In recent years, Estonia has been a buzzword for startup success, with companies like Bolt, Skype and TransferWise having a global impact. However, with second-hand clothing marketplace Vinted raising a €128m in Series E funding late last year — and in the process becoming Lithuania’s first tech unicorn — it is clearly time to look more closely at Estonia’s Baltic neighbour.
Last year saw more than €170.6m invested in Lithuanian startups. While this was lower than the €183m raised in 2018, it highlights the money being pumped into the local ecosystem. According to a Dealroom report from last November, since 2013 Lithuania has topped the list of Baltic nations when it comes to venture capital investment, with an average annual growth rate of 135% between 2013 and 2018 (compared with 88% for Estonia and just 8% for Latvia).
In fact, in terms of overall invested venture capital, the country was fourth in central and eastern Europe during those years, behind only Estonia, Poland and Romania (though far behind those top three).
Those involved in the country’s startup ecosystem believe that Vinted’s success will help to put the country further on the map.
“Vinted becoming a unicorn, we believe that will give more opportunities for growth for the whole ecosystem,” says Roberta Rudokienė, head of Startup Lithuania, which is part of Enterprise Lithuania, a non-profit agency that operates under the Ministry of Economy.
According to Rudokienė, last year they counted more than 940 startups operating in Lithuania. “The number is higher than in Estonia, they count 650,” she adds.
Others see growing interest in the country from outside investors. “Many investors who had been talking for years about coming over at the right time came for a day or two last year, to meet with Series B and C level companies, and I think this is going to start happening with more earlier stages,” says Rokas Peciulaitis, managing partner at Contrarian Ventures, a Vilnius-based venture capital and private equity firm.
He adds: “We’ll probably see more companies doing bigger rounds. I know quite a few companies that will do rounds next year.”
In December, Go Vilnius, the business development agency of the Lithuanian capital, opened a Start-up Museum, showcasing the success stories of 12 local start-ups. Those highlighted included Vinted, as well as companies like nanosatellite manufacturer Nanoavionics, mobility platform Trafi, cybersecurity company Tesonet and car-sharing startup CityBee.
Here is Sifted’s pick of some Lithuanian startups to watch in 2020:
After raising €128m in Series E funding last November, on a valuation of over $1bn, Vinted is going to be on many people’s radar. The platform, where individuals buy and sell second-hand clothes, plans to use the money raised to continue its expansion in Europe, while also building additional features on its site to improve the user experience. At the time of its latest funding round the company had 25m registered users, across 11 markets and 300 employees.
A bit of a stealth company, since it hasn’t sought any outside money to date, cyber-security services provider Tesonet is touted by many in the ecosystem as Lithuania’s next big thing. The company has been growing fast in recent years, with clients in more than 80 countries around the world.
“To be honest, I think they are another unicorn that has never raised capital, but from the amount that they’re making in revenue they’re already there. They’ve completely bootstrapped the company and now they’re almost a thousand people,” says Contrarian Ventures’ Peciulaitis.
CityBee was the big Lithuanian success story of 2018, raising €110m in December 2018, against a valuation of €300m. The vehicle sharing company, founded in 2013, is one of the leading car, bike and electronic scooter sharing service in central and eastern Europe, and expanded its fleet into nearby Estonia and Latvia in 2019.
“Since Day 1 we’ve been built with an idea that shared mobility is the business of today,” Lukas Yla, CityBee’s CEO, tells Sifted, adding that they only started their expansion into foreign markets at the end of 2018. “Poland was the first foreign expansion market. We launched CityBee cargo van sharing service in 11 cities in Poland, with a fleet of 250 cargo vans.”
Yla adds: “Since the launch of the service, CityBee has been growing double every year: size of fleet, number of users and rides. 2019 finished with a user base of 610,000 registered users and three million rides, in all markets.”
In 2020 they’re aiming to roll out car sharing in Poland, with 1,500 cars, followed by a fleet of electric kick scooters.
Since its founding in 2007, Trafi has grown to become a major supplier of mobility software for companies like Google, Lyft, Apple, Volkswagen and Skoda, as well as cities like Jakarta, Rio de Janeiro and Prague.
Among other things, Trafi’s technology allows the mapping in real-time of buses, traffic and construction, enabling smarter decisions when travelling. In perhaps its most ambitious project yet, in June 2019 Trafi developed an app for BVG (Berliner Verkehrsbetriebe), Berlin’s main public transport company, the first mobility app to connect all different types of transport in the city.
“2019 was amazing year of growth where we won several key clients like Berlin BVG, Gojek, and emerged as a category leader in MaaS [Mobility-as-a-Service] technology providers,” Martynas Gudonavicius, Trafi’s chief executive and cofounder, tells Sifted. “In 2020 we’re planning to become a clear market leader and provide best in class MaaS solutions to dozens of cities and corporate clients.” The company has raised €12.6m to date, the latest round in May 2017.
Launched in 2018 by Gabija Grušaitė and Justas Janauskas, one of Vinted’s co-founders, Qoorio has created a marketplace for knowledge and experience.
“Most successful individuals, what they do really well is they find solutions to problems and deliver,” Janauskas tells Sifted. “The biggest impact of achieving that is usually having a very wide personal network, who can step in for knowledge they don’t have.”
Qoorio aims to replicate this, linking those with specific knowledge and skillsets with those in need. They have more than 1,800 professionals from diverse industries and specialties like law, economics, politics, engineering, media, chief executives and chief financial officers. After launching in Lithuania Janauskas says that their focus is now on expanding across Europe. In 2019 the company raised more than €2.5m in seed funding over two rounds, with the second round lead by Mangrove Capital.
Founded in 2017, Oxipit is a computer vision software startup specialising in medical imaging that harnesses artificial intelligence diagnostic capabilities in areas like radiology.
Backed by a strong team, Oxipit’s ChestEye artificial intelligence-based radiology software suite helps radiologists improve productivity, reduces error-rates and addresses the issue of shortages of radiology specialists in developed markets. The software generates preliminary reports immediately after X-rays are taken, and arranges patient scans by urgency. It can also issue medical reports in 12 languages and counting, including English, German, French, Spanish and Turkish.
The company raised $1.7m in seed funding in June 2019, the largest investment in medical artificial intelligence solutions in the Baltic states to date.
Gosu.ai caught our attention late last year when it raised €2.5m in an early venture capital round, led by Brighteye Ventures, a leading European edtech venture capital fund. This brought the total raised by the two-year old startup, which provides personalised artificial intelligence assistance to gamers, to €4.6m.
Gosu.ai, founded by Alisa Chumachenko, who has a strong track record with gaming startups, provides tools and guidance to gamers using machine learning and through analysing their own playing and then making suggestions. The company has also added real-time voice assistance for in-game feedback and advice. The rise of e-sports in recent years provides potentially fertile ground for companies like Gosu.ai.
A marketing performance reporting platform that automatically converts and visualises information from channels like Google Analytics into visual reports, Whatagraph has grown strongly since its launch in 2015. The company’s digital marketing analytics and reporting software is already used by more than 500 clients around the world, helping to collect, visualise, and analyse data from various marketing channels to build comprehensive reports.
Last week Whatagraph announced a seed extension round of €850,000, joined by influential Finish venture capital firm Inventure, bringing total investment to €1.45m. The company aims to triple its revenue in 2020 and complete a Series A round of funding. “It’s time to put the pedal to the metal,” says Whatagraph cofounder and chief executive Justas Malinauskas.
Source: sifted.euBack to news