Disclaimer: The purpose of this paper is not to bad-mouth or point fingers but to shine light on what I think is the core problem blocking innovation in Lithuania. Only when you identify the core of the issue can you try solving it, right?
In this paper I will argue that the majority of problems in our country, especially the ones associated with innovation, are connected to a single denominator. My goal is to shine light and articulate that underlying problem, which I’m sure is at the back of your mind as well. Let’s try to raise it to the surface and start the discussion.
I think most Lithuanians (and foreigners who have lived here) would agree that there are many issues floating around our home country. Weak economy, corruption, foreign pressures, talent leak, emigration, etc. I could go on but that’s not the point. What’s interesting is that I think all these problems and many more are just symptoms of an underlying systematic misconduct.
It all comes down to this - We Don’t Invest In Great Talent.
Innovation happens when you give the right resources to talented people. Both startups and innovators have proved that. Even more, sometimes great people make stuff happen with marginal resources all together. That’s why it’s absolutely vital to find and engage with them.
Most innovators would agree that talent acquisition is the most important thing in building successful innovation.
- With great talent you can make average ideas successful.
- With great talent you can pivot accordingly to changes in the market.
- With great talent you can build something, which haven’t existed before. That’s exactly what we need to do.
Now, what do I mean by the Great Talent?
To my mind, and again I welcome debate on this, there are three main parts of a puzzle, which makes Great Talent: passion, domain knowledge and relevant experience (PDE).
- You need passion because people will only put in long hours if they truly believe in the bigger picture of the task in hand.
- You need domain knowledge to deliver quality results. That’s what we especially lack in Lithuania.
- You need relevant experience to know what not to do and make the sure the long hours; dedication and knowledge don’t go to waste.
So… Innovation happens when you assemble enough people with strong PDE and build them into action teams with a unifying goal.
However, finding the right talent is probably one of the hardest things to do. It requires resources, time and determination.
But most of all it requires a culture which appreciates the importance great talent and gives it the highest priority.
Current culture in Lithuania most often than not unfortunately has other priorities. We Don’t Invest In Great Talent but we are happy to waste time & money on…
- Real estate - building new unnecessary walls has become almost a must. We’ll build another innovation center, which means we are innovation. Bullshit.
- Bribes – no comment necessary.
- Quantity over Quality – more average is better than a few great.
- Irrelevant experience – people who have done something somewhere but on in the area necessary.
- Useless business development programs with irrelevant mentors.
- Local vs Global – we ignore the potential of utilizing talent mobility. Choosing average locals over talented foreigners with great PDE.
- “Milking” the EU… for more “walls”, “Real Estate” and other stuff we have plenty off.
- And much of other crap that only allows certain people to fill in the necessary ticks and get following access to funding but doesn’t improve the status quo.
In a country where it’s easier to fund-raise a few million of another building than raise a few hundred thousands to pay European salaries and facilitate suitable support structures for a group of great talent - innovation can’t really flourish.
We Don’t Invest In Great Talent!
We just don’t understand exactly how important it is because it’s not embedded in our work ethics.
Let’s get back to Lithuania/Estonia analysis and the startup world whilst keeping the previous thesis in mind.
Since 2005 Estonia has managed to strengthen its position as the leader in the Baltics both overall and in startup industry.
Key facts about Estonian startups:
- They have two startups in the 500 Startups.
- They have a strong accelerator with kick-ass alumni raising millions.
- They have mandatory coding lessons for first-graders.
- They have a strong startup-orientated co-working and events center in downtown Tallinn – Garage48 Hub.
- They have the President present at every single significant startup event in country also traveling around the global promoting Estonia as a startup nation. Heck, he even pitched Zerply on the Seedcamp Tallinn stage.
- Very important. They have Jon Bradford heavily involved in shaping the eco-system and invested in that. That’s your domain knowledge & unrivaled experience in the area.
- Most important. They have a few right people with strong PDE driving the leading startup initiatives (Government tools, incubators, lobbyists, accelerators,), who really know a lot about startups and are passionate about what they are doing.
I know what you might be thinking – “But they have Skype…”, “It’s only PR….”
Yes, Skype helped. Good PR helped.
But what’s going on in Estonia at the moment is a result of a coherent investment in Great Talent not a lucky fluke. Because it’s consistent and has logical sequence to it.
Several years ago in Estonia a revelation must have taken place when they understood that for a small country with limited resources there is no other option to become prosperous than fostering innovation and I assume startups seemed to be the cheapest way to do it.
So they’ve started building the local eco-system by acquiring great foreign and local talent with complimentary PDE. They’ve used the business network via Skype, Jon Bradford and many other influencers happy to help, to get in touch and acquire right talent. That’s how a smart startup would behave.
Don’t get me wrong. Estonia is not a perfect country. There is no such thing. However, what they are good in is prioritizing and focusing on what truly matter – People. Everything else follows as a result.
They were lucky enough to objectively evaluate their talent pool and understand that some positions will have to be outsourced in order to make sure that invested capital will achieve best possible ROI. They were comfortable enough to say: “We don’t have these people here. Lets find them elsewhere”. And they did. Afterwards everything what followed was logics and hard work, which equals to innovation.
To sum up, Lithuania is not innovating as well as Estonia because we don’t invest in Great Talent as much as we should.
I urge everyone to start looking at the Lithuanian startup eco-system as a startup itself.
- Startup, which has raised some capital yet remains very much bootstrapped. (Governmental support via Enterprise LT)
- Startup with a few successful evangelists (Eskimi, Campalist, etc.).
- Startup with a few poorly coordinated nevertheless operating departments under development (Startup Highway, HubVilnius, StartupSpace, Practica Cap, etc.).
- Startup with a very strong competitor in the North who was first to market and continued to innovate after acquiring the right people for the job.
- Startup with not enough domain knowledge and relevant experience yet.
- Startup with smart and open management capable of objective self-assessment.
- Startup with a 12-18 month runway to prove the market and settle as a proven business proposition (i.e. a structure, which delivers investable startups competitive on a global scale.)
Currently so many of us depend on a very few working for Enterprise Lithuania and other structures set up to create a foundation of Lithuanian startup eco-system.
With this paper my hope is to start a discussion on how should we change our approach to building the eco-system in order to make a leap and catch with the rapidly developing world.
We must make talent acquisition the priority and start taking everything from there. It’s a cultural paradigm, which we need to start changing together. And it’s not just startups. It’s society as a whole.
In my next post will focus on actionable solutions on how I think we can build an eco-system more efficiently starting people-first.
I hope these ideas will resonate with you guys and again I encourage sharing your thoughts on my blog or Facebook.