New Company Registrations in Turkey Fall 13%

- The Central Bank of Turkey's benchmark policy rate was 37% at the start of 2026, following a 1-percentage-point cut that was smaller than market expectations. The country's interest rates have averaged 57.58% since 1990, reaching an all-time high of 500% in 1994. - This recent decline in company formation follows a trend from 2025, when more than 113,700 new companies were established, a 1.5% decrease from 2024, while company liquidations rose by 1.8% to over 32,700. - Venture capital funding for Turkish startups experienced a sharp 45% decline in 2025, totaling $589 million, with no Series C or later-stage investments recorded during the year. This trend has accelerated, with funding in the first two months of 2026 down 97.3% compared to the same period in 2025. - While domestic investment has slowed, startups founded by the Turkish diaspora are attracting significant capital, raising $1.1 billion in 2025 and producing three new unicorns: Airola, Periodic Labs, and Fal. - Fintech and gaming startups captured the vast majority (68%) of all domestic venture capital deployed in 2025. In contrast, AI startups accounted for 25% of all investment deals but attracted a much smaller share of the total funding. - A late 2025 trend saw investor interest pivot from AI towards deep tech, including robotics, defense technologies, and biotechnology. Turkey is home to 653 deep tech startups, with companies like Milvus Robotics developing autonomous mobile robots for logistics. - Climatetech is also an area of activity, with social enterprises like Ecording using autonomous drones to deliver seeds to hard-to-reach areas for afforestation efforts. - Despite the current slowdown in business creation, Moody's forecasts that the Turkish economy will grow by 3.4% in 2026