Estonian E-Residency Facilitates Startup Success for Global Entrepreneurs - Startup Terminal

Wednesday, July 22, 2020

Estonian E-Residency Facilitates Startup Success for Global Entrepreneurs


Estonian E-Residency Facilitates Startup Success for Global Entrepreneurs

By Hannah Brown 

Entrepreneurs searching for a suitable setup for their global startups need look no further than the digital nation of Estonia. The ‘Silicon Valley of the Baltics’ may be a small country of 1.3 million people in North-Eastern Europe, but it certainly packs a punch when it comes to fostering startups through its advanced digital infrastructure, IT capabilities, and innovation mindset.

Well-known startup unicorns Skype, Transferwise, Bolt, and Playtech have roots in Estonia, where digital transformation has remained a key national strategy for nearly three decades. After Estonia regained independence in 1991 when the Soviet Union collapsed, it needed to adapt fast to ensure its economic survival and the future prosperity of its citizens. The government identified technology as its number one priority and set out to digitally transform the country from scratch.

Now in Estonia (or e-Estonia as it has become known), 99% of public services are available online via its transparent and secure e-governance system. Digital transformation has reaped economic and political benefits for the country, and raised its profile around the world as a ‘digital pathfinder’ and a ‘pioneer’ in e-governance.

E-Residency was launched in 2014 as the first program of its kind in the world. It allows people outside its borders to access Estonia’s online e-services and business environment using their individually verified digital identities and secure authentication technology. Location-independent entrepreneurs operating in diverse sectors can use e-Residency to quickly establish a company online, digitally sign and encrypt documents to the highest EU standards, and grow their business by easily integrating all the tools needed — from business banking to payment processing solutions, and from virtual office to accounting solutions. E-Residency does not give any right of travel, residence or citizenship to Estonia or the EU.


Now, over 70,000 e-residents from all over the world are using Estonian digital services and have set up over 13,000 companies. Two e-residents who have successfully applied e-Residency to their business structures are Sri Lankan Alagan Mahalingam, founder of technology consulting firm Rootcode Labs OÜ and Nevena Sofranic, founder of Recrooit and Omnes Group OÜ, providing online recruitment solutions.

Alagan became an e-resident in 2019 in order to help scale and globalise Rootcode Labs into the EU. Sri Lanka has a vibrant tech community of energetic startups and entrepreneurs but being registered in the EU makes it easier for Rootcode Labs to work with EU-based companies. Alagan was impressed from the outset:

When I found e-Residency I couldn’t believe it was possible. From the time of signing up, I was impressed with how the ecosystem worked, how easy the e-services worked, and how easy it was to start a company.”

Alagan is also the creator of Expert Republic, an award winning app for 1:1 video calls with experts from a multitude of industries. He built this app (formerly called Serw) with his Rootcode Labs team in less than 48 hours at the Global Hack: Fighting the COVID-19 Crisis hackathon in April 2020 and ended up winning the work track. Expert Republic was recently featured on Product Hunt and is growing in popularity and use every day. Alagan has an ambitious vision for Expert Republic, as a modern platform where business can happen digitally and without borders for decades to come. Read more about Alagan’s entrepreneurial journey here.

A long-time digital nomad, Nevena runs Recrooit through her Estonian company while on the road, dividing her time mostly between Belgrade, Serbia and Los Angeles, USA. When she found out about e-Residency a few years ago, she immediately saw that it would be a perfect solution for her business plans so she applied and received her digital ID card in 2019:

“The flexibility it allows, the simplicity of the entire process, and most importantly, the level of security and the fact that it’s completely in line with European laws made it a no-brainer.”

While launching a startup during a pandemic might be intimidating to some, Nevena is optimistic. In May 2020, Recrooit was accepted to Amazon’s AWS Activate Founders’ Program, and is considered the most promising Estonian startup in the program. Since soft launching on Product Hunt a few weeks ago, job positions on the platform and the Recrooiter community are starting to grow. Read more about Nevena and Recrooit here.

These are just two great stories in our community but there are many others running successful businesses thanks to e-Residency. In the last six years, it has proved to be a suitable business structure for entrepreneurs around the world, particularly those working as remote freelancers or digital nomads, running location-independent or service-based enterprises, or founding online startups.

Estonia has already transformed the way a country serves people beyond its borders through programmes such as e-Residency. Now with its brand new Digital Nomad Visa, Estonia is transforming how people in the world choose to work. The visa will allow remote workers to stay in Estonia for up to a year and have peace of mind that they can legally work. For the latest on the Digital Nomad Visa, visit our website and subscribe to our newsletter.

We look forward to seeing you in Estonia or e-Estonia very soon.

(Hannah Brown is the Head of Content at e-Residency, an initiative of the Republic of Estonia. Views expressed in the article are of the author)