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An Estonian startup was created from scratch in world record breaking 15 minutes at London Tech Week

The Republic of Estonia beat its own record for the time taken to set up a business virtually, demonstrating the ease by which entrepreneurs can benefit from the country’s pioneering e-Residency programme. The new world record is 15 minutes and 33 seconds.

Austrian entrepreneur Dominik Panosch, an e-resident of Estonia, today started up a new Estonian business from scratch, at a live event hosted by e-Residency Estonia in partnership with Invest Estonia, Startup Estonia and Work in Estonia at London Tech Week. He beat Estonia’s previous record of 18 minutes and 3 seconds.

The event was attended by Estonian government representatives, including Estonian Ambassador to the UK, Viljar Lubi, as well as Lauri Haav, Managing Director of e-Residency. Martin Villig, co-founder of the super-app Bolt and Taavet Hinrikus co-founder of global FinTech company Wise (formerly TransferWise), and a new startup Certific, also attended.

Estonia as Europe’s Digital Growth Gateway

Since it launched in 2014, Estonia’s e-Residency programme has attracted over 93,000 e-residents from 179 countries, resulting in over 21,000 new Estonian companies with more than 10 bn euros in cumulative turnover to date. This new record further cements the country’s reputation as a Digital Growth Gateway for entrepreneurs, startups and scale-ups. This is also that’s supported by the country’s Startup Visa and Scaleup Visa.

With a growing workforce of “digital nomads”, freelancers and entrepreneurs, e-Residency provides a base to set up a company, manage it remotely and access a wide range of Estonian public and private e-Services. For example, e-residents can manage taxes, customs and business registration entirely online.

Easy access to global markets

According to Digital Ease of Doing Business Report comparing the country to five competitor markets around the world, Estonia has 7 ‘winning’ characteristics that mean it is well-placed to attract e-Residents looking to access global markets. They are:

  1. Speed: Estonia is currently the only country included in the study that grants the establishment of a new business within 2 days. At only 7 working days, it is also quicker to file corporate taxes in Estonia than any other country analysed.
  2. Access for foreigners: Estonia offers the easiest form of access for foreigners to establish a company: a digital ID. It also does not require a local agent to represent a business opened by a non-citizen. In other countries some form of visa is required for non-EEA or non-citizens.
  3. Fully digitised government services: Unlike in many other countries, every Estonian has a digital identity, making it possible to use the state’s digital services from anywhere around the world. This benefit extends to e-residents, who are also provided with a digital identity card, allowing them access to Estonian public e-services. Estonia’s digital infrastructure is blockchain-based since 2008 and combined with secure national digital ID, it results with unparalleled data security.
  4. International languages: Estonia is the only country included in the study that provides more than one international language to establish a company (English, Estonian and Russian).
  5. Support services for foreigners: Estonia excels in providing a large and growing marketplace of support services for foreigners to start up a business. For example, non-nationals of U.K. and Singapore and non-EEA residents in Ireland and Portugal cannot even start accessing services without a visa.
  6. Businesses per 100,000 people: Estonia is the country with the highest number of companies registered per capita in 2018 and the trend is growing. That’s 3 times more than Portugal or Ireland, and twice as many as Singapore.
  7. Transfer of shares: Estonia and Delaware are the only states included in the study that do not tax the transfer of shares. In the other countries the tax rate is between 0,2% and 2%. Estonia also has the world’s best tax system, with no corporate income tax on reinvested profits, no capital gains tax.

Europe’s unicorn factory

Estonia is currently the leader in unicorn businesses per capita in Europe, with 10 unicorns in a population of 1.3 million. In addition, the country has been ranked sixth among the world’s emerging startup ecosystems in the recently published Global Startup Ecosystem Report 2021, the world’s most comprehensive and widely-read research on startups. The report, covering 275 startup ecosystems from around the world, has highlighted Estonia’s market reach as its strongest feature. Analysis by Startup Estonia shows that E-Residents have created almost a third of the startups in Estonia.

According to Dominik Paschold, an e-resident, the EU is the world’s largest single market and offers countless opportunities for business. “Now, thanks to Estonia’s pioneering e-Residency programme, expanding a business to the EU online is quicker, safer and more convenient than ever before,” he added. “In an uncertain world, e-Residency is a no-brainer for entrepreneurs looking to startup or scale up quickly.”

A digital growth gateway

Andres Sutt, IT and Foreign Investments Minister of Estonia called Estonia a sanctuary for entrepreneurs across the world seeking security, resilience and a Digital Growth Gateway to all the benefits Europe can offer. “In this difficult time in Europe, we remain open for business and call for more entrepreneurs to join our community,” Sutt said.

Viljar Lubi, Estonian Ambassador to the UK, added: “Starting up a business in under 15 minutes demonstrates how Estonia is a nation at the forefront of the digital economy and a safe and secure place from which to operate and grow a business.”

A pro-business environment

Estonia’s success can be attributed to the country’s pro-business environment. According to the 2021 International Tax Competitiveness Index, Estonia has the world’s best tax system with no corporate income tax, no capital tax and no property transfer taxes Estonia’s tax system was ranked first amongst the countries of the Organisation for Economic Co-operation and Development (OECD) for the eighth year in a row. Whilst e-Residency does not equal tax residency, the nature of system helps shape business perceptions of and confidence in the country.

In addition, Estonia adopted a Digital ID system 20 years ago, making Estonia the 1st digitally transformed society and government in the world. Over 90% of public services are available online for any digital ID holder, including e-resident businesses. Estonia uses blockchain technology to enforce the integrity of its government data and systems.

Lauri Haav, Managing Director, e-Residency, said that e-Residency is an Estonian success story and a model for global growth. “We are demonstrating this in London, one of the world’s leading tech hubs, showing how quick, safe and hassle-free it is for entrepreneurs from all over the world to open their company in the EU and manage business from anywhere, entirely online,” he explained. “It is our ambition for Estonia to become the Digital Growth Gateway for entrepreneurs around the world, and Europe’s Unicorn hub.”

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