Transformations  in
Business & Economics

EMPIRICAL EVIDENCE ON THE STARTUP GROWTH IN THE BALTIC REGION HIGH TECH LANDSCAPE
Laima Okuneviciute Neverauskiene, Daina Klepone

ABSTRACT: The lack of a clear definition and the absence of economic data make empirical research on startups challenging. This in-depth study utilizes econometric tools to analyse firm-level financial data from three countries and provides empirical evidence on startups in the Baltic region, exploring their distinctive characteristics, growth trajectories and growth determinants in comparison with other business sectors. The analysis has highlighted that startups in the Baltic region are predominantly young, small companies in high technology and knowledge-intensive sectors, characterised by high growth rates and labour productivity. The peak of their growth is reached between 3 and 6 years of operation when the strong correlation between revenue and employment growth reflecting the crucial role of human capital in startup development is revealed, as well as the resistance to low profitability levels. It highlights distinct growth trajectories and obstacles encountered by startups, underlining their critical influence on employment and overall economic expansion.

KEYWORDS:  startups, growth, growth factors, high technology companies.

JEL classification:  O47, M13.