Estonia: the number of e-residents overtakes the population of Tartu

Since its rollout in 2014, the groundbreaking e-residency Estonia program has been on a mission to establish and nurture a multicultural and international community. It gives digital entrepreneurs and startups a platform to grow their business anywhere, while pulling in tax revenue and boosting the number of Estonian firms. It also offers some of the best e-services and a highly competitive tax system. 

The program has been growing in popularity over the years, and September 2022 saw it welcome its 94,892nd e-resident, meaning there are now more e-residents than the entire population of Tartu, the second largest city in Estonia. Predictions suggest that there should be over 100,000 e-residents by mid 2023, with around 1,000 applications being approved each month. 

If these predictions are accurate, it will mean that the number of e-residents will be close to 10% of the total number of Estonian residents, which stands at around 1.3 million. This makes e-residents a powerful constituency of the population, giving them a voice at policy level in Estonia. 

E-residents come from all over the world, with recent sanctions on Russia putting the number of Ukrainian e-residents at the top of the list. Entrepreneurs from European countries like Germany, Spain, Turkey, France, Italy and UK have taken advantage of the program, as well as those in China, India and the US. 

It isn’t breaking news that many experts believe Estonia has one of the best start-up ecosystems of its kind on the continent. For more than three decades, the country has been focused on creating an economy around research and technological innovation. It now has the most startups, unicorns and investments per capita in Europe. 

There are some big unicorn tech companies that began their life in Estonia – Skype, Playtech, Wise, Pipedrive and Bolt being just a few notable examples – and these companies don’t show any signs of slowing down. According to this source, Playtech, for example, continues to grow its reach, with 2022 seeing the company adding two prominent poker options to its growing iPoker Network.

Since being established, the e-residency program has supported the creation of over 23,000 new Estonian companies. Statistics also show that 30% of Estonian startups have e-residents among the founders, and 20% of Estonian companies registered in the last three years were created by e-residents. 

Its popularity and continuous growth is down to it bringing anyone who wants to operate a location-independent business, or quickly form a limited company that can be operated from anywhere, obvious and immediate benefits. For many entrepreneurs, setting up a business in the country they live in is a costly and drawn-out process, but the straightforward nature and well-developed infrastructure and marketplace of the e-residency service providers makes it easy for these startups to develop their business. 

The e-residency program may be popular, but it still needs to focus on evolving and working on its services. Investments in user experiences and new services are in the pipeline, with plans to make the program even more accessible and less time consuming for entrepreneurs who want to establish their business within the digital ecosystem.

While experts predict that 2023 will see the number of e-residents surpass 100,000, the program hopes to get more active users whose daily business is run through Estonia. Perhaps in the not-too-distant future, a unicorn startup might be solely started by an e-resident.