Development Fund analysis: how to increase research-intensive entrepreneurship in Estonia

Today, Estonian Development Fund published the second part of their smart specialisation analysis, focusing on practical advice and measures to overcome the bottlenecks that are slowing down innovation in Estonia. The analysis was commissioned by the Ministry of Economic Affairs and Communications and the Ministry of Education and Research, which plan to invest close to 140 million euros in smart specialisation activities during the 2014-2020 period.

According to Development Fund’s economy expert Kristjan Lepik, the first stage of the smart specialisation analysis was completed in late 2012, identifying the areas where research and business have the most potential for cooperation in Estonia, and the document that was completed this week as a continuation of the work aims at pinpointing specific deficiencies that need to be eliminated so that innovation in Estonia can grow. “The main emphasis of this work is practical – specific measures have been offered for alleviating or eliminating the deficiencies; the ministries can take them into account in their strategies for using structural funds,” Lepik explained.

Lepik said that one of the important problems in Estonia today is that the research carried out in universities finds too little application in business. “Development Fund proposes creating a package made up of several measures to this end, whereby the researcher, entrepreneur and the capital are brought together, creating a platform for research-intensive entrepreneurship,” Lepik added.

“Also, the export of wooden houses, for example, has increased significantly in Estonia in the past five years, but innovative components find little application in their production – utilising innovative technologies can significantly increase the added value of the sector as well as the profitability of the companies,” Lepik said, in giving an example from the fresh analysis about how business with low research-intensity hinders innovation in Estonia.

The smart specialisation analysis of deficiencies and new opportunities can be found here.

Estonian Development Fund is a venture capital fund and thought centre established by the Estonian Parliament with the aim of investing into internationally orientated innovative Estonian companies, monitoring developments and starting growth programmes to develop entrepreneurship. Development Fund’s investment company SmartCap manages the largest startup portfolio in Estonia, containing 16 companies.

Additional information:

Kristjan Lepik

Economy Expert of Development Fund