10 Causes of Iranian Business Failure to Add to the CB Insights Study
A study conducted by CB Insights in the United States examined 20 reasons startups fail.
The study has been translated into Persian and cited and used in Iran.
Although these 20 reasons or factors are very important, the report should not be used unchanged in Iran without adapting it to local conditions.
For example, the study was conducted in the United States, which ranks among the best business environments. Citing it directly without adjustment in Iran, whose business-environment ranking is at least 100 places lower, does not seem appropriate.
In a series of articles, I will examine the 20 business-failure factors identified by CB Insights. Below, however, are factors present in Iran's business environment in addition to those 20.
Iran's poor business-environment ranking, which incorporates many other factors.
- Sudden, overnight changes in policies and laws.
- Parallel legislative bodies and legal authorities whose behavior can sometimes be impossible to understand or predict.
- Almost half of access to the free flow of information, infrastructure, platforms and tools needed by businesses has been blocked to Iranian businesses by Iran itself, and the remainder by the rest of the world. Every Iranian business has to bear substantial additional, unnecessary costs for matters that businesses in almost the entire rest of the world do not have to pay for.
- The almost complete severance of Iran's financial connections with the rest of the world and the enormous costs of working around that disconnection.
- In principle, products from the United States face no restriction on marketing and sales anywhere in the world. Iranian-made products, however, are difficult to sell and sometimes require changing the stated country of origin.
- Unrestrained inflation and the continual decline in the value of the national currency.
- Severe psychological and economic insecurity in society, whose consequences require a separate article.
- Excessive uncertainty about the country's political and economic outlook, or alternatively a discouraging outlook, which prevents long-term business planning.
- Iran's weak and negative national branding, which casts a shadow over Iranian-made products and services.