Baltic startups expect at least 15% turnover growth in 2023

Baltic startups expect at least 15% turnover growth in 2023, according to the Baltic Business Outlook survey, which was conducted by Latvian SEB bank. 23% of polled Estonian startups, which participated in the survey, are expecting their turnover to grow by more than 15%, the same forecast has 50% of Latvian startups and 29% of Lithuanian startups.

SEB study showed that 83% of Estonian startups have focused on the domestic market this year. In Latvia, this indicator is less - 63%, and in Lithuania - 59%.

34% of Estonian startups plan to innovate their products and services this year, 34% of Lithuanian startups will do the same, and in Latvia, this indicator is bigger, and amounts to 46%. 38% of Latvian startups plan to make investments in further growth, 21% in Estonia, and 38% in Lithuania.

Between 2016 and 2021, the number of startups in Estonia grew by 26%, in Lithuania - by 40%, and in Latvia  - by 23%. If to compare the period before 2022 and 2023 year, while the number of employees in startups was growing steadily until last year, in 2023, a lot of startups do not increase their teams. 83% of Estonian startups will not change the number of employees, in Latvia, it is 50%, and in Lithuania - 54%.

According to the survey, Baltic startups face more serious challenges, such as high energy prices, rising inflation, and an increasing tax burden. They affect most startups' economic performance in 2023. Estonian and Lithuanian companies forecast the impact of inflation on their turnover more than Latvian companies. And Latvian startups rate the impact of the increase in the tax burden on wages on the overall economic results of the companies.

The Baltic Business Outlook survey presents the expectations and views of Baltic small and medium-sized enterprises (SMEs) for the year ahead, from them 1,7K companies and 196 startups.

SEB Bank (formerly Latvijas Unibanka, then SEB Latvijas Unibanka) is a part of the Swedish SEB Group.