The existence of an investment market is crucial for the development of a startup ecosystem. It provides innovative startups with the financial resources necessary for growth. In Georgia, Axel plays a significant role in this direction.In Georgia, Axel,an angel investors network, plays a significant role in this regard. It connects startups with angel investors and facilitates the finalization of investment deals.
Medscriptum spoke with Iro Tsagareishvili, Managing Director of Axel. She shared her insights on the organization’s activities, its mission, the potential of the healthcare technology sector, and Axel’s role in the development of the startup ecosystem.
Arsen Sebiskveradze: As Axel,Managing Director of the Georgian Angel Investors Network, how would you describe the organization’s activities and its main mission?
Iro Tsagareishvili: Axel, also known as the Georgian Angel Investors Network, was founded four years ago. Its main mission is to connect startups with investors. The company facilitates the entire process required to link a startup with an investor and secure an investment deal.
Axel currently unites around 100 investors. These are experienced professionals who have accumulated not only financial capital but also significant experience and contacts in various industries. They are ready to dedicate their resources—both financial and social—to potential portfolio startups.
Axel invests in all industries and sectors. Currently, the organization has 30 closed deals, with a total of $1.3 million in investments made. Although investments are primarily in Georgian companies, Axel also has experience investing in Swedish, French, and American companies.
Our goal is for the angel investor network in Georgia to reach the level of developed ecosystems where similar organizations invest hundreds of millions of dollars in startups.
Arsen Sebsiskveradze: What inspired the Axel team to start investing in Georgian startups, and what generally motivates you to contribute to the development of the Georgian startup ecosystem?
Iro Tsagareishvili: The main motivation behind establishing Axel was the limited access to financial resources for startups in Georgia. Axel’s founding partners were involved in building the Georgian startup ecosystem from 2015-2016 and clearly saw the existing problem: after receiving funding from the Innovation and Technology Agency (GITA), which was the primary source of funding at the time, startups often couldn’t develop further due to a lack of capital. Many potentially successful projects stalled for this reason, while startups with similar ideas in other markets became successful companies.
The investment process in Georgia wasn’t structured. That’s precisely where the Axel team saw an opportunity to solve this problem. Axel was founded with the participation of about 20 potential angel investors. From the beginning, they had a desire to help the ecosystem. My reason for joining this team was precisely the difficulties I personally experienced—the lack of access to capital for a startup founder. In short, the organization’s goal was to create an investment market for startups.
Arsen Sebsiskveradze: In your opinion, what role has Axel played in the formation and development of Georgia’s startup ecosystem?
Iro Tsagareishvili: Axel is a member of the European Business Angels Network (EBAN), which gives the organization and its portfolio startups access to nearly 80 angel investor networks across Europe. Axel’s over 100 investors have connections throughout Georgia, Europe, Central Asia, and the Caucasus. Beyond just investment, Axel helps startups enter foreign markets, attract clients, and forge new partnerships. This embodies the “Smart Money” principle, which means sharing experience and contacts alongside financial capital.
To increase interest in Georgia, Axel organizes a large annual investment event where investors come to visit. Also, Axel’s representatives frequently attend various events worldwide, where they present Georgia’s startup technological ecosystem as part of the Georgian delegation. In doing so, they contribute to increasing the country’s international recognition.
Axel is involved in various aspects of ecosystem development. Member investors actively participate in accelerator programs as mentors and trainers. Axel also lobbies to connect startups with other investment funds, helping them attract investments and acquire new clients. Ultimately, all of this—especially the focus on information technology (IT), where Georgia has strong IT talent—contributes to the country’s economic development and the creation of a favorable entrepreneurial environment.
Arsen Sebsiskveradze: According to our information, Axel actively helps startups working in the field of medicine and healthcare technologies to find investors. What led to this interest in this sector? What potential do you see in this field?
Iro Tsagareishvili: In Georgia, we don’t have the luxury of choosing one specific industry for Axel to concentrate on, nor do we want it to be that way. Our doors are open to everyone. What we observe most closely are the founders and the product development team. A startup’s idea, product, and market can change many times over the years, but what doesn’t change is the team. This was precisely the initial motivation when startups from the healthcare sector approached us. We were first impressed by their teams, and then by everything else.
