Analytics, Estonia, Good for Business, Innovations, Investments, Technology

The biggest turnovers were posted by companies active in the business software, services and human resources (HR) sector, which saw a turnover of  106.7 mln euros combined, followed by the advertising technology and creative technology sector with 65 mln euros and the fintech sector with 46.8 mln euros, Startup Estonia announced on Monday.

The biggest companies meanwhile are active in fintech. 

Of the biggest Estonian startups, Pipedrive posted a turnover of 47.8 mln euros, Adcash of 37.9 mln euros, Creative Mobile of 21.3 mln euros, Comodule of 18.3 mln euros and Fiizy of 18.2 mln euros for 2019. 

Maarika Truu, head of Startup Estonia, said that the startup sector statistics is becoming increasingly exciting, especially thanks to all of the new information we know now.

"Due to the obligation of employers to register their employees, we have a better understanding of what are the professions that people are employed in," Truu said. She said the fact that 45% of the people are in the professional major group shows that we have high-quality jobs and employees in different areas.

Statistics from the Estonian Tax and Customs Board shows that as at the end of the 2019, Estonian startups employed 5,944 people locally, 31  more than the year before.

Significant increases in employee numbers posted by startups during the year include an increase by 240 at Veriff, an increase by 233 at Bolt and an increase by 141 at Transferwise. 

According to Statistics Estonia, the average monthly gross salary in Estonian startups was 2,347 euros, 68% higher than the national average pay at the end of the third quarter 2019. Employees aged between 31-50 earn the highest average monthly gross wage, of 2,840 euros. The average monthly gross wage of foreign employees was 2,499 euros.

Where in 2017, startups' employment tax contribution to the economy totaled 36 mln euros, it grew 48% to 53 mln euros in 2018 and by a further 46% to 77 mln euros in 2019. The biggest contributing sectors are fintech with 22.6 mln euros, business software, services and HR with 17.8 mln euros, transportation and logistics with 9.8 mln euros, CyberTech with 5.5 mln euros and DeepTech and SpaceTech with 4.6 mln euros.

The largest contributors among startups last year were Transferwise with 11.1 mln euros, Pipedrive with 7.8 mln euros, Bolt with seven mln euros, Veriff with 2.8 mln euros, and Starship Technologies with 2.7 mln euros.

A closer look at the demographics of startup employees in Estonia shows that 36% of startup workers are women and 64% are men. The staff of Estonian startups is relatively young, with 52% of employees aged between 21-30 and 36% aged between 31-40. The rest of the age groups are represented with significantly fewer people, with up to 20-year-olds making up 2%, 41 to 50-year-olds 8% and people aged over 51, 3% of employees.

Approximately 22% of the employees of startups have foreign citizenship, including 6% who have EU citizenship and 16% who have non-EU citizenship. 68% have Estonian citizenship, whereas the citizenship of 10% of the employees could not be confirmed.

Over half of the employees of startups, 55%, have higher education, while 33% have secondary or secondary vocational education. The proportion of people with higher education among foreigners working in Estonian startups is 60%, higher than the sectoral average of 55%.

According to the crowdsourced database and Estonian Startup Database, 258.3 mln euros was invested into Estonian startups in 2019. Even though the total amount invested in 2019 was smaller than in 2018, when it was 330 mln euros, the number of investments made increased significantly. Besides, the figure for 2018 was influenced by a large-scale investment made in Bolt.

In total there were 71 new investment deals in 2019, almost double compared to 40 deals in 2018. Also, the value of investment 28 deals in 2019 totaled at least one mln euros or more, compared to 20 such investments in 2018.

The biggest investments raised by 2019 were 128 mln euros raised by Bolt, 36 mln euros raised by Starship Technologies, 18 mln euros raised by Glia, 11 mln euros raised by Realeyes, nine mln euros raised by Skyselect, 7.6 mln euros raised by  Coolbet, 5.5 mln euros raised by Xolo and 3.8 mln euros raised by Transferwise. 

Startup Estonia is a governmental initiative aimed to develop the local startup ecosystem. The program of Startup Estonia is carried out by KredEx.