Case Study 1 — Armenia: Diaspora-Fueled Leapfrog and Deep-Tech Ambition

Armenia presents a model for systematically engineering a knowledge-intensive economy by mobilizing its global diaspora as a bridge to markets, capital, and expertise.

Rather than following a conventional development path, this strategy is framed as a state-supported effort to leapfrog into higher-value sectors, anchored by:

targeted government policy,
diaspora investment structures and networks,
and a focus on deep-tech domains.

Policy tools to attract and retain diaspora-led businesses

To attract and retain diaspora-led businesses, Armenia’s approach combines incentives with “local anchoring” requirements.

One example is the Neruzh Diaspora Tech Startup Program, which provides grants (reported ranges such as $15,000–$30,000) to diaspora-led startups with a key condition: founders must register the company in Armenia and open a local bank account, ensuring that capital and activity contribute to the domestic economy.

This is complemented by a highly favorable tax regime for certified IT companies (commonly described as 0% income tax, 0% VAT, and a flat payroll tax), which reduces friction for early-stage scaling.

Diaspora as a “Global Bridge”

A recurring pattern is founder-led internationalization:

diaspora founders build for international markets from day one,
using networks in the U.S./EU to access clients, talent, and investment.

Physical hubs ("soft landing" pads) can reduce friction in market entry by offering proximity to executive talent and customers.

A concrete version of this is SmartGateVC’s “Hero House” in Glendale, California, which functions as a bridge hub for Armenian founders to access U.S. markets.

Deep-tech focus areas

Deep-tech leapfrogging builds on scientific and engineering capabilities. Common priority domains include:

Artificial Intelligence
Microelectronics
Autonomous systems
Biotech
Quantum technologies

Mega-project acceleration: AI factory as ecosystem infrastructure

Large public–private projects can “supercharge” an ecosystem by:

creating anchor demand for talent,
pulling in global partners,
and positioning the country as a node in global compute infrastructure.

One flagship example described in recent reporting is a $500 million AI factory initiative involving Firebird.ai, the Armenian government, NVIDIA, and diaspora-linked capital (including the Afeyan Foundation). High-level diaspora connections (e.g., senior figures within major tech firms) can play a catalytic role in aligning partners.

Suggested media (from uploaded materials)

Audio supplements (now available on the site):

/podcasts/lessons-armenia-china-india.m4a
/podcasts/china-innovation-engine.m4a