What problems do startups face in Armenia and how can they be solved? Interview with the head of Brain Fors

IT startups in Armenia face a number of local and global problems, from global instability to improper tax policies and personnel issues. NEWS.am Tech spoke with Gurgen Gharibyan, CEO of Brain Fors, about these problems and how they can be solved.

Local and global problems

The most important global problem that many local companies suffer from – and many foreign ones too, by the way – is instability in the world. Sometimes a company focuses on a market, but problems start in the country it is interested in, and the company loses that market. And this can happen so quickly that the company does not have time to make a “plan B” or implement it.

For example, before the events in Ukraine, companies and startups operating in Armenia received many orders from Ukraine. And then all these companies suddenly lost their contracts. Similar problems were also caused by the events in Israel and a number of other countries. Moreover, many European countries have recently begun to pay more attention to military projects, and economic projects have faded into the background. All this has created many problems for IT companies - both in Armenia and around the world.

As for local problems, an important place among them is taken by tax policy, which today makes the country less competitive in the world: in countries with better tax policy, the IT sector is developing much more actively today.

There is also a problem with human resources - sometimes there is a shortage of specialists. Moreover, if it is still possible to find technical specialites, it is much more difficult to find specialists in sales, marketing, and so on. As a result, a company can create an excellent product with interesting technical solutions, but due to problems with organizing sales, perhaps few people will know about this product, and it will not have the success it deserves.

What to do?

Of course, there is little that can be done in Armenia with global problems. But to solve local ones, according to Garibyan, it is necessary to develop a strategy for the development of the IT sphere, which would determine how and in what direction the sphere should develop, how the set goals should be achieved, what specialists the country needs (many low-skilled people doing a large volume of low-paid work, or a small number of highly qualified people who work little and get paid a lot), and so on.

According to Garibyan, it is the state should be engaged in developing such a strategy, but taking into account the assessment of the country's real capabilities and listening to representatives of the IT sector and understanding their requests and problems. Ideally, this strategy should also determine who and how can train future specialists - and a whole range of other issues.

And to solve the problems with personnel, it is necessary, of course, to develop IT in the regions of Armenia so that their potential is not wasted.

Gyumri - a role model for other cities?

Gurgen Gharibyan is one of the participants of the Silicon Mountains Shirak technology summit. According to him, during the panel discussions, a number of interesting topics were touched upon, but they all came down to one thing – what is needed for the development of the regions of Armenia and what important role human capital plays in this issue?

"The human factor is extremely important for any company, but for startups it is twice as important. The whole business is built on qualified specialists. But the problem is that in regional cities there are fewer such specialists than in Yerevan. And even those who are there are not easy to retain in the regions – many leave for the capital," Garibyan said in an interview with NEWS.am Tech.

In Gyumri, however, this problem has been solved, and that is why there are more technology companies and startups in this city today than in any other regional city in Armenia.

How was this achieved?

It all started, according to Garibyan, with education. Back in 2008-2009, a technology center opened in Gyumri, where, among other things, they also began to teach various IT professions. Many of the people who received an education there eventually moved to Yerevan, since there was little work in Gyumri and the quality of life was lower.

But there were also those who stayed in their hometown, and IT companies and startups began to form around them, which, in turn, began to contribute to the development of the entire city and improve the quality of life in it. More and more IT specialists with competitive salaries began to live in Gyumri, and thanks to them, the restaurant business, the service sector and a number of other areas began to develop. The developing infrastructure began to attract even more individuals and companies - and thanks to all this, the situation in the city continued to improve.

Brainfors is one of the companies that was founded and continues to operate in Gyumri. According to Garibyan, the company currently has 24 employees, all of whom are local.

The Silicon Mountains Shirak forum was held on July 4 in Gyumri. The event was organized by UEICT with the support of the Ministry of High-Tech Industry of Armenia. The Platinum Partner of the forum is Unicomp, the Fintech Partner is EasyPay, the Tech Partner is Ucom, the Silver Partners are Synopsys Armenia and Ovio. Regional and Youth Representation Partner is the Gyumri Technology Center implemented by the Enterprise Incubator Foundation, and the media partner is NEWS.am Tech.