How To Properly Support Startups: Lessons From Estonia

Added: 2026-05-27

[00:00:00]Eid Mubarak from uh Estonia. And here, we're having conversations around the tech environment, founding a business, growing a business, and the kind of support that you require around the entire ecosystem, and even from the government, so that your business can grow to become as big as those ones that we've seen here in Estonia. There are very many that have grown to become unicorns, major companies. I've met up with a Kenyan entrepreneur in the tech space, uh Frank Abna. Frank, thank you very much for speaking to us. Thank you for having me. Now, what kind of business are you involved in, and where is it?

[00:00:33]Uh we are involved in uh we basically we are called uh Nana Sasa, which is an AI-powered communications platform. It's uh based in Kenya, Nairobi, Kenya, but we also do have a presence in uh Estonia. Okay. So, walk me through that journey of At what point did the idea come from your head to starting to implement? Where were you? Were you in Kenya or were you outside of the country? All right. Uh so, for for the Going back, going back to when you started business, uh been in business for over the past uh 10 years or so. And uh in business, we've uh we've been doing different types of uh businesses, basically within the IT space. That is from our payment systems, our VAS solution, bespoke software, and so on and so forth.

[00:01:17]Uh however, over from around uh 2024, that's about 2 3 years ago, uh we were having some discussions with uh actually somebody from uh Finland, who was actually my client, who ended up being my client, and we were discussing about different uh business environment, uh basically all over the world.

[00:01:34]And uh he planted the idea in our mind about how easy it is to uh set up business in this side of town.

[00:01:42]And uh we're trying to look at the pros and cons, or maybe reasons as to why maybe somebody would decide to explore a business maybe somewhere else besides Kenya. And I know for a fact most Kenyans they look at the fact that uh if I'm to consider setting up a business somewhere else, what will be the logistics? Uh most of the time they think about the logistical nightmare behind setting up a business. Maybe one needing to be there physically. And maybe two, and I think we look at it from the point of view that we are used to as Kenyans. Being uh we need to submit documents physically. We need to go there physically and so on. However, when uh when this friend uh shared about uh Estonia, and they mentioned that uh at that time it was 98% of the government services were available online. And uh we got into it. And that's when we searched up Estonia, uh e-residency in Estonia. And uh we were able to start the process. And uh uh good to say we were able to complete the registration process within 30 minutes of setup. I want to pause you before we come actually into the e-residency.

[00:02:42]Walk me back in Kenya. You're running your business in Kenya for over 10 years.

[00:02:47]Um how easy, how difficult is it for a startup to come up in the in in Kenya?

[00:02:53]Like what are the kind of hurdles that you have to jump through and through?

[00:02:57]Okay. I think I will uh outright say one of the key challenges that uh our business is because for myself I I just got into business when I was right out of a campus.

[00:03:07]And uh firstly, in terms of cost. The cost that you incur when you're setting up a business are quite high.

[00:03:14]And uh that is firstly on in terms of registration cost. And uh these are now from capital expenditure and operational expenditure cost. So, from capital expenditure now, one, the cost that you need maybe not to set up like a limited company. And uh two, uh when you're looking into things like uh operations now for you to be compliant, we have the normal uh taxes. Whereby we have uh the corporate tax, we have the income tax, we have the VAT, we have the PAYE. We have uh the NHIF and NSSF and so on and so forth. And uh over time from uh the past 10 years to date, I think they've kept on increasing.

[00:03:49]And this has made it a bit difficult for for a small business or maybe somebody just out of school to be able to come and set up a business and run them and run them in an effective manner. So, you're in school, you've come up with an idea and you want to start a business, right? Um and you had to go and register it. So, registration Did you register it in the era of brs.go.ke or did you register it in the era of actually working with hard copy papers?

[00:04:14]>> Yes, yes, I did so in the era of hard copy papers. Yeah, so you can imagine and that's Actually, let's just say despite all the challenges that we have as a country, we should acknowledge and appreciate the fact that we've come from far up to where we are as e-citizen.

