11 Mar How Estonia is unlocking the entrepreneurial potential of women?
Estonia is proud to be the first country to offer e-Residency, a government-issued digital identity and status that provides access to Estonia’s e-services and transparent business environment. Since the end of 2014, Estonian e-Residency provides digital entrepreneurs with the freedom to establish and manage an EU-based company paperlessly, from anywhere in the world.
Location-independent international business, bringing business to Estonia, using the technology of secure authentication, or just being a fan of e-Residency – these are just a few of many named motivations to apply for the e-Residency.
Application countries (source https://e-resident.gov.ee/dashboard/)
Let’s talk numbers. According to the latest statistics, over 5 years the Estonian government has issued almost 66,000 e-Residencies out of over 70,000 applications and counting. Most e-Residency applications were submitted by Finnish, Russian, Ukrainian, German, United Kingdom and Chinese citizens. And these are just the top active countries without including Japan, India, Brazil, Egypt, Australia, and many others (see picture above).
Over 10,000 Estonian companies were established by the e-Residency holders. However, only 12,6% of all the applicants were female. In order to understand why there is such a significant gap between female and male applicants for Estonian e-Residency, we needed to hear an opinion from one of them.
Lara Stancich, a successful entrepreneur and the owner of Rocket&Coco (trading as Rocket&Pip), agreed to share her experience into leading a business formed with e-Residency and answer our burning questions.
Idea and birth of the business
– Describe your business
Around 83000 women across Europe woke up this morning pregnant, and with nothing to wear. My business, Rocket&Coco, is a circular economy model to solve that problem and improve sustainability in the fashion industry.
It is an online subscription service to allow women across Europe to rent the best and most stylish maternity and post-pregnancy clothing, so they always have something fabulous to wear and feel confident about how they look, for a fraction of the retail price.
We then ensure the clothing continues to have a life, through re-use, re-creation and re-cycling. Our objective is to keep it out of the landfill.
– What encouraged you to start your business?
I observed how so many friends (as well as myself) were struggling to find stylish, good quality maternity clothing at a reasonable price, since the market is polarised between cheap throw-away clothing and beautiful but expensive maternity clothing. Since pregnancy is a temporary state, you don’t want to spend too much money on clothes you only use a short time.
I got great feedback on my idea from friends who were recently pregnant, so I did a little experiment with a landing page and google ad campaign to see if there was any wider interest – there was. I then pitched my idea to an entrepreneurship panel at my university (I am currently doing an MBA at Warwick Business School in UK), I received great feedback and advice, and some contacts to help me move forward.
The peculiarities of business in Estonia
– Why did you decide to start your business in Estonia?
There are lots of reasons!
I live with my family in Italy at the moment but we move every couple of years so I am often having to learn new languages and new bureaucracies. On top of that, I am a British Citizen and was concerned that with Brexit, I would no longer have the right to operate a business in the EU. I was also concerned by the complexity and cost of setting up a business in Italy.
I knew about Estonia’s innovative approach to being a digital nation and discovered the e-Residency scheme. For me, this was perfect, as the scheme ensures I can have my business in the EU, and the whole process, from applying for residency, through to tax rules, is very transparent and easy to understand.
– What are the advantages of doing business in Estonia?
The transparency and ease of doing business in Estonia, the fact I am welcome to have my business in Estonia even if I don’t live there, and of course, that it is an EU member state.
I do find the setup costs for Estonia higher than, say, a similar service in the UK. However it is not unreasonable and I found the service provided by Successhub to be excellent – efficient, personal, kept me informed every step, and I would never consider trying to set up a business by myself in a country where I don’t speak the language or understand the requirements! A service I previously used in the UK was purely transactional, whereas Successhub seems to approach the process as more of a genuine service interested in helping the business be successful, and I hope the relationship will continue to develop this way!
– What challenges did you face when running your business in Estonia?
So far, it’s too early to say!
Doing business from a woman’s perspective
– Why do you think only a bit over 12% of e-Resident applicants are women?
Since around 1/3 entrepreneurs in Europe are women, I think part of the reason could be a lack of awareness of the e-Residency opportunity and its credibility.
Information and support for women entrepreneurs in Europe is improving but is still quite poor, difficult to obtain, and let’s not get started on finance and investment facilities! I think there is a huge opportunity for Estonia to tap into this area by providing well-communicated information and support targeted at women entrepreneurs.
– Are there any challenges you face as a female entrepreneur? If yes, how do you overcome them?
In some ways, this is a great time to be a female entrepreneur, as the amount of support and attention is increasing, with active encouragement for female entrepreneurship.
