How Central Asia Can Shape Global Business

Erik Aubakirov, serial entrepreneur and CEO of EA Group Investment Holding.

Central Asia is undergoing an economic boom, transforming from a region known for its natural resources into a vibrant hub of innovation.

What you need to know about the region, which includes Kazakhstan, Uzbekistan, Kyrgyzstan, Tajikistan and Turkmenistan, is that VC investment has increased over the past five years, with local startups demonstrating the unique opportunities for investors and leaders who want to conduct business in the region. Many of these opportunities lie in FinTech, AI, HealthTech and PropTech.

With strong government support and a young, educated population, Central Asia is well-positioned to become a significant hub for global venture capital.

The Growth Of The Technology Scene In The Region

Today, the CCA region is experiencing rapid development, with venture capital investments increasing 5.5 times over the past five years, outpacing the growth seen in the Nordic countries. This surge is more than just numbers; it reflects a fundamental shift in the global technological landscape.

A few numbers from a RISE research report provide a clearer picture:

• Kazakhstan leads the region. From 2018 to 2023, the number of venture capital transactions has increased more than sixfold, while the average transaction size has grown 3.8 times during the same period. More than 50% of these investments come from international business angels and venture funds.

• Venture capital investments in Uzbekistan doubled in 2023 compared to the previous year, with the total number of transactions increasing by 1.42 times. Notably, Uzbekistan saw the emergence of a unicorn in 2024: the Uzum IT company. Meanwhile, Kazakhstan’s fintech giant Kaspi.kz moved to NASDAQ, with an estimated valuation of $17 billion.

In five years, CCA startups attracted $110 million, which yet is quite modest but with strong potential for further growth.

Synergy Between Regional Startups And Global Technological Trends

The Central Asian tech industry doesn’t just follow global trends—it makes a unique contribution by developing solutions that bridge Eastern and Western markets.

For example, the fintech startup S1lkPay recently received a U.S. patent for its innovative distributed payment processing system. S1lkPay enables users to instantly share access to their funds with friends and family worldwide and seamlessly distribute payments.

I can’t overlook the startup that marked the beginning of our venture capital journey—Parqour. Their technology has helped many companies automate parking processes at commercial facilities. Today, Parqour operates in 17 countries, with a focus on four regions: North America, MENA, Asia Pacific and Central Asia.

Perhaps the most notable success story from Kazakhstan is Kaspi.kz, a company that combines a marketplace and a bank. Today, the majority of Kazakhstan’s population uses the platform. In 2024, Kaspi.kz announced plans to expand into Uzbekistan and just recently Kaspi.kz acquired the biggest Turkey’s marketplace Hepsiburada. The success of Kaspi.kz has significantly strengthened the relationship between international investors and Central Asia. The 2024 IPO on the Nasdaq stock exchange, which valued the company at nearly $18 billion, showcased the region’s potential to global investors.

Startups in educational technologies, telemedicine, e-commerce and clean energy are thriving in our region, with many showing strong potential for global scaling. Central Asia combines strong technical expertise with the region’s cultural diversity, enabling the creation of innovative solutions relevant to the global market. This presents unique opportunities for international investors and businesses entering the region.

Opportunities For International Leaders In Central Asia

The region’s growing market, talent, government support and strategic location make it ideal for investment from investors, entrepreneurs and business owners. From market growth to highly qualified personnel, the region offers businesses and investors ample opportunity to grow. It’s also important to note that Central Asian governments help promote the development of the technology sector through various programs, tax incentives and infrastructure projects. With a strategic location at the crossroads of Europe and Asia and the oft-overlooked potential presenting attractive deals with more favorable terms compared to overheated markets, businesses have plenty to consider when participating in the Central Asian market.

In terms of industry sectors to consider, it’s important to note that in 2023, startups in FinTech, along with AI (artificial intelligence), HealthTech (healthcare technologies) and PropTech (real estate technologies), attracted the most interest from venture investors in Kazakhstan.

FinTech startups are also gaining popularity in Uzbekistan, leading in both investment volume ($2.75 million) and number of transactions (12). Additionally, LogTech projects ($1.775 million) and business management startups ($975 thousand) are among the top sectors in terms of investment, according to the same report from RISE research.

That said, there are risks. For instance, the regulatory framework for technology companies and foreign investments in many Central Asian countries is still in its early stages. For example, online platforms are requested to be hosted locally in Kazakhstan. The personal data of Kazakhstan citizens must also be stored locally. IP regulations are yet underdeveloped, which is why intangible assets are valued less than in the U.S. Some fintech companies, especially those dealing with crypto, are only allowed to register and do business in AIFC—a free economic zone.

Additionally, the region’s location makes it vulnerable to geopolitical tensions. Surrounded by sanctioned countries, Kazakhstan’s business is balancing benefiting the country’s geographic position and being able to comply with international requirements. Thus, you have to do thorough due diligence for all your business partners and avoid risks of sanctions.

Cultural differences are another important factor. Business practices in Central Asia can vary significantly from those in the United States or Europe. I strongly recommend partnering with a reliable local expert to help navigate these differences and avoid potential mistakes. For example, before entering the Central Asian market and getting consultants’ support, make sure your consultancy has a local presence and runs some similar projects. Like the big four firms, for example—they all are present here and have local staff and expertise.

What Lies Ahead For The Region?

Central Asia stands at the brink of a technological breakthrough, with AI and FinTech leading the charge.

For forward-thinking investors, entrepreneurs, and other business owners, this untapped market holds potential not just for high returns but for pioneering the next wave of global tech solutions.

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