Enterprise Estonia Pumped Millions Into Short-Lived Companies (6)

Published: 12.04.2012 11:07

Photo: Postimees/Scanpix

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In the last decade, Enterprise Estonia has pumped money into a startlingly large number of businesses which by now have shut down.

The agency, however, does not find the figures diconcerting, Eesti Ekspress reported.

In 2002, Enterprise Estonia handed 120 startups grants totaling at around 576,000 euros. In 2012, 66 of these enterprises have been stricken off the business register, dissolved or declared bankrupt.

Another example was drawn from 2006, when the foundation distributed 1.2 million euros of grant money among 161 companies, of which a quarter are now dormant or struggling in debt. A similar pattern continues in more recent years as well.

To Dmitri Burnashev, head of the business startups division at Enterprise Estonia, the figures are surprising, yet in a positive sense. "World practice has shown that only one-third of businesses manage to live longer than 10 years. [In Estonia] the share is 45 percent," said Burnashev.

 

Ingrid Teesalu

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Comments (6)

  • Foreigner

    12.04.2012 11:23

    This is actually good news - it's visible how many startups are thriving in Estonia, and how it's improving the work conditions and keeping bright Estonian minds in Eesti... If one in a hundred becomes the next Skype, it will pay off.

  • Skeptic?

    12.04.2012 12:54

    To assume that "not bankrupt = thriving" is a stretch. But the numbers do appear quite positive.

  • Mart Mang

    12.04.2012 14:44

    Maybe Enterprise Estonia should change their investment strategies. I mean if half the money went into the rabbit hole, you-all need a plan B real fast...

  • Juhan021

    12.04.2012 14:55

    Enterprise Estonia is actually one of those very few things in Estonia to be really proud of. In short run it is not as important that high number of small start-ups fails. It's the fact that people can have go, to try it out. Once they've done it, there's nothing to say they won't try again in future - but now they've got some experience behind them. Keep up the brilliant work you are doing as in future we might look back on this as we do at the moment to the 'buying out farms'-program of the 1920's. It has the potential to change the social landscape of this country for good, and for better.

  • ameeriklane

    12.04.2012 15:21

    I'm trying to get some money from them right now and it's a huge pain. The "consultant" in their organization they assigned to me doesn't have time for a call for the next 2 weeks, and I am not allowed to apply without talking to them first. That reminds me, I need to follow up on my last email that they never replied to....

  • Mart Mang

    13.04.2012 13:47

    @ameeriklane: I bet if you changed your name to "eestimees", you might find it easier going...