Estonians establish twice as many enterprises as their Baltic neighbours.

The results of SEB's survey "Baltic Business Outlook" showed that Estonians are significantly more eager to launch and establish new enterprises. Ainar Leppänen, SEB Head of Retail Banking, sees the business environment, the economic system of startups and emigration as the main reasons for this.

If 21,947 enterprises were founded in Estonia in 2017, then in Lithuania the number was 11,378 and in Latvia 10,094. The aggregate of Estonia is almost twice as big as that of their southern neighbours in the Baltic states. The enterprises of Estonian e-residents also play a major role since there have been over 5,000 new ones over the past couple of years.

An even more telling result can be found if we divide the number of enterprises by the number of working-age population in those countries, which means that in the past years 0.02 enterprises per capita were created in Estonia, 0.007 in Latvia and 0.005 in Lithuania. These indicators suggest that Estonians are 3–4 times more entrepreneurial.

According to the estimation of Ainar Leppänen, there could be a number of reasons behind such differences. "These numbers definitely confirm the attractiveness of the business environment and the simplicity of launching an enterprise in Estonia.  The numerous success stories should also not be underestimated, from which our people gain motivation and inspiration; one recent example of this is the mega deal of Taxify," said Leppänen. The enterprising Estonians and the capabilities of the ecosystem can also be proven by our experience at the SEB Innovation Centre, in which just after a year-long operation period, approximately 1,500 entrepreneurs have gone through the centre within the framework of different programmes and hackathons," Leppänen added.

In addition to an attractive economic environment and a well-developed ecosystem of startups, demographic processes can also be considered as a reason for the different entrepreneurial levels of the Baltic states. "While emigration in Estonia has decreased and many people who left have found their way back to the homeland, in Latvia and Lithuania, emigration is unfortunately still a current problem and especially amongst young educated people. It is these in particular who have the courage and ambition to take risks and establish new enterprises," said Leppänen.

The SEB survey of new enterprises in the Baltic states was conducted in December 2017 and January 2018. More than 1,500 enterprises were surveyed in Estonia, Latvia and Lithuania.

Evelin Allas
Communications Manager
SEB

Phone +372 665 5649
Mobile +372 511 1718
Address Tornimäe 2, 15010 Tallinn
E-mail evelin.allas@seb.ee