The recurring crises over the past two years have pushed Iran’s Venture Capital (VC) ecosystem into a state of “alert.” To provide a precise assessment of the situation, the Iran Venture Capital Association (IVCA) has summarized the expert insights of key industry players, originally featured in an exclusive interview with Zoomit. This report highlights the perspectives of Sajjad Zavvar (Secretary of the IVCA), Hassan Zali (CEO of Soroush Sepehr Investment Company), and Mahdi Sadat Hayat-Shahi (CEO of the Creative Industries Research and Technology Fund).
The Chain of Failure: From 2024 Growth to 2025–2026 Stagnation
Following a record-breaking year in 2024, which saw over 16 trillion Tomans invested across 220 deals, the ecosystem is now facing severe structural headwinds in 2025 and 2026. Sajjad Zavvar, Secretary of the Iran Venture Capital Association, warns: “Experiences such as internet disruptions and critical macroeconomic events have demonstrated how directly these factors impact the cash flow and survival of innovative businesses.”
Expert Analysis of the Crisis
1. The Internet: A Critical Infrastructure Under Pressure
Hassan Zali, CEO of Soroush Sepehr Investment, describes the internet shutdown as more than a technical issue: “It means a complete halt to operations.” Zali notes that the lack of data access has disrupted the due diligence and decision-making processes for investors. He emphasizes: “The government must treat the internet as the lifeblood of the economy. Instead of restrictions, policymakers should design modern solutions to ensure stable and secure access.”
Mahdi Sadat Hayat-Shahi, CEO of the Creative Industries Research and Technology Fund, echoes this concern, noting that the core operations of research funds—including project monitoring and financial transactions—are virtually paralyzed without online connectivity.
2. Risk Aversion: The Freeze on Capital
According to Hassan Zali, a volatile economic climate has transformed the inherent “risk-taking” nature of the VC ecosystem into “enforced risk aversion.” This shift has significantly delayed the lengthy negotiation and deal-structuring cycles, threatening the survival of startups that rely on timely capital injections to stay afloat.
3. Startups: Survival Over Growth
Mahdi Hayat-Shahi provides a stark outlook on the current state of portfolio companies: “Most of these firms are now in ‘survival mode,’ not growth mode. The combination of rising costs, energy shortages, and the brain drain of specialized talent has led to an increase in defaults and a total lockdown of the financing pipeline.”
Critical Review of Government Support Packages
Representing the industry’s stance, the IVCA and its members have raised concerns regarding the recent support package from the Innovation and Prosperity Fund:
- Misaligned Timeline: The eligibility window (defined as March 1, 2026, to April 21, 2026) fails to address the cumulative damage caused by earlier crises dating back to previous years.
- Bureaucratic Complexity: Referring funds to commercial banks complicates the process and reduces efficiency.
- The “Time Bomb” of Guarantees: Hayat-Shahi warns that defaulted guarantees have created a systemic risk that must be addressed immediately by the Investment Department of the Innovation and Prosperity Fund.
The Association’s Roadmap for Recovery
Sajjad Zavvar and the participating executives propose five essential pillars for exiting the crisis:
- Recognizing the internet as vital infrastructure.
- Developing new support tools (such as leveraging financial resources and product leasing).
- Reforming tax policies to incentivize investment in distressed companies.
- Expanding the Co-Investment model to distribute risk among financial institutions.
- Targeted support for portfolio companies (supporting funds is a prerequisite for supporting startups).
In summarizing the discussion, Mahdi Hayat-Shahi emphasizes the critical issue of trust: “Funds act as the bridge of trust between startups, investors, and financial institutions. If they are forced out of the cycle due to liquidity crises, restoring this ecosystem will take years.”
Sajjad Zavvar reiterates the necessity of including professional associations in policy-making: “The exclusion of ecosystem representatives from decision-making processes leads to a disconnect from the field’s reality and reduces the effectiveness of any support measures.”
To read the full text of this report, please click here.
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