In recent years, the global startup ecosystem has witnessed significant growth, and a promising market for technology-based innovations is emerging in Iran. However, Iranian startups face a unique set of challenges, especially in the field of software development. This study examines the multifaceted challenges that hinder the success of software development projects in Iranian startups. For this purpose, by studying the research literature, 14 major challenges in this field were identified, which were divided into four categories: economic and political challenges, technological, cultural and organizational challenges, and specific challenges for startups. The results of this study showed the significant impact of sanctions and internet restrictions that limit access to essential technologies and global markets. In addition, domestic challenges, such as outdated technology, lack of skilled labor, and bureaucratic obstacles, increase the problems faced by Iranian startups. To overcome these challenges, startups must adopt adaptive strategies and efficient project management methods. Prioritizing efficient resource allocation, effective risk management, and transparent communication are essential to reduce the impact of these challenges. Finally, this study provides valuable guidelines for entrepreneurs, investors, and policymakers to guide innovation and contribute to the country’s economic growth.