Riga: The Startup Community Full Of Fresh Talent

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You want to found in the very heart of the Baltics? Get to know about diverse opportunities in Riga, Latvia's first destination for startups and business.

Riga is a city of layers. It proudly plays the role of the capital of Latvia, offering diverse opportunities for those who are after history, education, culture and business. One can never know everything about this city, yet its focus is on success and growth, which makes Riga a preferred destination for a large portion of the country’s population. The city is challenging, and it fits perfectly with startups.

On The Baltic Shore: Riga

Riga is the next big thing, this is what the local startuppers are searching for, and the startup community is always there to welcome you on board to disrupt the existing stagnating life, tech and business models. Still, there is a lot more in the bag when choosing Riga as your place of residence

Advantages Of Starting A Startup In Riga:

  • Location: you will find Riga in the very heart of the Baltics with a population of over 640,000. Over the past 2 decades it has become one of the most vibrant cities in Northern Europe with close transport links to the rest of Europe, no matter if you like buses, trains or airplanes. The winters may be pretty cold and the summers may not be that hot, but the city is full of energy whenever you are ready to conquer it.ur
  • High-speed internet: with the average speed of 13 Mbps, Latvia ranks #7 in the world in 2015, way ahead of the startup metropolis USA itself. Moreover, tons of WiFi points ensure that you can be connected to the web as often as possible (check for the free WiFi map here).
  • Low living costs: even though the city is rapidly growing, the living expenses are still attractive and affordable, compared to other startup grands, such as San Francisco or London. You can rent a spot in a co-working space in the very Old Town for as little as 100€/month, while the average apartment rent is 6,5€/m2.  Plus, just for the record – startup catalyst beer is also cheap (and tasty)!
  • Founding a startup: it takes only 35€-120€ to register a company in Latvia if you’re an EU citizen. The fee depends on the amount of starting capital and the number of shareholders. What’s even better – your starting capital can even be 1€! A pro tip: when you are applying for the Latvian social security number (you’re going to need it), apply for the e-signature option as well! It will save you A LOT of legal costs (7-40€ for each important signature) and time (equals money).
  • The city: yes, let’s go back to this! The vibrant cultural life makes sure you are never bored. Theatres, outdoor attractions, the beach, nightlife, architecture and ice-hockey create the face of the city and show how to spend your free time in an engaging way!

What You Need To Be Aware Of:

  • Size of the market: Latvia is small, just below 2 mil people. It can work as a good test market if you’re after one, but be warned that you need to think global since day one in terms of business. Riga will probably not be your sole pool of money.
  • Bureaucracy: While you can found a company easily, be careful in managing it. Lots of papers are to be continuously issued to the State Financial Inspection and Enterprise Register so be prepared for a time-consuming communication whenever you are not on the same page. In addition, when you are doing business with larger corporations, the level of bureaucracy that both sides of the story have to go through is really high, and can take lots of time and energy just to do everything according to the system. Latvia is a Civil Law system country, meaning that EVERYTHING that you are supposed or not supposed to be doing is written in law, and most of the times you have to consult a lawyer in order to be sure that what you want to do is legal.
  • Costs: In Riga, the nominal prices are much lower relative to large metropolises in the developed countries. HERE are nice stats on how much things cost. Long story short, if 20€ will not get you far in a supermarket in London, it will give you plenty in Riga, and you can even rent a 2 bedroom apartment in the city centre for as relatively low as 450€/month. Same goes for offices. The workforce here is relatively cheap as well, and while a 2000€/month bruto salary may be enough only to hire an employee straight out of University of London with little work experience, it will get you the best specialists around. But be patient when recruiting, good specialists do not grow on trees.
  • Tax & State Revenue Service: In order to sustainably operate in Riga, you have to pay taxes. The corporate income tax rate in Latvia is 15%, ranking in the lowest bottom 25 percentile in EU, which is good news. State Revenue Service, the institution that monitors taxes being paid in the country, has gone from a penalty-minded organization in the 90s to a consultancy-minded one in the 2010s, and if they find that your company is doing something wrong, they won’t punish you at first, but consult you to find a way to make things right. A pro tip: when State Revenue Service agents report to you that you’ve been doing something wrong, listen to them peacefully and don’t argue. They are never wrong in finding tiny mistakes that your company has done. Listening to them will land you lower penalty fees and sometimes even a free-of-charge tax consultant.
  • Public vs. Private sector: One of the core ingredients of building a company is solving problems quickly. In Riga, the larger a corporation is, the slower you will be able to solve the problems. While the good part of the story is that in an SME in Riga you can reach out to the very CEO directly almost in the middle of the night and he will respond to you, as the size of the company grows, it can take you a month to even start solving a problem. The situation is even worse when working with the public sector, because they are not working effectively most of the time. A pro tip: when arranging a meeting with someone that’s not a CEO, ask him if he is the one that makes a decision. If not, then you might lose your time talking to the wrong person.
  • Mentality: Riga has become a Westernized city with good infrastructure and world-known brands. Still, there is a mentality gap between the older generation that lived in the Soviet period and younger generation that is up for everything that demands the entrepreneurial spirit – you will meet diverse people! In addition, don’t be surprised if some Latvians don’t open up that fast or don’t talk to you at first, they are kind of an observing nation that becomes truly friendly when they see they can trust you.

