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Lithuania’s Startups: Surging Ahead with a €372 Million Tax Boost

Lithuania’s Startups: Surging Ahead with a €372 Million Tax Boost

In 2023, active startups in Lithuania bolstered the country’s budget by €372 million, marking a substantial 23% rise, equating to €70 million more compared to the previous year. The startup sector currently employs 17,600 professionals, boasting an average salary of €3,800 before taxes, as per data from Unicorns Lithuania.

According to the latest Dealroom review, the value of Lithuania’s startup ecosystem has skyrocketed relative to other European regions, experiencing more than a seven-fold surge to EUR 13.7 billion between 2018 and 2023. In terms of venture capital investment, Lithuania holds the second position in Central and Eastern Europe, attracting a total of €292.3 million in 2023.

Inga Langaitė, CEO of Unicorns Lithuania, reflected on the challenging economic climate of 2023, noting unprecedented milestones achieved by Lithuanian startups. Perhaps the most remarkable aspect of Lithuania’s startup story is the resilience and tenacity of its entrepreneurs. Despite economic uncertainty and geopolitical challenges, startups in Lithuania continue to defy the odds, with two companies raising an unprecedented €100 million each in 2023. “This isn’t just success; it’s a testament to the indomitable spirit of Lithuania’s startup community. A successful start-up today must not only prove that it can grow, but also that it can be profitable – that’s how good teams work,” Inga Langaitė, CEO of Unicorns Lithuania, comments on the situation.

The top 5 tax-paying startups in Lithuania for 2023 are as follows:

1. Wargaming – €27.42 million

2. Vinted – €23.55 million

3. Nord Security – €21.33 million

4. Baltic Classifieds Group – €15.40 million

5. KiloHealth – €13.89 million

But let’s not forget the unsung heroes—the seven startups, including Oxylabs, Gurtam, Flo Health, Bored Panda, Hostinger, Surfshark, and Planas Chuliganas, each contributing over €4 million annually to the country’s coffers. These companies may not always grab the headlines, but their impact on Lithuania’s economy is undeniable.

Quarterly contributions by Lithuanian startups in 2023 were as follows: EUR 97.1 million in Q4, EUR 92.6 million in Q3, EUR 97.4 million in Q2, and EUR 85.1 million in Q1. In 2022, the total contribution by startups amounted to €302.6 million.

The top 5 highest-salaried startups in Lithuania for 2023 include:

1. Game Insight – €9.58 thousand (2% increase from 2022)

2. Fullreach – €9.12 thousand (136% increase from 2022)

3. Oberlo – €9.06 thousand (32% increase from 2022)

4. Tesonet Accelerator – €7.86 thousand (3% increase from 2022)

5. Paysolut – €7.64 thousand (31% increase from 2022)

In Q4 2023, the average salary in the startup sector rose to €4.1k, an 8% increase from Q3. Although there was a slight decrease in the number of employees from Q3 to Q4 (17,800 to 17,600), there has been an overall increase in talent, with 17.4 thousand professionals working in startups at the end of 2022.

Langaitė highlighted the global nature of the labour market in the startup sector, with some foreign talent not reflected in the statistics. She also emphasized the role of artificial intelligence and process optimization in driving efficiency in the sector.

With over a thousand startups worth more than EUR 13 billion, Lithuania’s startup ecosystem remains a powerhouse of innovation and problem-solving, making it one of the fastest-growing and the second largest in Central and Eastern Europe, as per Dealroom’s analysis.