Raising investment is a definite challenge, though, particularly as my business is not primarily about technology and it seems most investors are focused on tech innovations. There are fewer women entrepreneurs in tech, so that creates an immediate disconnect. I am still figuring out and exploring ways to raise the finance I need for the business to develop!
Also, one of the challenges of being a female entrepreneur that hardly anyone talks about is that as a woman, you are always juggling multiple jobs (kids, house, day job, volunteer work, study) and if you are an entrepreneur as well, then you are doing multiple roles in the business too and trying to keep costs down! How am I managing this? Drawing heavily on the support of my partner and friends (for example when I have to travel), occasionally a cleaner (and my tolerance of dust has gone up considerably), making lots of lists, trying to delegate what I can (which I find difficult, to be honest), and working hard. I run with a group of friends 2-3 times a week, and though I often think “I don’t have time for this!” I still do it because it makes me feel better and helps clear my head.
– What tips do you have for other women who would like to start their own businesses here?
When starting a business, being able to focus on your core business rather than complex bureaucracy is a huge advantage, and Estonia really supports this in two key ways: 1) the accessibility of information, and 2) the availability of reasonably-priced experts to deal with the bureaucracy. So I think this is a huge benefit.
More generally, the most fundamental tip is to make sure you have a viable business idea that is either solving a real problem or vastly improving how something is done (because it doesn’t matter how easy it is to start a business if your business idea is not viable).
And then I think that it’s really important to use your networks and build new networks – the power of connections is tremendous.
It is also helpful to have someone checking in on you, like a mentor or advisor, to see how things are going, what issues are you facing at the moment – sometimes just talking things through can make it more manageable.
A homage to the mentors and exemplars
– Who are your mentors? What did they teach you?
I am very lucky to have an amazing mentor, as well as two business advisors at the moment.
Sophia Nadur has been my mentor for about 8 months, she is an experienced entrepreneur who has moved back into the corporate world to help link mobility startups with BP’s move to be carbon neutral. She has taught me a lot about the clarity of communication and presentation, and the importance of asking for help. She has also been a great sounding board for my ideas and barriers.
I also have a wonderful business advisor in Katie Baron, who has masses of experience in fashion retail and trends. She is a powerhouse of ideas and enthusiasm, and every exchange with her gives me a huge energy boost.
– Is there any Estonian entrepreneur you look up to? Why?
There are several Estonian entrepreneurs I admire, such as Taavet Hinrikus of Transferwise, and Karoli Hindriks of Jobbatical. The reason is that their businesses are about making things easier for globally-minded people. As someone who moves around a lot, I have experienced first hand how so many systems (such as banking and jobs!) are very localised and needlessly difficult to navigate when you are a foreigner. I love that Estonia (and its entrepreneurs) have a real culture of open-ness and a global view.
Another thing I admire about Taavet Hinrikus is that he knows he enjoys the entrepreneurial journey more than “being the boss”. It’s important to be able to recognise that something you created might be bigger than just you, and also to recognise where your own strengths lie. Too many entrepreneurs get caught in conflating their business and their egos.
Topics requiring more attention
– What are the topics regarding women in business or e-Residency you wish would be discussed more?
On e-Residency, It would be really useful to know more about how to hire people in other European countries as an Estonian small business, particularly for dealing with social charges.
I know a lot of people who are considering e-Residency but are struggling to be clear on how they would pay themselves in their physical country of residency, or pay employees who are resident elsewhere. This is compounded by the fact that this practical information is difficult to track down locally (my own local chamber of commerce and accountant don’t yet have the answers!).
For Women in Business, -I would love to know more about support networks for women in business and business startups in Estonia, and funding opportunities directed at female entrepreneurs (if there are any!).
In conclusion, it is safe to say, that one of the reasons why there is such a significant gap between female and male applicants for Estonian e-Residency, is the lack of information and the support from the environment whether it‘s provided by the government or the fellow entrepreneurs.
Therefore, Successhub, together with Women in Business Association in Estonia is organising a “Growth Lab – Bridge Between Entrepreneurial Women”, where for the 1st time the best keynote guest speakers from Estonia, Italy, and Turkey are joining us in the Growth Lab to build bridges between young women entrepreneurs from Estonia and foreign founders through sharing the experience and learning from each other.
The speakers will encourage women not only to expand their business but also to look for new business opportunities. Best practices will be shared on how to turn storytelling and digital marketing into a tool for business growth. Young entrepreneurs will be guided on how to build new connections and find new customers.
During the training session “Growth Lab – Bridge between Entrepreneurial Women” we will discuss business development, storytelling, digital marketing, and networking.
The information about entrepreneurs who will share innovation-related experience and other event details can be found here.