Get Into Riga’s Startup Community

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In 2012 the startup community in Riga started to develop faster than ever before. TechHub Riga, the largest tech startup co-working space in Latvia, was founded, and that kickstarted the interest in startups in Riga. Many people eventually left their day jobs and started to work on their own projects. The great increase of interest in tech business and startups resulted in a dynamic environment of events. Among the most popular lists are Startup Digest Latvia edition, Meetup.com and Labs of Latvia events that also features news and great insights of Latvian startup and community profiles.

Regular Events, Meetups & Conferences:

  • TechHub Riga Monthly Meetup – the top event that gathers the local startup community in one place! Every meetup offers a keynote or two, presented by experienced tech entrepreneurs, community announcement section and pitching opportunity. Of course, plenty of networking is in the air, and the beer is on the house! Attendance is free of charge and open to everyone who’s interested in tech, innovations and startups.
  • LatCraft Events – community-driven meetups where you can find the most awesome Latvian software craftsmen, listen to keynotes, develop your skills and build new connections.
  • Business Incubator of University of Latvia Events – Business Incubator of UL attempts to educate young entrepreneurs through interactive talks with experienced entrepreneurs and useful seminars. While currently most of the events are in Latvian, keep an eye out for useful events in English.
  • TechChill Baltics – the most content driven tech and startup conference in the region taking place each February and chilling the best in tech!
  • UX Riga – a practical one-day conference on usability and user experience letting you learn new skills from industry experts from all over Europe. It takes place each spring.
  • Riga Dev Day – a one-day software development conference with topics related to Java, Android, Web, Wearable and Embedded programming.

Pick A Place At Co-working Space In Riga

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As the traditional business models are changing, the ways how people work are also stepping into new directions. Co-working style seems to be the fastest growing in Riga, and every potential startup and freelancer can find a space he or she feels the most comfortable with.

The price policies vary from space to space, and you can rent one in a range of 6€/day to 150€/month.  Among the largest co-working spaces are:

  • TechHub Riga – the largest and oldest co-working space for tech and IT startups and freelancers that’s located in the heart of Old Town. It is a home for 30+ startups and a host for various technology related events.  You can choose from 3 membership types – resident (100€/month), resident LITE (75€/month) and flex (400€/ year) – and also enjoy the benefit package of mentoring program and discounts to startup events.
  • The Mill  – a co-working space that brings developers and designers together, located in the city centre close to all cultural spots.  The space itself is a meeting point for lectures, exhibitions and formal/ informal events. Love ping-pong? It’s your place to be! Their memberships: resident (150€/ month) and drop-in (100€/month).
  • Make Riga – a co-working space and hackerspace for hardware ideas and businesses. You will find everything you need at the space to make your product great, including a 3D printer, jigsaw and grinder. Membership fees: standard 20€/month, hacker 45€/month and resident 75€/month.
  • Darba Vieta – a nice and cozy co-working space that unifies creative industries and tech people. They share their vision of collaboration and productive way of working, and they implement that in their space. Membership fee: 90€/month.
  • Birojnīca – a space for work, education and meetings, located in the city centre. They offer four subscription plans, including a day plan (6€) and monthly plan (60€).

