How to make illegal tech legal, with Accelerate Estonia
And why we’re launching the Future of Regulated Markets Summit
What’s constraining companies’ growth, blunting startup policy & investment, and slowing innovation where it most impacts people’s lives?
Broken regulators. Whether it’s lack of resource, inflexible rules, or limited risk appetite, regulators risk slowing progress in the markets that matter most: health, bio, fintech, climate, AI and more.
But this is solvable.
Meet your new favourite ‘Estonia has fixed this’ meme: Accelerate Estonia, which works to clear regulatory barriers for novel technologies and make sure that Estonia reaps the economic benefits — often way ahead of other countries.
Learning from this example is mission-critical to helping companies scale in the UK. So read on to hear more about how they work, and join us on 20th Feb for the Future of Regulated Markets Summit, where we’re bringing together a curated and ambitious community of investors, founders and policymakers focused on regulated markets, in conversation with the Minister for Investment and Regulatory Reform, Lord Johnson.
Spaces are now very limited, so register here:
This month:
🎙️Interview with Accelerate Estonia, how Estonia helps frontier companies in regulated markets move quickly
⏰ Form Updates: Launching the FORM Summit, announcing our investment in Triple, and Leo & Andrew on the campaign trail
Oliver Rätsep, Accelerate Estonia, on unlocking regulatory barriers for frontier tech
Oliver Rätsep is part of a team in the Estonian government dedicated to finding and supporting technology companies facing regulatory barriers to move quickly and scale their impact. While part of the bureaucracy, their end customer is the private sector: if there’s a highly scalable, novel technology with significant benefits for Estonia they can unblock, they want to help. It’s a markedly different mindset than so many other governments, but also shows that it is absolutely possible to solve the bottlenecks that hold innovation and public benefit back. We hope other countries learn from their example.
Our takeaways from the interview:
Accelerate Estonia exists to identify and enable technologies that could have significant economic impacts is blocked by regulation, such as novel foods, new water treatment techniques, or medicine deliveries.
As part of the Ministry for Economic Affairs, and given Estonia’s small size and minimal bureaucracy, the team can move quickly on behalf of entrepreneurs, aiming to unblock opportunities within a year.
International companies can leverage Estonia as a platform for scaling into the broader EU, or as a testbed to gather safety evidence for regulators in their home market.
Find the full interview transcript at the bottom of this email.
Form Updates
Triple, which builds transaction enrichment infrastructure for the fintech ecosystem, announced their seed round and we’re delighted to be on board! Triple are already working with Pleo, Trade Republic and Ben, and we can’t wait to see where Mario and the team go next. We also closed another deal in Q4 that we’ll share more about soon.
Patrick reflected on 5 fundraising traps to avoid in this market. Tl;dr? Don’t let a sub-optimal process disrupt your momentum and stall your fundraise.
Andrew also joined a breakfast at 10 Downing Street recently for UK investors and entrepreneurs, while Leo repped our new #fixtheregulators merch at the DSIT Secretary of State’s speech about supporting companies to scale in the UK:
Full Interview with Oliver Rätsep, Accelerate Estonia:
FORM: How does Accelerate Estonia work and why are you doing this? How does it fit into Estonia's broader strategy on technology?
OLIVER RÄTSEP: We want to create new market opportunities which benefit entrepreneurs, industry, Estonia and the world. We’re looking for novel, b2c and b2b solutions that are blocked by systemic, regulatory barriers and need public sector intervention. If there’s a clear ask of the public sector, significant economic benefits for Estonia, and a highly scalable, novel technology opportunity, we want to help.
Our program operates within the Ministry of Economic Affairs, granting us the authority to easily ring up any ministry or public sector crew without much hassle. Despite our affiliation with the Ministry, our primary focus is on serving private sector companies. They are the ones grappling with regulatory challenges and obstacles that require resolution from the public sector.
2. Has there been any bureaucratic or social tension from moving quickly and 'making illegal stuff legal'? How have you managed this?
Estonia's small size and minimal bureaucracy offer a significant advantage, enabling faster project completion compared to most democratic nations. Our goal is to wrap up projects within a year, with some taking 6 to 18 months. Currently, we're collaborating with a wastewater treatment company for a regulatory tweak and a technology firm addressing pharmacy vending machine regulations. Despite potential variations in project duration, even a year is notably quicker than counterparts in Europe.
In our project approach, we conduct an initial validation with the public sector to gauge interest, requirements, and assurance for regulatory changes. This proactive step streamlines the process, ensuring a smoother implementation, as government entities may lack the time or inclination to prioritize swift changes.
3. Can you give us a sense of what the impact has been for investment & start-up growth?
We will see the impact in the next 2 to 3 years, once regulatory changes impact the whole sector and there are multiple players working on new market opportunities. But in the short term, both the public sector and private sector here in Estonia are more and more aware of what we’re doing at Accelerate Estonia and how we can help. We see more and more companies coming to us already, and this year we’ll be expanding to the UK to see how we can help UK companies to solve a regulatory issue and provide Estonia as a testbed and launchpad. Then companies can either scale into the EU — we also look at which other countries in the EU would find it easiest to adopt similar changes to help companies expand — or come back to the UK with the evidence they’ve been able to generate here.
4. What powers/levers have you needed to succeed? What could other countries learn about how to do this well?
Firstly, the authority from being part of the Ministry of Economic Affairs has been really important. We’re not just advisers but hold the mandate to remove regulatory barriers, as well as doing the heavy lifting for other ministries.
Secondly, the tone of our brand is critical for marketing and advertising to companies that this service exists, and attracting companies to work with us on this. [i.e. ’let’s make illegal stuff legal’].
And finally, our team also combines extensive public sector backgrounds and serial entrepreneurs, because we’re a small team of 7 that needs to be a bridge between the private and public sectors. We need a healthy balance of understanding of both sectors because very often these worlds just don’t understand each other.
As always, if you’re building in the future of regulated markets, get in touch.