While not as well-known as its more digitally advanced neighbor Estonia, the tiny Baltic country of Latvia in northeast Europe is home to a blossoming startup ecosystem.
A country with a population of under two million, Latvia is home to a handful of successful tech companies and, through initiatives with the country's technical universities, several vibrant cooperative programs between startups and the academic sector.
Latvia also has a history of inventing and producing groundbreaking innovations – from the sub-miniature Minox 'spy camera' used by intelligence agents in the Second World War and Cold War, to the first heavy multi-engine aircraft in the world, created by famous aviator Igor Sikorsky.
After years spent working in the business and investment banking world, Kayumova – now the CEO of mapping tech startup GreenGrowth – was lured to agritech by the prospect of being able to tackle a global issue affecting millions of people worldwide.
"Agriculture is one of the most dynamically developing industries," Keyumova tells ZDNet. "It is focused on the global challenge of feeding a growing human population with ever-limited scarce resources."
GreenGrowth develops real-time yield-mapping technology that is designed to help farmers increase their efficiency.
Issues such as land degradation, soil erosion and climate change have also plagued Latvia and the rest of the Baltic region in recent years, where agriculture and farming are among its main economic activities.
"We provide farmers with heat maps, analytics about their fields, and we show how the actual yield is distributed across these fields," Kayumova explains.
"There is a lot of potential here in the Baltics and Latvia since there a lot of small and medium, and big agribusinesses that are in need of this technology."
A motivated, multilingual workforce
According to ecosystem experts, Latvia's competitive IT workforceis what makes the country's startup ecosystem tick.
Alina Silina, from the Latvian Startup Association, puts this down to Latvian workers' combination of solid work ethics, high motivation and openness toward new challenges – as well as the fact that the Latvian labour force "has one of the highest rates of university attendance in the world."
Multilingualism is another distinct feature of the local labour market in the EU member country – besides Latvian as the official language, 87% of Latvians under the age of 35 speak Russian, and 61% of people of the same age range speak English, while German and Scandinavian languages are also widespread.
A number of science commercialization programmes are currently being run by the Latvian government aimed at accelerating the growth of 'deep tech' startups – organizations set up to tackle significant engineering or scientific challenges – and promote collaboration between scientists.
ENOT is one of the most promising deep tech startups emerging in the country, developing a technology that compresses huge neural networks so that they can be utilized on 'edge' devices like smartphones, IoT and other connected devices.
As ENOT's CEO and cofounder Sergey Alyamkin explains, its technology is designed to help AI developers with limited resources save on computing costs by making neural networks smaller, faster and more energy-efficient.
"Our goal is to reduce neural network computing power requirements without sacrificing performance and accuracy," says Alyamkin, who has more than 10 years of experience as a data scientist for global companies and Silicon Valley startups.
Finding tech talent in Latvia is one of the biggest challenges facing those interested in the development of the country's IT industry.
ENOT currently has a team of seven developers – which is relatively big for a seed-stage startup, Alyamkin notes – although because developers in Latvia are difficult to find, the company has also had to invest more in training the developers that they do have.
That said, the tech workforce Latvia does have is much more affordable than the rest of the region, such as startup-rich Estonia.
Acure is another Latvian deep tech startup. Founded in 2019, the company is developing an automated data-monitoring and observability tool to make it easier for IT teams to manage large volumes of incidents, alerts and requests.
Acure's CEO, Nikolay Ganyushkin, got the idea when he was working as a head of IT operations at a major online service that had more than 20 million users and 10,000 support requests daily.
"We wanted to get rid of the engineers' night shift and replace it with a robot," Ganyushkin tells ZDNet. "That's how the product was born."
While the labor market in Latvia is fairly small, making tech hiring difficult, Ganyushkin says the country offers a friendly environment for tech startups, which benefits both businesses and employees. This includes legislation providing low flat social tax and no individual tax for startup employees.
Yet attracting tech startups into Latvia remains a challenge. While the country might lag Estonia when it comes to the maturity of its tech ecosystem, it is getting there. Venture capital funds such as New Nordic Ventures are looking to support promising Latvian and Baltic startups in different verticals, including AI, agritech, deep tech and fintech.
"In general, the Baltic region itself is super-well perceived by international VCs, mostly thanks to our neighbor Estonia," says Dmitry Saikovsky, general partner and co-founder of New Nordic Ventures.
"While we lack behind their experience at the moment, in terms of the ecosystem and investments, we have covered all the levels for companies to get funding, from their early beginnings, to reaching international VC funds."
All of this effort is promising in the long run for the country and for the development of its startup ecosystem, as well as its IT industry, says Saikovsky.
"We're a small population, but there is definitely a lot of IT talent in the country – and big potential."