Keep Your Budget Secured In Riga

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Every business is dependent on funding, and it is crucial to calculate your capital right. As the Riga business scene continues developing, more and more financial resources are given out – the private angel, incubator and investment fund capital are up for grabs.

However, the concept of raising external money for tech companies in Riga (or Latvia in general) is relatively new, and though the investors want to be involved with startups more and more, the possible Latvian mentality makes them triple check the investment candidates. Be ready for precaution and bureaucracy! Thus, make sure your pitch is perfect enough, the sparkle in the eye shiny enough, the team behind you motivated enough and the growth plan detailed enough. If you’re the next big thing – prove it!

Incubators, Accelerators & Government Grants/ Loans:

  • Altum – focuses on helping local companies receive financial support from the government in the form of grants and loans. You can get support to start your business, to develop it or to enter foreign markets – investment and the necessary co-investment vary in each grant/loan, but be wary, the communication is very slow.
  • Eegloo Business Accelerator – focuses on helping aspiring Baltic entrepreneurs start and grow their IT business. They invest expertise, network and cash to create companies with global potential.
  • Creative Andrejsala – focuses on companies in the creative industries, e.g., music, cinema, fashion and photography. Currently the support is open till October, 2015, and you need to check on the grant availability.
  • Green Technology Incubator – focuses on supporting and encouraging businesses involved in greentech. It supports development of products, services, and processes that harness renewable materials, energy sources and efficiency, reduce the use of natural resources, and cut or eliminate emissions and wastes.  Pre-incubation (services in amount of <10 000€) and incubation grants (<140 000€) are available to selected companies. The incubator was founded by University of Latvia, Riga Technical University and Industrial Development Corporation of Norway.

Venture Capital Funds:

  • ZGI Capital – founded in 2005, they have already invested in 10+ projects in different industries. With more than 15 investors on the list, they have funding available up to 1,5 mil €.
  • BaltCap – founded in 1995, they are the leading dedicated private equity and venture capital investor in the Baltic states.
  • FlyCap – the fund invests money, time, knowledge, contact base and experience, and they expect strong teams with a clear product vision to apply for funding. They are also startup-friendly as 20-30% of the fund will be invested in those startups that have a proven business model.
  • Expansion Capital Fund – they invest from 100,000€ to 1,5mil € in SME’s and also offer mezzanine loans if bank support is not available.
  • Imprimatur Capital – a venture capital firm focusing on high-tech at an early stage in its commercial development. They invest in start-up technology businesses that are based on innovative intellectual property, are led by strong teams and have high international growth potential. The potential support is up to 600,000€ per startup.

One of the recent additions to financial support is the Latvian Business Angel Network, bringing together highly experienced entrepreneurs who are willing to invest their money in new and promising ventures. Each month you can apply to pitching sessions, impress the angel panel and meet your future investor.

Use All Possible Help And Advice In Riga

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Eventually, if you decide to have a startup in Latvia, you just need to come and build one. There will be struggles, ups and downs, but no one is free of them. Yet, you have the support, so use it!

  • Attend the events where you can meet like-minded people, network, talk about your business, find partners and clients and build a base for your success – TechHub Riga and The Mill host plenty of them.
  • Research – the previously mentioned Labs of Latvia platform provides and continuously updates the Latvian startup scene with startups, communities, events and funding options. It’s never been easier to find information on the local startup environment!

In the end, think outside the box – Riga may just be your perfect destination!

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Last updated: July 29th, 2016

The guides are like startup communities – they contstantly change and grow. Make sure to check for updates and if you have something to add to one of them or want to publish one for your city, get in touch right away! And don’t forget to enrich the startup ecosystem by creating your company profile at StartUs!

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