Estonian Startup Sector Turnover Grew Last Year
The turnover of Estonia’s startup sector grew by 15% last year to €3.9 billion, while startups paid a total of €750 million in taxes. The turnover of startups up to five years old increased by 20%, reaching €444 million.
According to Startup Estonia, approximately 1,600 startup companies were operating in Estonia at the end of 2024. Startup Estonia’s Managing Director, Vaido Mikheim, noted that despite ongoing turbulence in global markets, the Estonian startup sector remained stable.
“Last year was not easy for founders, but the startup sector continues to show steady growth and remains an important contributor to the state’s tax revenue. On a positive note, Estonia’s next generation of startups, meaning companies up to five years old, demonstrated solid growth in both turnover and investment volumes,” said Mikheim.
Once again, Bolt was the highest-revenue startup in Estonia, reaching a record turnover of €1.4 billion. It was followed by Pipedrive (€282 million), rapidly growing identity verification company Veriff (€102 million), Yolo (€79.6 million), and BetPawa (€68.1 million).
Estonian startups paid €382 million in state taxes and €367 million in labor taxes during 2024, representing approximately 4% growth compared to the previous year. The largest contributors in labor taxes were Bolt (€41.8 million), Wise (€38 million), Playtech (€18.1 million), Yolo (€15.6 million), and Pipedrive (€14.5 million).
However, the volume of startup investments declined last year.
In 2024, Estonian startups raised a total of €326.6 million, which was 23% less than the year before. A total of 57 investment transactions took place during the year, 17 fewer than in 2023. The average deal size remained unchanged at €5.7 million, but only 29 funding rounds exceeded €1 million compared to 41 in 2023.
“Although this is the lowest annual result in terms of investment volume over the past five years, I would avoid making long-term forecasts at this stage. Local venture capital funds are better capitalized than ever before, with approximately €1 billion available for investment. Let’s see how the coming quarters develop,” said Mikheim.
During the fourth quarter of 2024, only nine investment deals were completed, compared to 25 during the same period a year earlier.
The largest funding round of the year was secured by Starship Technologies, which raised €90 million. Other major investment rounds included Stargate Hydrogen (€42 million), Elcogen (€30 million), Tuum (€25 million), and Pactum (€18 million).
In the fourth quarter, the largest investments were raised by Modash (€11 million), Miros (€6 million), and Qminder (€3 million).
Mikheim highlighted that approximately 44% of all investments raised during the year went to startups up to five years old, amounting to €143 million. These companies completed 40 funding rounds, representing more than half of all investment transactions during the year.
“We often focus on Estonia’s startup superstars, but younger startups are also delivering impressive results. This gives us reason to be optimistic that larger funding rounds from a new generation of founders will emerge this year,” said Mikheim.
Among startups up to five years old, the largest investments were raised by Stargate Hydrogen (€42 million), Tuum (€25 million), Pactum (€18.4 million), and BotGuard (€12 million). The top five also included Äio, founded just two years ago, which raised €6.1 million to develop environmentally friendly oils and fats from wood and agricultural by-products.
In total, 11 startup exits took place in 2024, including three during the fourth quarter. In October, British fintech company Pockit acquired Monese. In December, Finnish IT company Admicom acquired Estonian construction software company Bauhub. Salto X also merged with Australian company Cake Equity and subsequently discontinued its own service.
The best startups of the year were announced on Friday evening at the Estonian Startup Awards gala. Awards were presented in five main categories: Newcomer of the Year, Investor of the Year, Founder of the Year, Fastest Revenue Growth, and Contribution of the Year.
Estonian Startup Award
The special award categories of the Estonian Startup Awards recognize startups that focus on solving significant global challenges in the fields of DeepTech, GreenTech, and DefenseTech. Additional awards are presented to outstanding companies in fintech as well as hardware and software services.
The Estonian Startup Awards are organized by LIFT99, the Estonian Founders Society, and Startup Estonia.
Read more about the winners in the published .
Startup Estonia is a government-backed program dedicated to developing Estonia’s startup ecosystem, supporting the creation of new startups and helping them become international success stories. The program is implemented by the Estonian Business and Innovation Agency and is financed through European Union funding.