[00:04:29]It used to be crazier because we used to have you compile your get your MOU memorandum articles document and all those other documents. You go to registry, you find maybe you need to have a contact there to help you accelerate the process and all that. So, you find that before you're able to register a company, maybe it used to take up sometimes even even like a month or even more than that if you don't have the documents at hand. So, it used to be very very manual and the yes, right now we do appreciate the fact that we've been able to streamline some of those processes up to where we are right now.

[00:04:59]Okay. The other thing that you needed after you came out of the registration office is you also needed to register it for tax. So, you go to Times Tower again to register it for tax, right? Okay, after the registration for tax, did you think that this is it now, I can start my business? Yeah, true. Actually, and that's also Could you raise that because that is one of our the challenges that we have as as as a country because at that point you think that okay, the fact that I've done registered my tax, I think that's it.

[00:05:30]And at that time because you're from a tech background, you're not that familiar with things to do with accounting, you're not familiar with things to do with HR and so on. It means that you have these gaps in existence and these gaps are going to come back and bite you in future. [laughter] Uh because you need to you need to we need to understand how like the the HR policy, how HR policy works as a country. You need to be familiar with accounting accounting practices as a country. And now generally basically all these integrity that are needed for you to be able to run a business, you need to be familiar with how they run. So on my end as far you think that the fact that yes, you have a company registered and uh one you don't even know that you're supposed to be filing returns on a monthly basis if it's a VAT company. You're not aware.

[00:06:14]And so but we were able to catch up with these as time went.

[00:06:19]Yeah. Is there an ecosystem in Kenya or a place where you can just plug in for this kind of information? Like so you're a startup, you're just a young man who's come out of university and you have an idea and you're starting.

[00:06:32]Um is is there anywhere a portal that you today you can go to that gives you information or breakdown of these are the things that you require today and these are the places that you can get this kind of support.

[00:06:44]Okay. At the moment not not the way you put it, but we have uh we have for you to be able to set up like a business maybe from tech. We have what they call like a tech incubators.

[00:06:58]And the tech incubators they simply help you maybe get your idea off the ground.

[00:07:02]Maybe for instance if you're looking to build like a like a financial application maybe in the fintech space, we able to help you maybe help you with things like product market fit, help you go to market and so on those kind of things. But in terms of uh these other integrity from operational standpoint whereby they are actually important for you to run a business, we don't necessarily have a one-stop shop that will help you with that. And those are some of the crippling things that hinder us or hinder small businesses in terms of going to market.

[00:07:33]We've I think I've seen one few private entities that have tried to consolidate such information, but it is not to a satisfactory level yet.

[00:07:41]And uh I think uh e-citizen to a certain extent right now is also trying to do that but I won't necessarily say it uh it has captured things to a satisfactory level. Basically, for somebody who's right out of school or even still in school who's looking to to set up a business. How about funding?

[00:07:59]Is there any kind of ecosystem that helps you to know that this is these are my options for securing funding for my business? As a founder, I want to get you I I know those terminologies that you guys use series A, series B, whatever. Right? Is there any kind of information place that can give you that information? You're at this age stage so you need a series A funding. You get to this level so you need a series B funding and these are the sources of the funds.

[00:08:26]Also, not not precisely. What you have is also I think we've seen initiatives from the private sector. I think the likes of Safaricom and uh yeah, KCB. I think they've done over the last few years they've been doing like some initiatives. I think we have I think KCB's called I think the Simba something and the sparks later programs.

[00:08:45]I think they've been trying to do those initiatives for us to help our businesses to uh in terms of getting access to funding and so on and so forth. So, it's also it's not necessarily in um I'll put it in a public domain to a certain extent because they're in the private sector and they have their own strict requirements and so on before you are able to be able to even qualify for one. So, it is not is not that of a straightforward process as well still. So, meaning for one looking for funding, you may still have to bootstrap for quite a while uh before you're able to get access to that.

