Estonian Blockchain e-Residency Home to 35 000 Digital Nomads and Entrepreneurs
Interview with Kaspar Korjus, Managing Director of eResidency at Enterprise Estonia.
1) Could you provide us with a brief elevator pitch on how the Estonian e-Residency program has developed from its inception?
Since its inception in December 2014, e-Residency has attracted a lot of interest from citizens all over the world. The programme started in private beta-mode when Edward Lucas, the Senior Editor of the Economist, was handed his digital ID card by President Ilves and made history as the world’s first e-resident. A few months later, the programme took its first tentative steps when it entered public beta-mode and everyone on Earth was invited to apply.
The number of Estonia’s e-residents has grown substantially and we now have more than 35,000 e-residents from 150 countries. We have great expectations for the future. Indeed, if the current trend continues, 2018 could see as many new e-residents as all the previous years of the program combined.
Over the years, we’ve also realised that it’s important to measure the real value that e-residents gain from the programme too. The main benefit at present is the ability to establish a trusted location-independent company. With e-Residency, Estonia is democratising the access to entrepreneurship all over the world.
2) Since e-Residency does not grant the e-resident right to enter Estonian territory, what is the main purpose and utility for the e-residents?
As I mentioned, the biggest motivation for signing up is the desire to establish a company. Why? Because companies established through e-Residency are trusted location-independent EU companies, which can be run remotely from anywhere on Earth with low costs, minimal hassle, and access to all the tools needed to grow globally, such as international payment providers.
With e-Residency, Estonia wants to ensure that access to entrepreneurship is available to everyone. E-Residency is the most beneficial to business people from outside the EU, who want to have access to the EU Single Market; freelancers from emerging markets who need the possibility to accept online credit card payments but who currently do not have the access in their country; digital nomads who travel the world and who want to administer their company comfortably online from wherever they happen to be; startup entrepreneurs who want to have access to cross-border capital; and businesspeople from the EU who want to lower their company administration costs and who have multiple EU members from different EU countries. As with the digital ID cards, board decisions and contracts can be legally signed online instantly (it removes the hassle and cost of sending documents via international couriers).
3) Are there any particular lessons that have been acquired throughout the program which could benefit future similar e-Residency programs in other countries?
I would advise being patient, inclusive and ambitious.
Patient because the product cannot be perfect when you launch it (I even doubt any product can ever be perfect), which is why we always described ourselves as being in a beta mode. Those who work at startups will be very familiar with the concept of beta mode. It essentially means that we know that not everything is perfect, but we are going to keep improving our ‘product’ while people are already using it and gaining value from it. Change doesn’t happen in the blink of an eye. It takes time and strong managerial powers.
Inclusive because you must always keep in mind that you are doing it for the people, to improve their lives. While physical borders aren’t going away any time soon, the digital world affords new opportunities for people no matter where they were born. So, our message to entrepreneurs is: “Focus on your passion, your ideas, and your product. We will keep the way open for you.”
Ambitious because you need to have goals and a vision of the future. It’s thanks to this vision that you can convince your partners, from both the public and private sector, to follow and envision how we can build the future together. We believe our nations are now undergoing a digital revolution, which will radically reshape them once again — this time into borderless online communities with services that can be accessed anywhere where there is an internet connection. E-Residency is only the beginning, we haven’t fully appreciated how the internet is about to change our world in other ways too.
4) What has been the most, in your opinion, unexpected success of e-Residency?
When we launched the programme, many people were unsure what the actual value of e-Residency would be and whether people would want to sign up. We actually didn’t know all the problems it would solve. Many of the first e-residents were simply excited to join our borderless digital nation and had no plans to use their digital ID cards.
The main benefit at present is the ability to establish a trusted location-independent company so we now also have a goal of helping e-residents establish more than 20,000 new companies by 2025. Most of the e-residents are people who faced barriers to entrepreneurship because of borders and managed to find new opportunities online in our borderless digital nation.
For instance, e-Residency is very successful in countries such as Ukraine and Turkey because access to Paypal is restricted there. It is not something we knew when we launched the programme and we are now receiving hundreds of feedback messages from local e-residents explaining how e-Residency helped them to save their business and we are very proud of it.
5) What are your thoughts on the future of e-Residency programs and in what area lies the largest potential for future development?
On our side, we believe e-Residency should not only be about accessing e-services but also being part of a community of digitally-empowered global citizens, which is why we are now developing a community platform that is focused on helping e-residents connect with each other, learn about how to use the programme and provide them with more tools and opportunities to grow their companies globally.
However, the bigger picture of all this is the question of the future of nation-states. We are facing an unprecedented era of change with multiple waves of technology enabling new business models and reshaping our economies and societies. Most government structures and processes date back earlier than the 1950s and some of them seem to be more interested in building new walls rather than better serving their population in the digital age. They may face irrelevance if they don’t adapt themselves to the new needs, habits and practices of their own citizens.
Progressively becoming borderless and offering solutions such as e-Residency are important steps for governments not to cope with citizens’ higher expectations for government’s technological adeptness and capability in the future. But governments must also show leadership in their own practices and embrace disruptions, such as AI for instance. Governments need to re-design regulation to enable rather than block the adoption of digital technologies, and address risks to ensure no one is left out. It’s only relatively recently that large numbers of people on our planet have gained the power to travel, communicate and trade across borders.
I take this freedom for granted now, but my parents could only dream about these opportunities when they were my age. Now I’m the one dreaming about the even greater freedoms ahead of us. Concepts we consider entirely normal now could rapidly change — or disappear entirely. Many challenges and opportunities await our generation and the next ones, so it is definitely exciting to be actively contributing to shape the future and build invisible states and merging societies for our children.