Page 26 - bne monthly magazine June 2024 Russian Despair Index

26 I Companies & Markets bne June 2024
Of late, there’s been a slow-burning sense in the Latvian capital Riga that things might be about to get even better for the city’s tech start-ups; nowhere more so than at TechChill, the largest technology and innovation event in the Baltics, which this year was abuzz with talk of a new Startup House – a hub for start-ups, investors, talent and expertise that aims to provide the final spur to greatness that the Latvian start-up scene has previously (arguably) been lacking.
Andris Berzins is one of the co-founders of Change Ventures, set up in 2016 to invest in start-ups across the three Baltic states. Last year it secured €20mn to launch its third
fund investing in the Baltic states, focusing on pre-seed investments in founder-driven companies.
Berzins is part of a group of stakeholders who have been trying to push the start-up agenda politically in Latvia for some time.
“And there’s actually been a lot of good initiatives,” he says. “We launched a start-up tax some six years ago, which means that if you qualify as a start-up there are various tax incentives to lower the cost of getting a business up and running. We also successfully lobbied for a change in the stock option law – we now have the world’s most attractive stock option law, bar none.”
“It’s even marginally better than in Estonia,” he adds. Berzins believes that one of the things a small country such as Latvia offers is the ability to move fast.
Open just a couple of months, Startup House Riga is a non-profit initiative that aims to have “all the right people in one building, mingling in the kitchen,” says its CEO Egita Polanska.
Startup House is already home to a couple of exciting firms: Oruga is developing the world’s first all-terrain electric monotrack vehicle, while micromobility start-up Mosphera produces industrial on- and off-road e-vehicles – some of which have been successfully used on the frontlines by the Ukrainian armed forces.
TechChill was also the scene for the launch of another major initiative that has the potential to drive Latvia’s start-up ecosystem forward – StartSchool, which Anna Andersone, one of the founders, describes as “a new-generation tech business school”.
“The ingredient most missing in Latvia and the region, and why we don’t get more early stage start-ups popping up, is the lack of technical co-founders,” says Andersone, who is also the CEO of Riga Tech Girls, emerging-europe.com said.
Russia prepares a crackdown on crypto Vladimir Kozlov in Cyprus
Russia is preparing a crackdown on cryptocurrencies in a bid to establish control over the segment that so far has been operating largely under the radar.
The State Duma, the lower chamber of the Russian Parliament, is currently considering a bill on the regulation of cryptocurrencies in Russia. The document stipulates a complete ban on the organisation of crypto circulation as of September 1, 2024, making exceptions only for officially registered miners and projects by Russia's central bank.
In accordance with the draft, only Russian firms and individual entrepreneurs included in a special register will be able to mine cryptocurrencies. Private individuals will be allowed to mine cryp- tocurrency without being included in the register, provided they comply with the energy consumption limits set by the govern- ment, which could discourage them from mining activities.
The bill also prohibits advertising of digital currencies and the organisation of their circulation.
Control over crypto
Under the new law, Russian miners will be obliged to report total amounts of the crypto they have mined to the tax service,
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also providing crypto addresses to which the mined currency has been deposited.
The aim of this stipulation is to eliminate the possibility of using these funds "for money laundering, financing of terrorism or other criminally punishable acts," legislators claim. Also, authorities will have the right to totally ban crypto mining in the country's specific regions.
Russians have turned to cryptocurrencies to avoid capital controls and sanctions making it hard to transfer money. Now the government is cracking down on the industry in order to keep control of money. / bne IntelliNews