Seeds of Success
Estonia has been called a hotbed of start-ups. "Life in Estonia" presents some of the dozens of start-up companies active in Estonia. Our selection includes startups which have already found investors and proved themselves in the market, as well as those which have reached the prototype stage and are waiting for a breakthrough.
Text: Holger Roonemaa
Whilst most Estonian start-up companies are aiming for Silicon Valley on the west coast of the United States, the founders of GrabCAD, Hardi Meybaum and Indrek Narusk, have chosen to make their mark on the east coast of the US, in Boston. A wise choice, as today GrabCAD is the creme de la creme of Estonian start-ups. GrabCAD’s objective is to provide an Internet platform for engineers, designers, subcontractors and end producers. It is estimated that engineers spend about a third of their working time designing products or details which someone somewhere has already made. Making such designs available to others provides engineers with the opportunity to work on creating more unique products and details. Over 350,000 engineers have joined GrabCAD to date. The platform provides over 640,000 CAD models and more than 6.5 million downloads have been made from GrabCAD. It is also undeniably the most popular Estonian start-up among investors. Grab- CAD has gone through two accelerators in the USA (Seedcamp and Techstars), and received funding from Ahti Heinla (one of the original Skype developers) and the Estonian Development Fund. To top it all, the company received 1.1 million US dollars in July 2011, 4 million dollars in January 2012 and 8.15 million dollars in October 2012 from the legendary investment company Charles River Ventures (CRV was one of the first investors in Twitter). Therefore, the total sum of investments in the company is over 14 million dollars. What next? Receiving the financial injection from CRV means that GrabCAD is tripling its programming team in Estonia.
Pipedrive hottest start-ups from Estonia. The company was founded by the team of the training company Vain & Partners, which includes Rainer Sass, the man in charge of the support structure of start-ups in Estonia, Garage48. Pipedrive is CRM (customer relations management) software that beats its competitors due to its speed, simplicity and comfort. “In contrast to the usual CRM solutions, Pipedrive focuses on the sales pipe and helps the whole sales team focus precisely on those transactions which they have to work on. In addition, sales managers have a good overview of the transactions in the ‘pipeline’. Pipedrive shows you where the keys to your flat are, and where money is located,” is how the company introduces itself. Pipedrive started off two years ago with the support of Enterprise Estonia’s new business start and growth programme, but as early as the autumn of 2011 they attracted the first noteworthy investment from venture capitalists, a total of 300,000 US dollars. In July 2012, another 700,000 dollars were invested in the company. Behind the investment were Satori Capital, TMT Investments and the angel investors Andy McLoughlin and Christopher Muenchhoff. Both men also participated in the first round of fund-seeking by Pipedrive. Why is Pipedrive so popular? Apparently the cash-flow of the company is already in the “green” and this is one of the things which always attracts attention from investors. Pipedrive’s advantages are a robust business model and more than 1,000 paying customers all over the world.
One of the most unexpected, and therefore exciting, new start-ups, which has already attracted some investments, is Shaka. There are three Estonian men behind Shaka - Raigo Raamat, Mihkel Gusson and Jens Kasemets - and they plan to make their mark in the world of surfers and wind addicts. Shaka’s concept was born when Raigo, as a beginner surfer, was looking for good wind conditions and found out that there was no suitable, comfortable, accessible and trustworthy source of information out there. It you can’t find it, make it yourself. This is how Shaka’s wind-measuring device, known as an anemometer, was born. It is a separate little appliance which can be linked to the user’s smart phone through the “headphone hole”. The information collected in real time about the direction and strength of wind reaches friends in just a moment. The Shaka team got their first international experience this year in China, in the Haxlr8r accelerator in Shenzhen, with a 20,000 dollar injection. In October, Shaka received an additional injection of funds –11,640 euros –from Prototron, a start-up financier founded by Swedbank, the Tallinn University of Technology and Tehnopol. The objective of the funds is to develop the second prototype of the device, which would also measure air pressure and humidity, in addition to wind speed and direction. “We plan to start sales in the next couple of months,” says Raigo Raamat. According to initial information, the device will cost less than 60 USD for end consumers. Currently, Shaka is not looking for new investors and plans to keep that on hold until the company can demonstrate the first market results.
Utility Camp is a start-up, founded by Tanel Ainla and Steve Perkson, which combines electronics and software in order to monitor the consumption of communal services by households. “We want to provide people with a better understanding of how much electricity, gas or water they use,” says Ainla. Whereas communal service providers only give out such information on a monthly basis, Utility Camp will enable you to receive information about your consumption in real time. Utility Camp is currently funded by Toivo Annus and the founders themselves. The first prototype of the device for measuring electricity consumption is ready, and work is under way to make the product affordable for consumers. “It is a wireless little ‘brick’, which has to be attached with double-sided tape to the blinking light in your electricity cupboard. The second analogous brick is placed next to the rooter. Once both pieces are fitted, they start to interact with each other and so the information reaches Utility Camp in real time,” explains Ainla. He says their goal is not to create another smart-home start-up, but something much simpler. “We want to attract people’s attention to one specific problem at a time, and lower the entrance barrier to this area for consumers.” As mentioned, the prototype of the appliance for measuring electricity consumption in real time already exists, and within the next six months Utility Camp is set to bring it to the market.
Browserbite, which enables the users to test Internet pages in different browsers, separated from its mother company Knowit only last autumn. Although Kaspar Loog, one of the owners and the manager of the company, has only been able to fully dedicate himself to Browserbite since September, the company already has 5,000 customers and the first ones have started to pay for the service. “People usually think that each web page works in every browser in the same way, but the reality is that standards vary. This means that developers are always overworked and customers are always upset when their web pages in some browsers look ugly or include mistakes,” explains Loog. This is where Browserbite comes to assist developers. To put it very simply, it analyses a web page when it’s being created and within 20 seconds shows where in the browser a mistake will occur. “In principle, it is a kind of ‘find the five differences’ game,” says Loog. He adds that this task would take a layman at least fifteen minutes and even then only a third of the mistakes would be found, whereas a professional would identify two-thirds of the mistakes in the same time.
“Browserbite does the job in just a few seconds thanks to the fact that its analysis motor uses special algorithms.” Loog confirms that it is precisely this automated and effective analysis component which gives Browserbite an advantage over competitors. As mentioned, Browserbite already has over 5,000 users. The free-of-charge version compares 60% of browsers and the pay version gives a result on 90% of browsers in use. In the new year, the aim of the company, founded by Loog, Tonis Saar (who works on R&D) and Marti Kaljuve, is to widen its activity on mobile platforms and to enlarge its customer base. So far Browserbite has funded itself. Loog says that they have considered finding investors but that would mean hiring another full-time job employee. “We are open to ideas on attracting funding, but we are looking for ‘smart money’ and we will try to raise funds in a later phase.”
Source: Life in Estonia, winter 2012