Why Estonia Is Becoming the Go-to Hub for Global Entrepreneurs

Estonia is the world’s first truly digital nation. Its e-Residency program, which has been operating for 11 years, has revolutionized the online business world. 

Its borderless business concept encourages entrepreneurs to open an EU-based business in Estonia without physically needing to be there themselves.

This article explains how Estonia’s e-Residency works and whether it’s the right move for your business.

The Birth of Borderless Business 

In 2014, Estonia’s government launched the world’s first e-Residency program. While other countries have tried to copy it, Estonia’s still remains the most popular.

Estonia’s e-Residency Explained

An e-Residency is a digital identity for global entrepreneurs to start a 100% online company. There’s no need to be physically present in Estonia to establish your company, and registration can take as little as 2 to 4 hours. You’re provided with a digital ID card that enables legally binding digital signatures. Your business is run entirely online, from incorporation to banking to tax filing. The e-Residency provides full access to Estonia’s transparent and efficient e-governance system. In 2025, the cost to apply for e-Residency in Estonia is €150.

To be clear, you’re not a physical resident of Estonia, so you can’t take advantage of any travel rights allowed under the EU. This is purely an online residency for company creation and operation purposes. However, you do have access to the EU online business market.

From Experiment to Movement

Estonia’s e-Residency program was conceived in 2014 and won a competition run by the Estonian Development Fund. By 2020, over 50,000 e-Residents from more than 150 countries had joined the program.

What began as an experiment to entice global entrepreneurs to Estonia grew far beyond the original vision. As of 2025, there are over 120,000 e-Residents of Estonia and more than 30,000 companies founded there with a combined revenue of €15 billion. 

Why Entrepreneurs Choose Estonia

As more organizations move online, easier market access, faster processes, and fewer regulatory barriers make Estonia an attractive base for business operations.

Legitimacy and EU Market Access

The e-Residency is only the beginning. Operating a 100% online business in Estonia provides many benefits. Firstly, your business falls under the European Union’s regulatory framework. This provides instant credibility across EU countries. Estonia has a unique business tax arrangement where you only pay corporate taxes on distributed profits. This leaves more income to be used for reinvestment and business building. 

Another advantage of operating an online business in Estonia is that cross-border commercial activities can be conducted in all EU countries with fewer regulatory barriers and streamlined VAT handling.

Digital Efficiency vs. Bureaucratic Nightmares 

A fully digitalized company in Estonia means one primary thing—no paperwork. In many European countries, establishing a business takes around 30 days and requires significant amounts of documentation and in-person visits to government agencies. In Estonia, it’s all done online, no physical presence is required, and the entire process is finalized in a few hours. The legal digital ID provided under the e-Residency program enables trusted and legally binding online transactions.

Regular business activities like filing taxes can be actioned within minutes, not days, and can even be automated. 

A Freelancer’s Path to Founder

One of Estonia’s e-Residency success stories is PRNEWS, a company that took less than an hour to register. The company now has an official HQ in Estonia and by 2024 had employed 21 people with another 58 staff in six other countries. In that same year, his company’s turnover increased by 30% to €5.2 million. 

Global Success Stories

In the 11 years since the establishment of the Estonian e-Residency program, over 30,000 companies have been founded from across the globe in a variety of niche industries. 

Entrepreneurs Without Borders 

The Estonian e-Residency option enables businesses worldwide to have a European presence. With more than 170 countries being eligible to apply, success stories have emerged from:

- Kenya: Kontorva, a digital services company

- Brazil: Mobits, a mobile app development firm

- Singapore: Singularity Group, a tech services consultancy

The diversification of the types of companies is also noticeable, showing that the opportunities here are endless:

- Fintech: Jambo Pay

- iGaming: HIPTHER

- Augmented Reality (AR): Glassity

Investor-Friendly Reputation

Yet another bonus for establishing an e-Residency company is that it can benefit from Estonia’s position as a startup hub. This opens the door to EU-based venture capital, government grants, and startup accelerators. 

As just one example, Beamline Accelerator is a Tallinn-based company focusing on raising capital for clean-energy-based companies. Two that caught its eye, established under the e-Residency program, are Trashly from India and AgriEye from Ukraine. 

Estonia’s Growing Role in iGaming

The Estonian government is attempting to entice more iGaming companies away from Malta, the current iGaming hub of Europe. 

New iGaming Tax Reform

Estonia’s new iGaming tax reform was announced in early 2025. The primary incentive is the gradual reduction of the remote gambling tax rate. It’s currently 6% and will see a reduction of 0.5% a year until 2028, when it plateaus at 4%. Malta’s current gambling tax rate is 5%. This final 1% reduction will make Estonia attractive for existing and new businesses.

In an effort to continue its reputation as a trustworthy nation, the government will increase oversight by the Financial Intelligence Unit to ensure compliance with stricter licensing requirements. The plan is for licensing processes to be simplified and streamlined, and player protections improved, without imposing harsher restrictions on operators. Bonus offers, free spins, and other player incentives will still be allowed, but with complete transparency.

Why iGaming Firms Are Eyeing Estonia

In addition to the attractive tax incentives, iGaming firms are eyeing Estonia, as there are already many entrepreneurs looking for places to invest. Estonia has earned a reputation for reliability, compliance, and fair gaming and has avoided any scandals. Businesses in the region are early adopters of blockchain technology, which can benefit iGaming platforms.

Challenges and Criticisms

While all signs point to Estonia as being a logical place to found a business, there are some minor challenges to know before going ahead. As a place with attractive tax benefits, it gets lumped in with a less credible crowd. 

Not a Tax Haven, But a Trust Haven

Hear the names Cayman Islands, Jersey, Bermuda, and the British Virgin Islands, and one of the first things that comes to mind is the concept of shady offshore tax havens. Estonia is not one of these, nor does it share this reputation. With its transparent digital-forward tax system, operation within the European Union’s legal framework, and compliance with international tax regulations, Estonia is, in fact, a trust haven. 

Things to Consider Before Applying

It’s not easy to open a bank account in the country as a non-resident—e-Residency doesn’t count. There are also tax implications for the business’s home country, which may tax the business as a local entity under “permanent establishment” rules, which may result in paying double tax. 

The Future of Borderless Business

Estonia has set the standard for e-Residency programs, and Lithuania and Azerbaijan have already introduced their own versions. Georgia, Brazil, South Africa, and Antigua and Barbuda have announced intentions to also go down that road. 

The entrepreneurs of the future are freelancers creating new startups, and with the tax and other incentives, iGaming operators are expected to shape the next wave.

For now, Estonia leads the way in digital innovation, and it could be years, if not decades, before any other country steps up to match its offerings.