Index Venture, an international venture capital company, evaluated the business policies of different world countries and found that Estonia’s economic environment is the best in terms of start-up friendliness. The risk of failure of starting companies is the lowest here and Estonia is seen as a very attractive place of business due to its reasonable business policy.
“Estonia has often been highlighted as a country with an open
economy with innovation considered as the norm. We lack huge
riches and extensive mineral resources, so we have to be smart
to survive, and this also manifests itself in intense business
activity and the search for new niches in the global market.
For Estonia, this predominantly means engagement in new
technologies,” explained Rene Tammist, Minister of
Entrepreneurship and Information Technology.
“Estonia is a country that welcomes foreign talents. We also
have a unique and successful e-Residency programme, which
became four years of age this Friday. An important advantage of
Estonia is the positive involvement of the private sector in
the state’s policy-making and legislation. Start-ups have
functioning cooperation forms with the state, and the companies
themselves interact with each other closely. It raises
awareness and also provides a decent base for supporting
business activities both in the initiation phase and later on.
Business environment must be transparent, provide the necessary
space for innovation, strengthen investment security and
increase added value,” said Tammist.
Small and medium-sized high-tech start-ups have a potentially
high economic impact. According to an OECD analyses, high-tech
start-ups will create 25–50% of the new high-paying jobs once
they reach the growth phase. The example of Estonian start-ups
indicates that start-ups create five times more jobs with two
times higher salaries (labour taxes per employee) than
traditional companies of the same age.
At the same time, however, Estonian start-ups are facing
problems that are similar across the world. In the start phase,
very few of them are able to succeed and reach the growth phase
due to limited capital. “The higher failure percent of
high-tech start-ups is offset by higher added value of
breakthrough companies,” Minister Tammist added.
Although we may face similar problems as other European
countries, we as a state have been able to move forward with
new ideas and give innovation an economic environment where new
solutions – such as sharing economy – can be successful side by
side with traditional solutions. “We already have good
cooperation in the technology sector, so we should use this
advantage to initiate new and ambitious projects. Now is the
time to gear up and find the next great ideas where Estonia can
be a pioneer similarly to the e-Residency programme,” the
“Europe is only beginning to develop its artificial
intelligence, quantum computing and electric transport
technologies, while China is determined to become the world’s
leading power in these extremely influential technology sectors
already by 2025. The ambition of Estonian and European business
policy needs to be directed towards shaping the future – this
has also been emphasised by the 30 most successful European
start-up companies,” Minister Tammist said.
The news item with the letter to the European Commission from
the best start-up companies of European countries for improving
the start-up friendliness of business policies is available
Source: Ministry of Economic Affairs and