Home to over 850 companies, Lithuania’s startup ecosystem is a diverse and supportive platform for bringing innovative solutions to life. With September 7 – the date of the region’s leading startup event Startup Fair – fast approaching, here are the ten things you should know about Lithuania’s startup scene.
1. A growing regional leader
The Lithuanian startup sector proved its resilience last year, coping well with the challenges brought on by Russia’s war on Ukraine, energy crisis, and fears of a global recession. 2022 saw the total sales revenue of Lithuanian startups increase by 4% to €2.6B. The country’s startup ecosystem is now the leader in Central and Eastern Europe in terms of growth of enterprise value. According to Dealroom.co, the value of Lithuanian startups grew more than 16-fold over the past 5 years, and is currently at €9.5B.
2. Money flows
Despite the global slowdown in venture capital activity, Lithuanian startups raised €295M in 2022, the sector’s second best year on record. Lithuania now ranks 3rd in the CEE for VC investment per capita. There has been significant development in the local VC scene, with several Lithuania-based VC funds, including Practica Capital, FIRSTPICK, and Batic Sandbox Ventures, announcing successful fundraisers late last year. Nevertheless, Lithuania’s startup ecosystem has firmly captured the attention of international investors – in 2022, 36% of the VC funding in Lithuanian startups came from the rest of Europe and 35% from the US.
3. Third unicorn born
Earlier this year, Dealroom.co named Baltic Classifieds Group the third Lithuania-born unicorn. The company joined two previous Lithuanian unicorns – second-hand online marketplace Vinted and cybersecurity company NordVPN. Listed on the London Stock Exchange at a value of $1.026 billion, Baltic Classifieds Group is the largest ad portal group in the Baltics, managing 14 leading portals in Lithuania, Latvia and Estonia.
4. No layoff wave in sight
While tech giants like Meta and Twitter laid off thousands of employees last year, the Lithuanian startup sector has been weathering the storm – tech companies here have stayed some of the most reliable employers in the country. Over the last 6 months, the number of specialists employed by Lithuanian startups remained stable at around 17,300, while compared to 2022, the number of employees has even increased by 1,800, or 12%.
5. Business software is the top sector
A recent study of the Lithuanian startup ecosystem showed that over a fourth of local startups operate in the area of business software. Fintechs are the second largest group – 14% of Lithuanian startups are developing financial technology products and services. HeathTech, Advanced Manufacturing and AdTech round out the top five.
5. Staunch supporters of Ukraine
Since the first days of Russia’s invasion, Lithuania’s startup community has been supporting Ukraine in its fight against the aggressor. To date, millions of euros have been donated by the ecosystem’s most prominent players – for instance, Tesonet, a business accelerator that produced the unicorn Nord Security, donated €1M to a crowdfunding campaign to purchase air defense radars. Another local unicorn Vinted donated €2M and raised €1M from its users. Countless other startups have donated financial and humanitarian aid as well as organized volunteers to help Ukrainian refugees arriving in Lithuania.
6. United for success
Vilnius is undoubtedly the country’s startup hotspot, and last year the city’s tech ecosystem was united under the Vilnius TechFusion umbrella. It is not only a new brand for high-tech businesses in Vilnius, but also a community that aims to foster collaboration, problem-solving and the exchange of know-how. Founded by Lithuania’s most successful startups – including Vinted, Bored Panda, Hostinger and KiloHealth, among others – association Unicorns Lithuania is another startup community that counts 100+ technology companies among its members. With a strategic goal of a three times bigger startup ecosystem in Lithuania within the next few years, the association is focusing on community building and communicating the value of startups to the broader public as well as key decision-makers.
7. An open platform for non-EU startups
Nearly a hundred foreign startups have relocated to Lithuania in the last 5 years through the Startup Visa – a programme that provides non-EU entrepreneurs a streamlined entry process to the country’s startup ecosystem. The changes made to the programme last year have extended the visa period from one year to two, giving entrepreneurs more time to spend on developing their business rather than sorting out migration procedures. And for those just looking for a taste of Lithuania’s startup scene, there’s Startupcation – a new week-long programme for non-EU startups to experience the local ecosystem first-hand through meeting founders, discovering key business hubs, and learning about available governmental support.
9. Universities in the startup game
In recent years, Lithuania’s top universities have focused on creating hubs where students, researchers and businesses mingle. For instance, Vilnius University Tech Hub has already put eight cohorts of aspiring entrepreneurs through its pre-accelerator program and has recently opened a new co-working space. Meanwhile, Vilnius Tech operates “LinkMenų fabrikas” – a collaborative makerspace, media hub and startup incubator with tools and experts for learning, making and sharing.
10. Largest tech campus in the making
Vilnius is poised to have one of the largest tech campuses in Europe by 2024. Tech Zity, a real estate developer focusing on infrastructure for tech startups, has announced a €100 million infrastructure project that will house 5,000 digital ecosystem workers in one sprawling campus in Vilnius’ New Town district. According to the developers, the project will be 30% larger than any tech campus developed in Europe so far. Tech Zity announcement comes hot on the heels of the opening of Cyber City, an innovative tech campus courtesy of Tesonet, one of the country’s most prominent startup accelerators and the mother ship of NordVPN, Lithuania’s second unicorn.