Estonian startup sector companies in the deep tech field attracted the most investments. Investment deals worth nearly 200 million euros were concluded in three quarters, accounting for over 60% of all funds raised by the Estonian startup sector. Simultaneously, there was significant revenue growth that surpassed the average for the Estonian startup sector.

According to Startup Estonia, 165 deep tech companies operate in the Estonian startup sector, with a total turnover of 233 million euros by the end of the third quarter of the year. In terms of revenue growth indicators, deep tech companies outperform the sector average. While the Estonian startup sector grew its revenue by 13% this year, the revenue of deep tech companies increased by about a fifth, 19%.

“The Estonian deep tech sector is in good shape today, and the interest of international investors is noticeable.”
Vaido Mikheim, DeepTech Sector Project Lead ad Startup Estonia

Vaido Mikheim, DeepTech Sector Project Lead at Startup Estonia, highlighted that founders and local and international investors are now prioritizing the development of science and technology-intensive businesses.

Investors want to see strongly protected intellectual property

“The Estonian deep tech sector is in good shape today, and the interest of international investors is noticeable. This was also proven by the Tech Tour investor meeting held in Tallinn for the first time last month, with the participation of over 50 major international investors. The feedback from investors on our deep tech companies was positive and constructive. They see potential but also want to see more clearly defined and strongly protected intellectual property,” said Mikheim, hoping that news of new funding deals can be expected in the coming months.

Among deep tech companies, Defsecintel had the highest turnover by the end of the third quarter this year (32 million euros), followed by Threod Systems (25.4 million euros), Cleveron (23.4 million euros), Starship Technologies (19.5 million euros), and Comodule (15.2 million euros).

Eighteen companies have raised investments totalling 198.7 million euros. For comparison, 86 million euros had been raised through 20 deals by the same time last year. The most significant investments this year were raised by Starship Technologies (90 million euros), Stargate Hydrogen (42 million euros), Elcogen (30 million euros), Pactum (18.4 million euros), Äio (6.1 million euros), GScan (3 million euros), and UpCatalyst (2.3 million euros).

As of the end of the third quarter, 2,409 people were employed in the deep tech field, accounting for 17% of all employees in the Estonian startup sector. Companies in the field have paid 42.7 million euros in labour taxes to the state, which is 10% more than at the same time last year.

Deep tech companies pay millions of euros for labour taxes

Among the companies operating in the deep tech field, Milrem was the largest employer as of the end of September, with 266 employees and the largest payer of labour taxes, paying 4.1 million euros in three quarters. Starship Technologies employed 166 people and paid 3.3 million euros in labour taxes. The third-largest employer was Cleveron, with 138 employees by the end of the third quarter, and the company paid 2.3 million euros in labour taxes.

“They (investors) see potential but also want to see more clearly defined and strongly protected intellectual property.”
Vaido Mikheim, DeepTech Sector Project Lead ad Startup Estonia

A large part of all deep tech companies, 121 companies, operate in Harju County, about a fifth, or 27 companies, work in Tartu County, and five companies are registered in Ida-Viru County.

Statistics for the Estonian startup sector include startups in its classical definition and fast-growing innovative technology and growth companies operating in Estonia for over ten years and reaching sales transactions. 

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