over USD 2 million.
Elven Technologies: EV security
Elven develops fire systems for lithium-ion batteries. Their main product is a fire-resistant enclosure capable of withstanding multiple 2,000 °C combustion cycles.
Elven is currently working on six pilot projects related to electric cars, aircraft, and battery transportation in Estonia, Germany, USA, and Mexico. The market is bigger than it seems: according to statistics, Tesla models have been bursting into flames (the lithium-ion battery, to be more precise) at a rate of 25 out of 10,000. In the five years since its founding, Elven has raised about GEL 1.5 million (USD 550,000) through grants and business angels.
Other projects or note
- Promofy helps brands gamify marketing activities without having to program and is currently making headway in the former CIS, EU, and Latin America with investment of about USD 1.2 million.
- aPaW is developing a kind of classfeed for pet owners to find pet grooming, transportation, and training services. The company was founded in 2024 and has raised USD 500,000 from private investors.
- Quickshipper is an SaaS platform for managing internal courier services. Its main customers are based in Bulgaria, Estonia, Greece, and Ghana. Quickshipper recently signed agreements with delivery services Glovo and Wolt that should accelerate international expansion and has raised USD 450,000 in funding so far.
- Helio AI is Georgia’s first AI-driven digital recruitment platform. Helio has raised GEL 1 million (USD 370,000) in investment to date.
- Cargon is a freight-forwarding logistics service that connects shippers and carriers. It has offices in Georgia, Armenia, Azerbaijan, Uzbekistan, and Kazakhstan. It has raised USD 270,000.
- Ensofy uses AI to identify voice markers and analyze the mental state of patients. It has received USD 160,000 from HosmartAI.
- Kings International provides an edtech platform for online academic competitions that is currently free in Lithuania, Bulgaria, India, and Azerbaijan. It plans to expand to Bangladesh, Kazakhstan, Poland, Romania, Romania, Serbia, and Pakistan soon. It has raised more than USD 100,000 so far.
The list is not exhaustive. Aggregator sites count about 100 startups in Georgia, but in reality there are even more. We can get a slightly better idea about the true scale from Galt & Taggart’s 2024 report on the state of the technology sector. According to the report, there are 24,000 IT companies in the country, 84% working for the international market and generating almost USD 1 billion in export revenue.
As for popular areas of focus, Startup Blink estimates that up to 39% of all venture capital investments are related to fintech, edtech, and logistics. According to Axel, 38% of deals are related to fintech, 13% to software development, and 9.5% to agrotech innovations. Medicine, marketing, and Web3 are also in demand.
Why Georgia is a great place for startups
- First of all, the country ranks second in the world in terms of ease of starting a business, according to the World Bank. You can literally open a company in one working day. At the same time, there are no restrictions on foreign nationals, who can be directors and own 100% of the company.
- Second, the country has some of the lowest taxes in the world. IEs with small business status pay only 1% of turnover (up to GEL 500,000), which is not a bad option if you’re just starting out. Most companies (LLC, JSC), in turn, are exempt from profit tax if the profit is not distributed (the so-called Estonian model of taxation).
- Third, the country has a lot of preferential programs for business that can reduce taxes even more. Manufacturers can participate in Free Industrial Zones, and IT companies can join the Virtual Zone or get International IT company status that will fully exempt them from dividend tax and/or income tax even in the case of distribution. We compared these regimes in a separate article.
- Finally, in the fall of 2025, changes to Georgia’s Innovation Act will go into effect. Companies that receive GEL 100,000 investments from business angels or GEL 150,000 from state funds will be able to claim Innovative Startup status that comes with tax preferences for up to 10 years. In the first three years, they are exempt from income tax on employee salaries, in the fourth year the rate is 5% (instead of the basic 20%), and in the last three years it is 10%.
Where to look for funding in Georgia
Access to venture capital is an important factor in the success of any startup. The ecosystem in Georgia might be young, but there are quite a few ways to get support.
Georgia’s Innovation and Technology Agency (GITA), a state entity within the purview of the Ministry of Economy, is one important player. GITA has already funded about 400 startups, 15 receiving grants of GEL 650,000. The agency also works with 500 Global in Eurasia to help companies find private investors.
Business angel networks are gaining in popularity in Georgia. Perhaps the best example is Axel, with more than 100 investors. Angel lists are also published by the AngelMatch portal, and entrepreneurs are supported by Startup Georgia, Impact Hub Tbilisi, Startup Grind Tbilisi, and the University of Georgia (within the framework of the I-Corps program).
As can be seen, many Georgian startups receive funding from foreign foundations, some ready to dish out more than USD 500,000 of seed capital.
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