[00:09:22]You know, one of the other things that I'm thinking of is um you know, here is Frank who has started a business and they have brilliant ideas about how this thing can go to market.

[00:09:32]Right? But you are a tech you're a developer.

[00:09:35]You need some you need to have some certain skills in going to the market and approaching the market. Did you have that at the beginning or did you just have to try sex your way into the market?

[00:09:44]>> Yeah, they call it baptism by fire. Cuz at that time actually you're wearing multiple hats, you're running HR, you're running administration, you're running finance, you're doing business development and all that. And some of these are not necessarily areas that are in your background. But when you keep on doing them, you keep on familiarizing yourself with the some of the best practices that are in HR, in accounting, in finance, sales and so on.

[00:10:07]Because at that time what you're really interested in is closing sales. And that means when you're closing sales, it means that you're able you you're likely to drop some balls in some other crucial components of running a business. So at that time you you most of the time the training that you have to do is basically on the ground.

[00:10:25]And if you're lucky, you may be able to get they call it You're able to get I can't remember the term.

[00:10:35]People who are able to mentor you.

[00:10:36]Actually, they call them mentors. So mentor mentors are able to help you with that. They're basically able to hold your hand. But if you're not lucky, yes, baptism by fire it is. Swim with the sharks. If you're lucky, you survive. If you're not lucky, you're eaten. And that's that's it. Now, let's go back into when you registered a company and now I want you to give me these comparisons with this friend who told you about registering a company.

[00:10:59]Friend from Finland but told you about registering a company in this region and you came to Estonia to do that, okay?

[00:11:04]Now, how long did it take you to register your company in Kenya from the point of thinking of the company and getting your first application in to the point of now being fully compliant? You have a registration certificate, you've got your PIN certificate and everything that you need. How long in terms of time? Wow. I think it's been it's been more than I think 10 10 years or so. So I would You're still you're still you're still complying. You're still >> [laughter] >> Yeah. So, uh over that duration, I think I will say I think it took about I think it took more than a month.

[00:11:39]More than a month for you to have uh maybe like uh your your your your your registration done, your NSSF, NHIF, your compliance, and so on. Because you don't even know where to start from in the first place. So, uh give or take, I think I will say timeless amount of time. It used to be like more than a month.

[00:11:55]Yeah. Then, let's come to Estonia. So, Estonia has uh this fame of being a very digital uh place that is very friendly to startups, is friendly to starting a business. Tell us about your e-residency and why you opted to go for that one.

[00:12:12]All right. So, uh for e-residency, what we had in mind was uh also trying to think about the logistics of uh going to another market to set up a company. And as I mentioned earlier, the fact that you're looking at it from the lens of what you're used to in Kenya.

[00:12:25]The fact that you need to have like the same physical or manual documents to go to any uh to go to government entity for you to do the registration and all that.

[00:12:33]Uh however, when we came to find out about uh e-residency, we could see that uh this is just about uh you go online as long as you have uh the required documents. And most of the required documents are just pretty much more or less the same documents that you have in our country that are required. And uh within a 30-minute session and about 2 or 300 euros later, you have a company ready.

[00:12:56]So, it was that It was that simple. And uh I think I've had like other guys discussing like uh what what what have been some of the most amazing stories about how you set up your company.

[00:13:05]Somebody's like, "I was able to set up my company while I was on transit to from point A to point B." And all that.

[00:13:11]So, you can uh with that, you can you can picture the simplicity about uh you know, that process.

[00:13:16]What do they give you? Do they give you a registration certificate?

