It is a question that is making the rounds of economic circles as well as the technology world how has Estonia managed to become a leader in technology and innovation?
The answer is in the past, believes Estonian-born CEO and co-founder of TransferWise, Taavet Hinrikus.
“We (Estonia) kind of started rebuilding the nation in 1991 after we became independent again. And we did things the smart way.”
Estonia has reinvented itself by modernizing and digitising many of its old analogue systems since gaining its independence from the Soviet Union of which it was a part earlier.
It’s e-identity program, and the e-residency initiative highlights Estonia’s digitalization attempts and progress.
With all done at the click of a few buttons – Estonia’s e-residency initiative offers foreigners the chance to become a digital resident of the country while its e-identity programme has streamlined financial services and day-to-day tasks for the 98% of Estonians who have an ID card.
Estonia’s ability to reinvent is behind Estonia’s digital growth, said Hinrikus during a television interview.
“We did things from the beginning in the right way, setting up the right kind of structure in the economy. I think partially that’s thanks to the entrepreneurial tech success story, but also the government has some very smart people.”
“We’ve done many things digitally, we have the electronic government, and we have the EU residency programme, so all of these things are now starting to prove that it means there’s much less bureaucracy, things are running much more smoothly, it’s cheaper to administer and it’s more pleasant for consumers; the residents of Estonia.”
In addition to its rebirth as a haven for tech start-ups and entrepreneurs, a pivotal chapter in not just Estonia’s digitalization was the success story of Skype, which was founded in the northern European country, Hinrikus also believes.
how the video chat service’s entrepreneurial success story inspired working Estonians was seen first-hand by Hinrikus who was also the first-ever employee at Skype.
“The fact that Skype was founded in Estonia, the fact that Skype had a successful exit, which meant that Estonia benefited in a major way, meant that entrepreneurship became legitimate,” said Hinrikus.
“There were more than a thousand people who either worked or had worked at Skype who had seen what it takes to build a global business.”
“These people then had some money which they either put aside as a result of having the well-paid job in later years at Skype, or maybe they made some money when Skype was sold,” added Hinrikus.
Hinrikus sees Estonia as a “test bed” for the rest of the world in terms of replicating Estonia’s success in other countries.
“The benefit that Estonia has is that we’re (Estonia) a tiny country. If you have 1.3 million people it’s easier to change things when compared to if you have a billion people. So I think in that sense we should be a really good test bed for the world.”
“We’re (Estonia) creating new ways for people to live their life which is very exciting.”
(Adapted from CNBC)