The President of Estonia calls for unicorn predictions

Sander Nõmmik
Author Sander Nõmmik

Estonia produced its fifth unicorn – Pipedrive – on November 12, 2020. Just an hour and a half after the announcement, the President of the Republic of Estonia, Kersti Kaljulaid, asked the billion dollar question on every investor’s mind: who will be Estonia’s next unicorn?


President Kaljulaid is a champion of the liberal market economy, a relentless global advocate of the digital economy and cyber security – and one of the best experts about Estonia’s startup scene.

According to Kaljulaid, the sixth Estonian unicorn is already hatching. However, she’s left it to the rest of us to figure out which startup it may be.

Unicorn predicted

So we asked leading investors and founders who already have plenty of experience building unicorns in Estonia for their take on who will be Estonia’s sixth unicorn. We’ll share those in the upcoming weeks.We can give you a few hints now though.

US venture capitalist Tim Draper expects to see transformations in banking, finance, insurance, legal, accounting, government, and healthcare in the upcoming year. Serial unicorn builder Taavet Hinrikus is the co-founder of TransferWise and former strategy director at Skype, as well as an investor in Pipedrive and Bolt. He’s keeping an eye on startups that can build a product 10 times better than their competition. Sten Tamkivi, ex-Skyper and CPO at Topia, suggests looking for companies solving huge global pain points and can name more than a few with that potential. Kaidi Ruusalepp, the founder and CEO of Funderbeam, named both a leading startup but also one many may not have heard of yet. Martin Villig, the co-founder of Bolt and the President of the Estonian Founders Society, highlights a sustainable business model as the ‘must have’ component of becoming the next unicorn.

Soon you’ll find out who they predict will be Estonia’s next unicorns. The only prediction we can say with certainty though is that another unicorn is coming – and possibly soon!

Estonia, the unicorn factory

Estonia is the leader in unicorns per capita. Despite a population of 1.3 million people, the country has been the birthplace of five unicorns so far: Skype in 2005, Playtech in 2007, TransferWise in 2015, Bolt in 2018, and Pipedrive in 2020. That’s 3.8 unicorns per capita. And the time lag between the creation of each following unicorn is constantly decreasing. If this trend continues, Estonia’s next startup company valued at $1 billion will be announced in 2021.

What makes Estonia the ultimate unicorn factory? There’s more than a few good reasons.

After restoring its independence in 1991, economic freedom has been highly valued in Estonia: today Estonia ranks fifth in Europe for economic freedom. The economic environment created by the state encourages people to start and grow businesses. Estonia has also been a steadfast global leader in tax competition for the last seven years in a row. But it’s not only Estonia’s famous tax system without corporate income taxes, capital taxes and property transfer taxes, that makes people entrepreneurial. There’s also Estonia’s advanced digitalisation which reduces hassle and costs, a high ease of doing business, a wide range of encouraging success stories, a developed and affordable living environment, a long and full-paid parental leave, and a welcoming and supportive startup community. For these reasons, Estonia is the leading startup-friendly country in the world. And you don’t even have to have your feet on the ground in Estonia to enjoy the benefits of this business environment. Estonia’s innovative e-Residency programme, itself referred to as a state startup, enables anyone to log into our country to establish and manage a company here, regardless of their physical location.

Estonians are a nation of innovative and productive people. Estonia’s entrepreneurial activity is the highest in the world. That has not been an end in itself for us. Curiosity has led us to this. Estonians have built more than 1,000 startups focused on solutions, not problems. According to The State of European Tech 2020 report by Atomico, there are 865 startups per capita in Estonia, and based on statistics of Estonian Startup Database, that number continues to grow.

But even if you have the best business environment and the most entrepreneurial people, it doesn’t guarantee automatic success. You also need a bit of good luck and support from a vibrant startup community. And the Estonian startup community loves to share its unicorn-building experience. Since the days of building Skype, we’ve been gathering knowledge that gets passed on from one generation to the next.

Unicorn matching tool for investors

In these challenging times globally, even old fashioned networking has to take place online for investors. So Invest Estonia in cooperation with Startup Estonia has developed a unique new unicorn matching tool that is based on data from the Estonian Startup Database, a unique database powered by Startup Estonia, which includes information on 1,000+ Estonian startups. After seeing how easy and effective it is, you may wonder why you ever spent so much time travelling to find investments in the past.

“We have built this automated tool to save time and hassle for investors so that they receive the inspirational information they need about promising startups within seconds. These matches are based on the suitability and preferences of both the investors and the startup,” Kaspar Kork, Director of Estonian Investment Agency says.

There is no literal factory, of course. The production line for Estonia’s next unicorns extends from coworking spaces and trendy offices to kitchen counters and basements in towns and villages across our country, and even deep into our wild nature where some of our best ideas are born and refined. The backdrop to our unicorn matchmaking tool is Estonia’s old technology shelter in the town of Järva-Jaani. That’s where Estonians can gather inspiration from the technology of yesterday – which has now been lit up with festive lights – when thinking about bright ideas for the future.

Invest Estonia combines the data with additional resources on the companies’ growth, finances, marketing effort, and consistency from other public sources and provides investors with inspiring startup matches.

For each visitor, the tool finds 3 companies that best match the investor’s profile and are worthy of consideration as a potential investment.

If you want to invest in a startup that could be the next unicorn, step inside Estonia’s unicorn factory and meet the founders hard at work here.