Innovation and entrepreneurship are buzzwords that fit any policy discussion on economic development. In this sense, innovation is not only a category of analysis employed by (social) scientists to circumscribe a defined set of economic practices for analytical purposes. Innovation is simultaneously a category of practice employed by practitioners and academics with their own, sometimes concealed, political agendas. Providing a situated sketch for a socio-spatially more attuned definition of innovation as a category of analysis, the article primarily asks what kind of innovation practices are imagined and / or enacted by both academic and policy circles. Thus, the article aims at scrutinizing the politics involved in thinking, doing, and relating innovation in the context of Armenia’s and Georgia’s quest for viable economic trajectories. We assess the legal and organizational framework in both countries and funding patterns of Georgia’s Innovation and Technology Agency (GITA) and Armenia’s Enterprise Incubator Foundation (EIF). Locational analysis of grant holders suggests company concentration within metropolitan areas of Tbilisi and Yerevan. Analysis of selection criteria of funding program allows for the assertion that a developmentalist project is advanced. Rather than reifying the actors’ language of innovation, we wish to highlight that current imaginations and practices of innovation are analytically better understood through the concept of “internationalized developmentalist agglomeration project”.