A story of startup: Latvian young businessmans are feeling broken

Latvian young businessman are feeling broken
Krišjānis Daugulis, the young Latvian startuper

For many years, Latvia experienced serious economic fall due to the consequences of the global financial crisis as well as massive immigration of young people to the western and central Europe.

In order to improve this situation, Latvian government organized several financial agencies that help young people to start own business and rise the local economics rather than foreign ones.


The young startupers are making online software

One of them is Krišjānis Daugulis, with a little business experience he decided to make a small IT company. Beginning as a programmer, he took business courses in Rezeknes University. Now, he has a team of 5 people that make their own startup called Amber housing. The idea of the project is simple, to make a cloud solution for house management.

The young startupers are making online software, by which anyone can storage their contract, bill, report, etc.

Document which is pegged to a particular house or apartment. It will set up automatic payment for rent, keeping all the bills and contracts in the system.

As Krisjanis adds the system is totally transparent and gives maximum information on what’s going on with your house.

«Person will be able to log in and see when there is annual meeting, planned repairs, what’s with status of applications, approved decision of the householder and etc. If private companies and landlords are progressive, they are willing to be more open and to show that they are reliable and there is no scheme».

It also can work the way around and suggest landlord and workers of housing and communal services to digitize all their papers.


Without a assistance of the government, startups are doomed to difficulties

Such systems are already in use in many European countries; however, Latvia is lagging behind the trend.

Krisjanis wants to change it, but without a deep assistance of the government his plans are doomed to difficulties.

Startups drastically differ from regular companies, since young projects require different approach to business.

«We need to put much of energy in finalizing of education of our staff. People have theoretical knowledge, but we try to show them how all work in practice. Of course mindset of people in startup must be set on motivation and sharing of ideas and not only on the execution of tasks».

For Krisjanis it was easier to start business, since Amber housing is a spinoff of a software company Rezbit that has several IT projects.

When there appeared suggestion to head a new one, Krisjanis surely accepted the offer. However, Amber housing begun not in Rezbit Company, but in a business incubator, Latvian financial facility that suggests young people free business courses, revisions of business plans and finances for the first steps.

«I am a member of the Rezeknes business incubator, which is one of Latvian incubators. There are 15 of them. They provide lecturers on a very high level. Mentoring is also provided. I showed them a list of what I want. For example, software licensing about which I know nothing and they said that will find a person who can help me with it».


 IT sphere cannot feed the whole country

Business incubators are starting point for many young entrepreneurs; there they get knowledge, check their ambitions and even find investors.

For Krisjanis it took one year to prepare beta version and find 500 thousand euros of investments for his online platform, since the government is very interested in IT startups, but sometimes he thinks that the government’s proclivity towards software and internet projects is too far.

«I was upset that all those events about business…there are very focused on IT. When they speak about startups, they always think about cloud solution, applications or online stuff. They don’t speak about startups that are about hardware, tourism and other fields. There are lots of young people in incubators and most of them are not in IT field. Some want to open guest houses, power stations and other things. But on the stage of these events are always IT people», Krisjanis says, being happy that his project is in the range of the trendiest industries; however, he thinks that the only IT sphere cannot feed the whole country.


«I feel, I can get broken»

What’s even more disturbs Krisjanis is the lack of openness in Latvian collectives. As he says, the development of startups is very sensitive to the number of ideas in the team.

«It’s important to be more open, not just get the task, make things done and give it away. I read not so long ago that IT startups, all those who make intellectual property, they have to work with their head [leader]. If you have team of 5 people, then all 5 should work with the head, not just as a robot do stuff. If only a leader shares ideas, then it’s very hard. While I am young, I am trying to do my best, but if in 5 years everything will be like this, I feel I can get broken».

Regarding the startup culture of Latvia, Krijanis says that although there is a very serious assistance from the government, he was the only in his group, who decided to make a startup after the graduation.

The most common questions of graduates are more about «Should I use my education for earning money?» rather than «Should I do a startup?».

Moreover, he notices that although there are lot’s of business incubators across the country, most of the startups emerge in Riga.

Sergei Filatov
Sergei Filatov, the Baltic Review author, studies journalism at a Dutch university «HU University of Applied Sciences Utrecht» and writes mostly about politics. The main idea of his projects is to tell that the Baltics is a region, where even small provincial towns rise and flourish in terms of economy and technologies.

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