In addition, we believe that Axel has introduced the practice of high-risk capital investment for startups in the market. The healthcare sector in Georgia is quite a closed space, so we saw our role as a “game-changer.”
Arsen Sebsiskveradze: How do you think Axel, as an angel investor network, contributes to encouraging innovation in the field of healthcare technologies?
Iro Tsagareishvili: At this stage, Axel has invested in two startups, though technically three deals have been made because one of the startups received investment twice. We believe that both startups contribute to increasing access to healthcare services and medications for the wider public.
Startups in the healthcare sector are fundamentally changing the quality of service, which is especially important for Georgia’s healthcare sector where service quality and accessibility need improvement. Our goal is for these startups to not be limited by Georgia’s borders and to expand into the international market as well.
Generally, healthcare technologies are developing globally, but they aren’t at the same stage as, for instance, the fintech sector and other areas. We believe we’ve made our mark here. However, Georgia still significantly lags behind the world in this regard. For example, healthcare technologies are particularly important for European Union countries.
The development of biotechnology is currently highly relevant, and there’s active work on this topic globally. Unfortunately, the Deep Tech sector is not well-developed in Georgia, which is precisely why Axel is more focused on funding Software startups.
Arsen Sebsiskveradze: Regarding these specific startups, tell us how they are changing the healthcare sector and, in your opinion, what impact will they have on healthcare at a Georgian or regional level?
Iro Tsagareishvili: In my opinion, the healthcare technology sector is the industry of the future. Through the startups we fund, we are fostering the development of digital services within the healthcare sector. It’s hard to say if a full-fledged digital healthcare ecosystem will emerge specifically from them, but steps in this direction must certainly be taken.
When a startup receives funding in a specific sector, it acts as an encouragement for other founders as well. They see that there is interest in that area and that high-risk capital is being invested. Consequently, they too become more willing to launch their own startups. Ultimately, our investments aim to digitize services, increase accessibility, and develop telemedicine. There’s also interest from the state in this direction, and beyond.
We have a serious lag globally in research and hardware development, but Georgian startup founders are quite strong and developing very well in applications and software development.
Arsen Sebsiskveradze: Would you share with us any specific startups that Axel has helped in the field of medical technologies?
Iro Tsagareishvili: For example, the startup “Mediki”, which offers digital medical services to users and simplifies access to medical services, is precisely powered by Software technology.
I would also highlight another Georgian startup that is not yet in our portfolio: BiteriumAI. This is an Artificial Intelligence-focused technology company. It helps individuals prevent cardiovascular diseases by 70% at an early stage. Additionally, it offers healthcare providers an AI-based SaaS solution that accelerates the diagnostic process, ensures accurate treatment, and saves time.
Arsen Sebsiskveradze: In your opinion, where is Georgia today in terms of healthcare technology development in a global context?
Iro Tsagareishvili: Today, the healthcare sector has numerous internal, unregulated processes, and their digitalization and automation will significantly improve the situation. For example, we have problems with the reservation system, and communication between insurance and clinics often happens via email or phone calls, which is inefficient.
There’s a lot to fix. First and foremost, businesses need to recognize their own problems and speak about them loudly so that startup founders think more about these challenges and work on ways to solve them. Businesses should have a strong interest because it’s profitable for them in terms of saving finances – they need to understand that the resources spent today will bring long-term profit to their business. It’s precisely this lack of vision that is the problem today. As I mentioned, the healthcare sector is quite a closed circle, where entry is not easy, but these approaches are changing very slowly, but still changing.
Arsen Sebsiskveradze: What is Georgia doing, as a country, to promote innovation in the healthcare sector?
Iro Tsagareishvili: There isn’t much to say that a lot is being done. The Georgian Agency for Technology and Innovation (GITA) is an umbrella organization that generally helps startups, but GITA is not, nor should it be, concentrated on one specific industry; it supports startups across all sectors.
The problems we have are analogous in the Caucasus and Central Asia. We believe that helping such startups means they will transcend Georgia’s borders once they thoroughly develop a test product in the local market.
