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Business in Latvia

Startups

Startups

A runway for doers

Start your venture in the world’s most startup-friendly country

The Latvian startup ecosystem is young, dynamic and rapidly evolving. In 2021 alone, it celebrated its first unicorn and attracted a record-breaking amount of foreign investment. In that same year, Latvia was recognized as the most startup-friendly country in the world by Index Ventures.

The number of startups in Latvia is growing every year, a trend accelerated by government support measures such as startup visas for foreign founders, tax incentives, and startup-friendly stock option policies. Currently, Latvia hosts over 700 startups, with nearly one-fourth founded by foreigners.

Latvia may be small, but in this case that’s one of our biggest assets. In our close-knit startup community, everyone knows everyone, thus any help founders may need to get their startups off the ground is more often than not just an introduction away.
Our international startup events are among the most value-adding in the world, offering the unique opportunity to engage with influential investors in an intimate setting. Big names and small crowds mean high chances of making meaningful connections.

Key ecosystem players

Latvian Startup Association

Non-profit non-government organization that aims to strengthen the local startup ecosystem, offers support to startups, and advocates for startup interests in policy-making processes. Launched in 2016, the organization currently has 100+ members.

TechHub Riga

As a startup-based community, TechHub Riga offers educational programs, organizes meetups, hackathons and other events to reinforce the existing tech ecosystem and help build the next generation of founders.

TechChill Foundation

A non-profit organization with an aim to help Latvian and Baltic startups succeed in the world. The team organizes 30+ activities to boost the local startup ecosystem, with the main event being TechChill Conference – the largest tech and startup event in Latvia and the Baltics.

LIAA

Investment and Development Agency of Latvia (LIAA) is a governmental organization that works to increase the export and competitiveness of Latvian companies, facilitate foreign investment, and implement innovation policies.

Connected in all the ways

Located between Central Europe and Scandinavia, Latvia is the ideal place for startups with international ambitions. From the Riga International Airport, the best-connected airport in the Baltics, all the biggest business hubs in Europe are within arm’s reach. Hop on a plane and in one hour you’re in Stockholm, in two – Berlin, in three – London or Dublin.

Hopping on a video call is just as easy – the internet connection in Latvia is one of the best in the world. 99% of the country is covered in a speedy and stable 4G connection, with 5G under rapid development as well. It’s planned that by 2025 the 5G network will, too, be available to 99% of the population of Latvia.

5th

fastest internet in Europe – and 16th fastest in the world

100+

direct flights from Riga to Europe's main business hubs

3rd

among OECD in mobile data usage

870 km

high-speed railway, RailBaltica, to connect Baltic state capitals by 2026

Latvia's got your back: state support for startups

  • Startup visa provides non-EU founders with a residence permit for up to 3 years to start an innovative and scalable business in Latvia.

    • 30 days from application to decision
    • Granted to up to 5 founders
    • Spouse and children-friendly
    • With the possibility of extension

  •  

    Latvia-based startups, including those launched by foreign founders, are eligible for a number of tax benefits, such as

    • 0% individual income tax
    • Low flat social tax

  • In Latvia, startup employees have the right to purchase company stocks for a certain set price – no taxes added. This makes it easier for startups to attract and retain talent.

    • The startup sets the price – no formal valuation required
    • 1 year minimum vesting period
    • Favorable taxes when reselling the shares

    Learn more in this document

  • Fast-track your startup’s success with 11 state-sponsored incubators around the country and a number of accelerators.

Innovation areas that Latvia is especially keen to support

ICT

Bioeconomy

Biomedicine

Smart energy

Smart materials & Photonics

Let’s talk Venture Capital

Discover who’s investing in Latvian startups

Over the past years, VC activity in the Baltics has grown immensely, bringing in funds from many regions, especially from the Nordics. Latvian startups demonstrate over and over again that with the right idea and dedication, you can attract global investor attention – along with the capital for your business.