[00:13:19]Another KRA certificate? Another NHIF, NSSF? What do they give you? So, for them, they give you they give you a code. and this is uh pretty much it's more like an uh call it an identification code, which is also linked to some of these other essential services that you're going to use. So, this same code is going to be linked to your if you're doing your accounting and the the HR modules and so on and so forth. Basically, it's just the same code that is going to be used across different different platforms that you're going to be interacting with. And also, once the registration is done, the next thing is for e-scholar a residency e-residency card for it to be sent to you. And that is what takes like about 3 to 8 weeks before card is able to be sent to you. And what what what used to happen like back to and it still happens right now is uh the card is normally sent to the different Estonian consulates. And the closest one they used to have one in South Africa. I don't I'm not sure what happened there. But the rest were in the Abu Dhabi, the Singapore, and so on and so forth. So, once you have your company registered, the next step is getting a e-residency card. And with this e-residency card is a card that you use now for you to be able to access now the the respective government services.

[00:14:35]Yeah.

[00:14:36]Do you have the e-residency card with you?

[00:14:39]Okay. It's okay. But just walk us through it. So, once you get this card, how do you use the card to transact with government, to transact with opening a bank account? Is it that you have to slot it into your computer? Or and how do you do that? Yeah. So, the card the card is pretty much comes with a USB stick. So, with a USB stick you're able to attach it to the card. And now you simply attach it to your computer. So, with that now you go to the respective government portal, which is I think e-resident dot ee. And with that now you're able to to activate and key in cuz the card comes with your respective PIN and so on. So, with that that is the secure authentication method that they get to use for you to be able to access their their respective services. So, your company is now registered in Estonia.

[00:15:27]Uh what advantages do you get with that?

[00:15:31]They come with a myriad of advantages, and one thing I will say for a fact is something like I'll start with the taxation.

[00:15:39]Uh cuz with tax for them, they they have like a 0% corporate tax. Uh on our end, we are at 30%. And uh for tax, they don't get tax as long as you reinvest funds into the company.

[00:15:53]Uh whether you are looking into things like growth, increasing in growth or operations, and so on, they don't get to they don't get to tax that. And I will say that that has really helped like start the economy, or rather grow such that is the reason as to why we have like about 10 unicorns. That is the reason as to why Estonia is like I think also top 10 in terms of the GDP per capita, and so on. Because they don't get to tax uh they don't get to tax they mostly look into For us, as Kenya will say that we do we do we do immediate taxation for the immediate expenses, but for for the our ecosystem for sorry for this Estonia ecosystem, they do uh help you reinvest for growth and expansion.

[00:16:33]And that key difference has really really helped our business to think on this side. So, for for us, when you're looking to come to Europe, it means that we are trying to see what can be favorable. You see if uh in addition to sub taxes, getting access to the European market better part of the EU market, whereby you can meet investors and so on. So, for you to meet and interact with investors, some investors are very comfortable working with a with an entity that from a regist from a well-recognized region like Estonia. Compared to for instance, if I come in if I come in as a Kenyan entity vis-à-vis coming in as an Estonian entity, uh some accelerator some investors or some partners are comfortable working with you as a as an Estonian entity because they know and they believe and they do trust in the system that has been put in place in Estonia.

[00:17:26]So, that means also for us for us as Kenya we've we've made good strides on that we've made good strides in terms of doing this digitization and so on. But, one key element that I think we need to work with is the element of trust.

[00:17:42]So, that you can have not only investors, but also us as residents be be able to trust our systems and be very confident in our systems. And with that it means something like in terms of data protection who who has access to your data how often is it data accessed because at times you find that we've had cases whereby people have access to information about yourself and you don't know how they How they got it? How they got it. So, and I will say like in in Estonia they have what they call the X-Road.

[00:18:12]The X-Road is is a platform that has unified them the private in the public public service all in a single platform whereby you have things like health your bank health, bank, police services immigration services all accessed under single platform. And this doesn't necessarily mean that it is in a centralized location because it is decentralized, but the respective the respective entities that want to access any of this information, they simply just query them.

[00:18:44]And with that you're able to log and see Eric was trying to access my police clearance.

[00:18:51]And Eric can tell us why do you need my police clearance information?

[00:18:55]So all that all that as the fact that it's it has been consolidated into a single platform, it makes it easier even for the residents and and actually that is one of the reasons why they say Estonia is one of the highly digitized economies.

