Why Most Georgian Companies Innovate Alone — And What the Ecosystem Is Missing

Innovation is often seen as a product of collaboration — between businesses, universities, research centers, and technology partners. But in Georgia, the reality looks quite different: most companies implement innovation independently, without engaging with external actors.

According to 2024 data, 81% of process innovations and over 81% of product innovations were developed solely by the enterprises themselves (Geostat, 2025). Only 22% of cases involved any form of collaboration with other companies or institutions, and even fewer were based on modifying or adapting innovations created elsewhere.

This pattern reveals a significant weakness in Georgia’s innovation ecosystem — a lack of cooperation and shared development culture. Globally, one of the main trends in innovation is precisely collaborative models. For example, through the Horizon Europe program, thousands of EU projects are implemented via tight partnerships between businesses and universities; in Germany, the Fraunhofer Institutes serve as a vital bridge between science and industry.

In Georgia, such platforms are either underdeveloped or underutilized. The reasons range from a lack of trust in the academic sector to limited organizational capacity or resources for managing joint projects.

Why does collaborative innovation matter? Firms that work in isolation usually produce smaller, incremental improvements — like tweaking internal processes or slightly upgrading an existing product. But innovation that emerges from the convergence of diverse disciplines, experiences, and perspectives tends to be larger in scale and more transformative — the kind that creates new markets or reshapes existing ones.

In-house innovation also often lacks access to cutting-edge research or emerging technologies, as most companies do not have the capacity for deep R&D. The result: what may seem new for the local market could already be outdated globally.

Internationally, strong collaboration leads to more sustainable innovation outcomes — research-based products, market-fit solutions, and customer-focused services. This is made possible by both public funding and institutional support: innovation hubs, shared labs, and incentives that promote business-academia partnerships. In Georgia, such mechanisms are still limited.

If Georgia wants to move into a more advanced stage of innovation development, it will need more than technical upgrades — it will need systemic incentives for collaboration: grant programs, joint infrastructure, deeper public-private partnerships, and a stronger role for universities in shaping business strategies.