The second issue the state should work on is opening doors for startups, ensuring data accessibility for them, and helping establish communication with various medical institutions. The healthcare sector is quite a closed circle, and it’s difficult to penetrate it if you don’t have experience in this field.
Often, digital services are created within the company itself, which is justified in some cases, but sometimes unjustified. It’s possible for a brilliant external team to create all of this with greater interest and even in the role of a founder. We’ve seen many unsuccessful projects in healthcare technology that an actor started but couldn’t bring to fruition.
Beyond that, clinics face a major problem: a shortage of IT personnel. These are the specialists who can actually work on and integrate specific startups into clinics and companies. There’s a need for this, and the government could partially lobby to ensure this process runs effectively.
It’s a justified practice for large businesses to organize hackathons and ideathons in general, but this doesn’t happen in the healthcare sector. I don’t like it when the state does everything. The role of business is also important, and it should take on the development in this direction together with the state.
Healthcare businesses facing technological challenges should entrust their projects to young startup teams. I’m confident these teams will create excellent innovations to address these challenges—much better, in my opinion, than the companies’ in-house teams could.
Discussions need to start on this, and both businesses and the state should open their doors more to startups.
Arsen Sebsiskveradze: How do you see Georgia’s potential in healthcare technology? Do we have a unique niche or a general direction where we can excel?
Iro Tsagareishvili: In my opinion, Georgia’s competitive advantage lies in software development. I believe we can create many interesting digital services and products that the healthcare sector genuinely needs. I want to emphasize again that we have very strong IT specialists working in various companies, both within Georgia and abroad.
The other area where we have a serious shortfall is the development of Deep Tech, which is based on the commercialization of scientific research. There’s a vast amount of resources for this in Georgia. Many applied science research institutes operate within various universities and independent organizations, possessing immense knowledge and numerous brilliant projects sitting on shelves. Many involved parties are trying to commercialize these projects, but in my opinion, until the younger generation, students, get involved—meaning the generation that understands what a startup is and how it’s done—these studies will remain on the shelf.
It’s disheartening to see the technologies being discussed abroad when we’re only focused on software. Indeed, Georgia has many talented individuals in software development today. This potential exists, but it’s not being encouraged by the state. We have significant opportunities in this area, and in my opinion, we absolutely must utilize them.
Arsen Sebsiskveradze: What specific steps is Axeli taking to unleash and strengthen this potential?
Iro Tsagareishvili: First and foremost, we strive to gain an in-depth understanding of various industries because our network members are represented in almost every sector. We aren’t narrowly specialized experts in specific fields; we possess a certain level of knowledge and experience across all areas.
A significant part of our work involves researching international trends. We study what’s happening beyond the country’s borders. Currently, there’s a big boom in the healthcare sector, specifically in Deep Tech. In Georgia, there are almost no startups in this area. We might recall one or two, or perhaps a startup founded by a Georgian abroad, which can’t really be considered Georgian.
Our mission today is to gather as much information as possible about best practices outside of Georgia so we can implement them in our country.
Secondly, we offer healthcare technology startups the opportunity to come to us and secure funding. Our mission isn’t limited to just investment; our primary goal is to create social good for tomorrow. We want to use technology to improve a sector that, in our country and generally in the post-Soviet space, isn’t in a very healthy state. I believe technology is the path to democratizing any sector and increasing consumer access to various services, and that’s precisely our ultimate goal.
Arsen Sebsiskveradze: If someone is reading this interview now and decides to start their own startup in the field of medical technology today, what is the single most important piece of advice you would give them?
Iro Tsagareishvili: My main advice is: don’t start a startup until you’ve researched that there’s a real need for your product. The market is indeed difficult, but it’s not unmanageable. There are startups, including some from our portfolio, that are successfully navigating this market. It’s a large market full of challenges, and you need to know how to work with it.
I believe healthcare is a field where certain experience is essential to pave your way more easily afterward. Generally, this holds true for all industries.
However, before entering such a complex industry, a deep understanding of the market is essential. You shouldn’t act blindly—this could lead to many obstacles and, over time, completely diminish your desire and motivation to pursue a startup.
