Manager at Startup Lithuania
Guest editors are local ecosystem leaders: successful founders, investors, or thought leaders. Have someone in mind? Nominate a country guest editor.
Disclaimer: all content within the Startup Ecosystem Summary and Editor’s Guide sections is written by and reflects the personal perspective of the guest editor. The guest editor is not responsible for content within the Country Snapshot and Community sections, as much of this content is compiled from external sources and does not necessarily reflect the guest editor’s view.
Even though Lithuania is a small market, its startup ecosystem is booming: the number of startups is growing, and new players are entering the market. The beginning of the start-up ecosystem dates back to 2011. The following year, actions were taken to educate the society, and to organize events and other activities that encourage the establishment of startups in Lithuania. Enterprise Lithuania took the lead in this area. Today, “Startup Lithuania“ is a department of this organization with a mission to facilitate Lithuania’s startup ecosystem. The hard work put in over the past several years has paid off: at the end of 2012, there were 122 start-ups in Lithuania, and today, there are more than 900.
On the venture investment front, 2018 marked a record year for the Lithuanian ecosystem: Lithuanian startups attracted a record amount of investment. Additionally, Lithuania Business Angel Network and a few co-investment funds started to operate and made their first syndicated investments. In 2019, two new acceleration funds (Startup Wise Guys and 70Ventures) and 3 growth funds were launched with governmental support and incentives. An increasing number of investors from new markets also started showing interest in Lithuania, our start-ups and their founders. For instance, in 2019 investors from 11 countries participated in the main Lithuania startup event, “Startup Fair. Change 2019.”
The government and Ministry of Economy and Innovations pays significant attention to startups. In 2019 alone, an official legal definition for “startups” was approved, and favorable conditions for option taxation were approved (meaning employees who have retained the shares of the company acquired through options for more than three years will not be subject to personal income tax). Finally, this year significant changes were made for the Startup Visa Lithuania programme: temporary residence permits for foreign startups were extended to three years. This extension allows foreign startups to be more focused on business development, and since the beginning of the programme in 2017, 35 foreign startups from non-EU countries have already registered their business in Lithuania.
Lithuanian startups are keeping pace with global trends – local startups are actively developing deep technology businesses across artificial intelligence, machine learning, and blockchain. Lithuanian startups are also increasingly developing their products in areas as Fintech, Mobility, Life Sciences, and Cybersecurity. This is one of the strongest features of the ecosystem that we collectively hope to maintain in the future.
Lithuania is particularly investing in the development of its Fintech sector, and there’s a strong interest in this area from foreign countries–the Bank of Lithuania is recognized as one of the most progressive regulators in Europe. In addition, in Lithuania, a Fintech license for business development can be obtained faster than in other European countries. According to FDI Fintech’s locations of the future ranking, Lithuania is ranked 7th in the world in terms of favorable conditions for creating and developing startups. Startup Lithuania considers this area in the ecosystem as one of the most promising in the future.
Regarding the challenges, Lithuania is still waiting for its first homegrown unicorn and we strongly believe that our ecosystem stars will surprise us soon. We also notice a challenge in terms of commercialization – we have a lot of talent and ideas, but the lack of skills to commercialize and monetize these ideas is an issue.
Editor’s choice of the industries with the most potential for technology disruption and growth.
Editor’s choice of the country’s top 10 emerging tech startups.
Editor’s pick of which ‘Featured Startup’ is especially worth following and why.
Editor’s perspective of the maturity level of talent in the ecosystem.
Editor’s commentary on how the country’s culture and history have impacted the ecosystem.
Lithuania has pretty recently regained its independence. The fact that the country managed to modernize in such a short time and become visible in the world of innovation shows the level of technical talent in Lithuania.
Lithuania, as a country, strives for efficiency and transparency in business and government. Locals can often be heard talking about initiatives intended for making the system more transparent, and in 2019, a GovTech initiative intended to encourage innovators to create startups for the public sector was introduced.
Corporations have been more and more actively stepping into the startup ecosystem for some time now. They not only invest in innovation hubs or similar initiatives, but also develop internal startup “sandboxes” to encourage innovation and startup growth.
Guest editors are local ecosystem leaders: successful founders, investors, or thought leaders. Have someone in mind?
