This paper analyzes the catch-up process in nanotechnology firms in Iran and shows how an academic research team can grow and become an exporter of nanotechnology industrial equipment. To this end, an in-depth case study was done on a manufacturer of electrospinning systems for producing nanofibers. The quantitative data were analyzed and theorized using the technique of grounded theory. The study was designed based on the theoretical framework of technological catch-up with a sectoral innovation systems approach.The study explains how the key components of the system, including different sources of knowledge and technology, the structure of the market and customers, the government supports and foreign sanctions affected the catch-up process of the case firm. This study shows that the starting point and the stages of catch-up process by the firms in sanctioned countries may significantly differ from those for the companies in other developing countries.