By Uglobal Staff
Lithuania, one of the three Baltic States in north-eastern Europe, has launched a startup visa in hope of attracting a new generation of non-EU entrepreneurs — and applications are being assessed not by an immigration officer, but by a panel of venture capitalists, accelerator executives, and other members of the country’s startup community.
The centerpiece of the application process is an online video interview with the panel of experts.
“It was a bit like Shark Tank,” says Rajat Ojha, CEO of India-based Serious Gaming Private Limited, one of the first entrepreneurs to be awarded a visa under the program. The panel was “very, very friendly,” he adds. “But it was certainly different.”
The aim isn’t to intimidate investors, explains Startup Visa Lithuania project manager Natalja Lichodedova, but to evaluate applications based on their true business potential rather than according to rigid bureaucratic criteria.
“Members of the committee have the knowledge and the experience to do that quickly and effectively,” Lichodedova says. “It is beneficial for all parties.”
Successful applicants, who must be at least part-owners of the new company, receive one-year visas, renewable for a second year, after which they can apply to remain in Lithuania using conventional immigration programs.
The program is intended to boost Lithuania’s high-tech sector, and is chiefly targeted at biotech, nanotech, IT, mechatronics, electronics, or laser-tech entrepreneurs. Still, applications will be judged on their merits: an entrepreneur planning to open an auto dealership might not pass muster, but someone planning a fintech or medtech startup would probably get the nod, says Nerijus Zaleckas, a senior associate at COBALT Lithuania.
“The whole idea is basically about advanced technologies,” Zaleckas says. “You need an idea that is interesting to the committee.”
In keeping with the program’s high-tech focus, applications are handled online, with applicants logging onto a website to begin the process, then conducting a video interview that includes a five-minute pitch to the panel of investors, plus up to an hour of follow-up questions.
The interview is “an opportunity to pitch your idea,” Lichodedova says. “It’s not always possible to explain your brilliant business plan in an application form,” she explains. But it’s also a screening process, and the panel of experts will be looking for weak links in your business plan.
“When applicants pitch their idea, it is not difficult to establish how much preparation went into their presentation,” Lichodedova says. “The best advice for the video interview is to take it seriously.”
The program launched in early 2017, and so far 19 entrepreneurs have been approved for startup visas, with another 57 applications still being processed, Zaleckas says, citing data from Enterprise Lithuania, the parent organization of Startup Lithuania.
One visa recipient, Russian digital-media software company MUUL, had previously struggled to secure visas to operate in Lithuania, with company officials blaming a lack of high-tech knowledge among immigration officials. That’s something the startup visa program’s panel of experts was designed to correct.
“When we learned about the startup visa program we instantly decided to engage. And it was the right decision,” said MUUL’s creative director, Oleg Kornev, in a statement.
Many more businesses like Serious Gaming and MUUL are waiting in the wings, says Zaleckas, who this year made multiple trips to Belarus and Russia at the invitation of the Lithuanian government to explain the visa to prospective applicants.
Zaleckas expects some interest from business operators in China and Israel, but predicts that most applicants will come from Russia and Belarus, with Lithuania’s location making it an attractive destination to its non-EU neighbors.
A seminar that Zaleckas hosted this spring in Minsk drew more than 90 attendees — a remarkable number for a talk about a visa program, he says. “And we’ve had feedback that many of the people who came are actually interested in getting these visas,” he says. “They know Lithuania can be a door to the European Union market.”
The visas are also attractive because they allow entrepreneurs to bring family members from day one, Zaleckas adds, and because there are no strict capital requirements to contend with.
Startups must show they have the resources to operate for a full year, but can judge for themselves how much money will be required to make that happen. Startup Visa Lithuania is also offering to make introductions to local venture capitalists for successful applicants.
The startup visa application process is free and very straightforward, Lichodedova says, and thanks to the online system would-be entrepreneurs don’t have to stump up the money to travel to Lithuania, or even to their nearest consulate, in order to apply.
Once the panel of experts signs off on a business plan, the applicant is issued a letter of acceptance, which they submit to immigration authorities along with a processing fee of 114 euros, or 228 euros for fast-track handling. That process usually takes two months, or one month for fast-track applicants.
While applicants do have to provide some basic paperwork like passports and proof of health insurance, Zaleckas says the immigration portion of the application is basically a formality. “I can’t think of any grounds for which a person would be rejected,” he says. “If you don’t have a criminal record you should be okay.”
The critical part of the application, Zaleckas says, is coming up with a thoughtful, detailed business plan that serves a clear need in the Lithuanian market. “The most important document is your idea,” he says.
Like Lichodedova, Zaleckas stresses the importance of the initial video interview, which he says could trip up applicants who fail to put sufficient time and energy into developing their pitch.
“You need to prepare like for an exam at school,” Zaleckas says. “These are people who are actually playing in this market, and they can understand whether or not your idea has potential.”