In Estonia, the homegrown startups are sometimes accused of being “all style and no substance”. Startup entrepreneur Ragnar Sass analyses the Estonian startups, based on their paid taxes, and proves that contrary to the argument put forward by skeptics, #estonianmafia pays a very real money to the state coffers.
The article was first published by Ragnar Sass on Tumblr.
Back in October, when the Estonian Tax and Customs Board published data about how much the Estonian companies have paid taxes for the first time, I created the first ranking among the Estonian startups of my own. The list started with 20 startups, but thanks to the amazing community, it has quickly grown to 40. Having the latest tax information hand, I took a bit different approach – I looked at the overall sums, but also analysed how much these numbers have changed over time. Some findings are quite surprising.
This analysis presents the data about 52 startups. I might have missed some of the smaller ones, but in general, it should give a pretty good picture of how much the Estonian Mafia is actually accomplishing. Similarly to my first analysis, I only looked at the paid employment taxes. As the Estonian Tax and Customs Board published data about the last five months of 2014, I compared the monthly average numbers per quarter. If in Q3 startups paid the total of €1,000,975 per month, then in Q4 this number had grown by 9% to €1,101,634. So the overall trend is okay.
When looking at the data about the 10 biggest startups, one can already see some significant changes. If in October the biggest taxpayer was the mobile gaming company, Creative Mobile, then it has now clearly shifted to TransferWise. Considering the latest news about its funding, the company could reserve this place for the next few years or so. Seven startups out of top 10 are growing nicely – the biggest changes come from Guardtime and TransferWise, both increased by 30%. And yes – we are talking about the percentage per quarter. From the other side – the tax amount of Creative Mobile decreased by 21%, and Fits.me by 14 %.
Here is the overall ranking by the paid employment taxes: Q4 Q3 %
|32||Click & Grow||6,773||8,665||-22|
Among these, Zeroturnaround, Qminder and Taxify received funding in Q4 and Defendec in Q3, which makes the changes in the costs pretty understandable. It is pretty clear that Planet OS also received some extra finances to fuel their growth, even though there haven’t been any public announcements about it.But what is even more interesting is the overall change in Q4. Looking at the data, we can see the biggest gainer is Goworkabit, but its case is a little different as its business is based on renting short-time workforce. But still the numbers prove they had very good last quarter. Even though some of these startups are still very small, they are definitely on fire now. If your paid employment taxes are growing so fast, it’s most likely a good reason to hire more people.
Biggest growth (%) in Q 4
Cover: Startup Estonia.