MIT Orbit Recommends Georgian SMEs as the Prime Market for B2B SaaS Startups

Small and medium-sized enterprises (SMEs) have long played a central role in Georgia’s economy, but the recent acceleration in digital transformation has significantly reshaped their technological needs. With over 231,000 small businesses—representing 78% of all enterprises—this segment not only accounts for a major share of employment but also forms a vast, largely underserved market for digital solutions.

While large companies are already adopting complex IT systems, SMEs in Georgia are increasingly looking for simple, cost-effective, and results-driven software. This is precisely where the SaaS (Software-as-a-Service) model offers value—providing easy-to-implement tools for accounting, CRM, marketing automation, and analytics, without the need for major infrastructure investment.

Since the COVID-19 pandemic, digital intensity among Georgian SMEs has grown. More companies have upgraded websites, adopted digital payment systems, and moved customer interaction online. Yet these steps often lack strategy and consistency. This gap presents a unique opportunity for SaaS startups: those that can clearly identify the needs of this market and design lightweight, intuitive, and targeted products stand a strong chance of breaking through.

Several government and donor-backed initiatives are also encouraging SME digitalization in Georgia. However, challenges remain—particularly low levels of digital literacy, limited financial capacity, and a general lack of awareness about the value of digital transformation. This means SaaS providers must do more than sell software—they must build trust, offer onboarding support, and sometimes act as educators.

Compared to other segments like public institutions or healthcare, SMEs have fewer bureaucratic hurdles. While the government sector requires lengthy procurement procedures and healthcare demands compliance with strict data regulations, SMEs can adopt tools more flexibly and make quicker decisions when they see clear value.

Global experience confirms this pattern: in many countries, the initial customer base for successful SaaS startups emerged from the SME sector, where decision-making is decentralized, and change often stems from owner-level initiative.

It is based on these structural, behavioral, and policy dynamics that the MIT Orbit framework, applied through the BTUAI research, recommends SMEs as the optimal entry point for B2B SaaS startups in Georgia. The report, “B2B SaaS Ecosystem Market Analysis in Georgia from a Startup Perspective”, uses Orbit’s disciplined entrepreneurship methodology to identify this segment as offering the best combination of size, digital momentum, and realistic barriers for a startup’s initial growth. Please find the full report here.