International VC funds eyeing Latvian startups

  • Superhero Capital (Finland) – invests up to 1M EUR, focus on software-driven startups
  • Karma Ventures (Estonia) – invests up to 5M EUR, focus on deeptech
  • Practica Capital (Lithuania) – invests up to 2M EUR, cross-industrial focus
  • Fiedler Capital (Hungary) – invests up to 750K EUR, sector agnostic
  • Specialist VC (Estonia) – invests up to 3M EUR, focus on B2B, SaaS, fintech, platforms, software-enabled hardware, deeptech
  • Startup Wise Guys (Estonia) – invests up to 800K EUR, focus on B2B
  • FIRSTPICK (Lithuania) – invests up to 300K EUR, industry-agnostic

 

Local VC funds backing Latvian startups

  • Change Ventures – invests up to 2M EUR, cross-industrial focus
  • BADIdeas.Fund – invests up to 150K EUR, focus on B2B SaaS & marketplaces
  • Draugiem Capital – invests starting from 100K EUR, focus on e-commerce
  • FlyCap – offers mezzanine investments of up to 3M EUR, focus on healthcare, B2B, IT & Tech, export-oriented manufacturing
  • Imprimatur Capital – invests up to 2M EUR, focus on B2B software & data, digital health, learning & training, robotics/automation
  • ZGI Capital – invests up to 5M EUR, cross-industrial focus

 

According to the Latvian Startup Association, most investments in the period of 2013-2021 were attracted by business software (24%), advanced manufacturing (14%), and fintech (13%) startups.

Biggest deals to date

Printful: $130M

In 2021, the print-on-demand dropshipping and fulfillment company Printful raised $130M and became Latvia's first unicorn. Founded in Riga, Printful has offices, fulfillment centers, and partner facilities all over the world – from California to Melbourne. Lead investor: Bregal Sagemount

Lokalise: $50M

The all-in-one localization and translation management platform Lokalise raised $50M at the end of 2021. During the pandemic, the company gave up its office in Riga and went fully remote. Lokalise is regularly listed as one of Latvia's future unicorns. Lead investor: CRV

Printify: $50M

The printing and dropshipping service provider Printify announced raising $50M from a list of investors in 2021. According to TechCrunch, the company's post-money valuation after this round exceeded $300 million. Printify is often named one of Latvia's future unicorns. Lead investor: Index Ventures

Aerones: $39M

At the very end of 2022, Aerones – a startup developing robotized solutions for wind turbine inspection and maintenance – raised $39M. Founded in 2015 as a heavy-load drone company, Aerones pivoted to maintenance robots in 2019. Lead investor: undisclosed

Whimsical: $30M

The startup creating tools for workplace collaboration, Whimsical, announced a $30 million investment in 2021. Their solution, used by companies such as Stripe, P&G, Intercom, and others, combines whiteboards and docs in an all-in-one collaboration hub. Lead investor: Accel

Looking to meet your investor?

There are plenty of opportunities – here are a few:

Attend TechChill – the main startup event in the Baltics

Held in Riga in spring (usually end of April), TechChill gathers the region’s most active investors and most promising startups in one place. Besides, TechChill has that vibe many other startup events lack, making people want to come back every single year.

Ask for a personal introduction

In Latvia, once you’re in – you’re in. You’re one of ours now and the local founders who’ve had success attracting investment won’t be stingy with advice, introductions, and endorsements. Meet business friends at conferences, meetups, and other events.

Attend Deep Tech Atelier

The Baltics’ largest deep tech industry event brings together entrepreneurs, scientists and technology developers, investors, government, and public organizations. The two-day conference offers outstanding international speakers, pitch sessions, a large EXPO zone, and excellent networking opportunities at B2B sessions.

Read Investor Showcase on Labs of Latvia

Every month Labs of Latvia – the leading news source for all things tech, innovations, and startups in Latvia – interviews an investor looking to invest in Latvian startups to find out what exactly they’re after and how founders can grab their attention.

© Azeron
©Azeron publicity photo

AZERON

By focusing on including everyone and letting all gamers experience the thrill of competition, Azeron is changing the game – and changing lives too. With their commitment to inclusivity and innovation, Azeron is not only creating a more level playing field in the gaming world, but also inspiring others to think about how technology can be used to create a more inclusive future.

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StartSchool

Latvia is experiencing a significant development in the field of technology education. Leading Latvian tech companies have come together to establish StartSchool, a pioneering program designed to empower Latvia to the forefront of the digital age.
Central to StartSchool’s mission is the principle of inclusivity. Recognizing that financial constraints shouldn’t hinder potential tech leaders, the program offers a…

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Find out more…

If you’re looking to know more or have some additional questions regarding the start-up environment in Latvia, the support instruments or anything else, feel free to email your questions to the Startup Support Division of the Investment and Development Agency of Latvia via startup@liaa.gov.lv.

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