70 Ventures (Vilnius): Helps to build revenue and provides funding for B2B startups from Pre-Seed to Series A based on revenue milestones. (Source: Startup Lithuania)
Agata VC (Vilnius): An EU-based global early-stage VC company focused on Blockchain, Industry 4.0 and Health. (Source: Agata VC)
Business Angels Fund II (Vilnius): Risk capital fund for investments into innovative and export-oriented companies in Lithuania. (Source: Startup Lithuania)
Co-investment Fund (Vilnius): Makes co-investments together with a group of angels like a silent investor. (Source: Startup Lithuania)
Contrarian Ventures (Vilnius): Invests in early-stage tech companies with a focus on energy, transportation, IoT. (Source: Startup Lithuania)
EIT InnoEnergy (Vilnius): Accelerating and investing in sustainable energy innovations from mobility to construction. (Source: Startup Lithuania)
Iron Wolf Capital (Vilnius): Investing in early-stage startups with innovative ideas and global aspiration. (Source: Startup Lithuania)
Lithuanian Business Angels Network (Vilnius): Provides an opportunity to get investment from angels or their syndicate locally and across Nordics. (Source: Startup Lithuania)
Nextury Ventures (Vilnius): Founder-oriented venture capital fund works during all stages from idea to growth. (Source: Startup Lithuania)
Open Circle Capital (Vilnius): Invests in early-stage startups after first the revenues in the company. (Source: Startup Lithuania)
Practica Capital (Vilnius): Invests in seed, early and select growth-stage ventures as a cross-industrial investor focused on backing great teams behind the tech-driven businesses from the region. (Source: Startup Lithuania)
SEB Venture Capital (Vilnius): SEB Venture Capital invests in innovative fintech companies. Investments typically range from SEK10-30 million initially to SEK80-100 million in total over a holding period, giving SEB a solid minority holding in the company with an ownership stake of 15-40 percent. (Source: Startup Lithuania)
KTU Startup Space (Kaunas): Incubating early-stage startup teams by offering team coordination, consultations, mentorship, office space, training & events, and assistance in search of partners. (Source: Startup Lithuania)
Vilnius University Biotechnology Business Incubator (Vilnius): Life Sciences-oriented business incubator offering access to laboratories and modern equipment as well as a selection of services provided by Sunrise Valley Science and Technology Park: consultation on legal, intellectual property management, business development issues, raising of investment and/or funding, accountancy, marketing, validation/testing of products and services as well as consultations on commercialization, etc. The incubation period in the Biotechnology business incubator is up to 5 years. (Source: Vilnius University Biotechnology Business Incubator)
Accelerator One (Vilnius): Platform for entrepreneurs and corporates to help early-stage companies with piloting locally and scaling globally. (Source: Startup Lithuania)
Katalista Ventures (Vilnius): A hybrid startup accelerator and private equity fund focusing on Triple Top Line ventures that have a positive social, environmental and financial impact. (Source: Startup Lithuania)
Startup Division (Vilnius): Helps startups to develop their businesses, scale and attract funding. (Source: Startup Lithuania)
Startup Wise Guys (Vilnius): Accelerates B2B startups and helps tech startup founders become true entrepreneurs. (Source: Startup Lithuania)
Blockchain Center Vilnius (Vilnius): A global hub for blockchain-related services with an additional focus on community building and education. (Source: Vilnius Tech Park)
Kaunas Science and Technology Park (Kaunas): Leads start-ups and already growing tech companies to develop innovation and increase transnational competitiveness. (Source: Startup Lithuania)
SEB Innovation Centre (Vilnius): Innovation Centre with co-working space for fintechs and other innovative start-ups that seek cooperation with the bank. (Source: Vilnius Tech Park)
Sunrise Valley Science and Technology Park (Vilnius): Initiates business and science collaboration by providing R&D infrastructure and support for enterprises with aim to commercialize their knowledge. (Source: Startup Lithuania)
Vilnius Tech Park (Vilnius): Serves as the biggest ICT startup hub in the Baltics and Nordics, uniting international startups, tech companies, VCs, accelerators, incubators and other ecosystem players with a mutual goal – to shape the region’s startup ecosystem and grow together internationally. (Source: Go Vilnius)
Enterprise Lithuania: An agency under the Ministry of Economy and Innovation established to promote entrepreneurship, support business development and foster export. The team at Enterprise Lithuania is a reliable adviser and assistant for the start, growth, and export of national businesses with a focus on SMEs. (Source: Startup Lithuania)
Go Vilnius: The official development agency of the City of Vilnius. (Source: Startup Lithuania)
Invega: A financial entity incorporated by the State. The main objectives of the operations of the entity are as follows: provision of financial services and implementation and administration of financial and other support measures for SMEs. (Source: Startup Lithuania)
Invest Lithuania: The official agency for Foreign Direct Investment and Business Development. (Source: Startup Lithuania)
Lithuanian Business Support Agency (LVPA): Implements national strategies and programs for the development of the Lithuanian economy and its international competitiveness, helps to invest purposefully in support of business, research and experimental development (R&D), energy and innovation, tourism, administrates the European Union. (Source: Startup Lithuania)
MITA: Agency for Science, Innovation and Technology, supports R&D startups with grants. (Source: Startup Lithuania)
Startup Lithuania: A national startup ecosystem facilitator, whose main goal is to have more startups in the country and help them grow. Therefore “Startup Lithuania” organizes various events, hackathons, provides individual consultations for startup founders, manages the “Startup Visa Lithuania” program and organizes main startups event in Lithuania – Startup Fair. (Source: Startup Lithuania)
Work in Lithuania: An initiative of the foreign direct investment promotion agency Invest Lithuania that is aimed at encouraging professionals living abroad to build their careers in Lithuania. As part of this mission, it also works to strengthen the value offer of the country and initiate changes that will allow Lithuania to successfully compete for global talents. (Source: Startup Lithuania)
Kaunas University of Technology (KTU) (Kaunas): With almost 10,000 students enrolled every year, KTU is the leading university for technology studies in the Baltic states. KTU is also among the most business-friendly universities in Lithuania, actively cooperating with many global business services centers in Kaunas, including Festo, R1 (formerly Intermedix), Dematic and others. Its most common forms of business collaboration include organizing seminars and lectures, providing scholarships and accepting interns, as well as establishing new study programs, labs and thesis partnerships. (Source: Startup Lithuania)
Vilnius Gediminas Technical University (VGTU) (Vilnius): A leading technical university in Lithuania, with approximately 10,000 students and well-established partnerships with Danske Bank, Cognizant, DXC Technologies and many others. VGTU’s competencies are focused on the fields of construction engineering, ICT, fintech, cybersecurity, smart city, urban mobility and engineering. (Source: Startup Lithuania)
Vilnius University (Vilnius): The largest and oldest scientific institution in the Baltic region. VU has over 17,000 students and today a large variety of businesses have partnerships with the university: SEB, Nasdaq and Cognizant are all actively engaged with VU in organizing lectures at the university, Danske Bank, Citco and Nasdaq use the university’s student pool when recruiting future employees, while Devbridge provides internships, training courses and topics for theses. Vilnius University also offers a special entrepreneurship program. (Source: Startup Lithuania)