Konradas Frankonis decided to teach his compatriots how to taste yoghurt and appreciate waffle sandwiches, so he opened a snack bar in one of the shopping malls of Vilnius one year ago. He says he still works seven days a week and finishing work at 5 PM is but an unrealistic dream. Frankonis admits that if it were not for help from his relatives – advise from his interior designer mother and chef brother who helped out with the menu – starting a business would have been a much more challenging and costly venture.
“The toughest part is finding a venue. It is key, because in business what matters is attracting people. The second challenge is securing funding, because in business your own money is not enough and finding outside funding is tough,” says Frankonis who runs the snack bar Jogurtainė.
Many of his compatriots would also love to open their businesses, but half of those surveyed by SEB Bank admit they do not have enough knowledge.
Another impediment is that they often do not have an idea for a business. What’s new is that not quite business-friendly environment or reluctance to take risk are no longer seen as the main obstacles to starting business.
Still, one in five people surveyed in Estonia and Latvia ran their own businesses, while in Lithuania there were only half as many.
“Lithuanians are willing but not too active, since only eight percent own businesses, while every fifth Estonian is an entrepreneur. Environment factors adverse to business are slowly but receding – there’s now enough information, red tape has shrunk, it is now simpler to open a firm and outside help is readily available. In the end, the true reasons surface, people turn to themselves and admit that the main reason why they are not setting up businesses is that they do not have ideas or enough resolve and courage,” says Virginijus Doveika, director of SEB Bank’s retail banking division.
According to the study, those interested in setting up a business rely on the internet for information or turn to government agencies for assistance. A third of the polled said banks, business consultancies or friends and relatives were their main sources of information.
Meanwhile the number of young enterprising people willing to take risks, the so-called startups, has grown three-fold. Last year, 25 international and Lithuanian funds invested into their ideas. Moreover, startups from Ukraine and Belarus also often choose Lithuania as the springboard and testing ground for their business ideas.
“Lithuanian and foreign investors have become more interested in technology startups rather than services. Investment in 2015 for venture capital funds is estimated at up to EUR 100m and it’s growing each year; moreover, the startup business is realizing the importans of going global, so some 40 percent of startups are global, they realize that the Lithuanian market is a great ecosystem to test their ideas,” says Gediminas Pauliukevičius, head of Šiaurės Miestelio Technology Park.
According to the survey results, in Lithuania most enterprising are men between 30 and 39 who live in urban areas. Kaunas is the most enterprising city in the country.