[00:19:08]Because they don't you don't need to they have what they call like a one, I think the one of principle they mentioned. So, with this one of principle, it means that you only get to submit information that doesn't change about, you only get to submit it once.

[00:19:22]That is, your ID doesn't change.

[00:19:25]Your KRA PIN doesn't change.

[00:19:28]Uh and you have maybe like your PIN number, you have some documents about yourself that don't really change. So, it doesn't really make sense every time you need to place an application or you need to do, you know, one, two, three, you need to keep on providing those manual documentation. So, those are the areas that I believe that we need to look at because you already have the infrastructure already, I think partially ready because we've been for Kenya, we've been I think we we are we are commerce first.

[00:19:54]Like other countries, for instance, Estonia, I think they they started digitizing the government services faster.

[00:19:59]Uh but for somewhere like Estonia, they went to, sorry, Estonia went to digitize the government services first, but for us as Kenya, we went to finance.

[00:20:10]We're financially we we took the first approach towards financial inclusion and so on. That's why we have things like, you know, the mobile money and so on and so forth. And if you're riding on that backbone, it means that it's also very easy for us to be able to uh be able to have to to ride on that platform to be able to, you know, digitize things and centralize them or be able to have them within a single access location and all that.

[00:20:34]Frank. Thank you very much for sharing your story with us and I mean, there's a lesson that we have to take as a country and we have to continue having these conversations so that we as we say we are fixing our nation.

[00:20:46]These are the areas that we need to fix.

[00:20:47]We've got to identify the areas that we fix as a country and in when it comes to tech and entrepreneurship in the country, these are the areas that we need to fix. How do we create a system that is trustworthy to everybody? The users and even people who are not direct users, how do they know that the system is trustworthy?

[00:21:06]How do you get the e-citizen platform which is working very well to a level where everybody just feels comfortable using it? How do we get then the e-citizen to read all day, to link up with all the others with the, you know, that security of your data and and making sure that it works. Sure. I think there's another key thing that I would want to highlight with with e-citizen, sorry, with the e-residency.

[00:21:29]They have once you're registered and you are on the on board it on the platform, they have what they call a marketplace.

[00:21:35]And with this marketplace, you have access to accredited institutions across different industries, whether it is you know, the HR, finance, tech and so on and so forth. That means for anybody new, for even myself, I can simply go to that marketplace. If I need anything to do with say accounting or marketing or whatever it is, I should be able to get like a vendor from that platform. For instance, like our sales, the fact that we deal with the AI-powered communication platforms, uh and we'd want people to be able to get that information. So, once we're able to uh get ourselves into that marketplace, it means that any other partner coming to, whether it is Estonia, they should be able to get access and see, "Okay, I think this person is pretty much in the industry that I'm interested in." And they should be able just to get to be able to reach out to you like that. So, imagine in Kenya, if we have something of that sort in e-citizen whereby now you have our own marketplace.

[00:22:31]Cuz we have very talented, we have very skilled workers in the country. So, if we have of course, we have if you as long as a company has been accredited by maybe you have the relevant certification, if it's things like a CAK, if it's ICT accreditation and all that, you have that and you and you've been put in a certain marketplace, that means anybody from the private or the public sector, if they want to partner with you, they can simply be able to get access to you from that single platform.

[00:22:59]So, those are some of the things that I think if we take that approach, it will really help our business and our young people in terms of not only creation of employment, but what is equally of most importance is in terms of we're trying to help in terms of revenue generation and all that. And at the end of the day, help of fixing the nation. That's how we fix the nation. Frank Obegi, thank you very much. Thank you very much for this.

[00:23:20]All the best. This is a future tech billionaire. We see him at this particular stage. Tech entrepreneur Frank Obegi who has a business in Kenya has now registered an e-residency for his business here in Estonia. He's able then to access easier a bigger market in Europe and because there's some trust on the system. He's been sharing with us that experience.

[00:23:41]Fixing the nation one conversation at a time. Keep it here for more coming up shortly.