Setting up business in Latvia

This week, Business Planet is in Riga, the capital of Latvia, a country which suffered heavily from the global crisis.

However, the economy is taking off again, and growth is expected to reach 4 to 5 percent next year. This is in part thanks to a business boom in recent years.

Twenty-eight year old Gintz Ziverts is one of Latvia’s success stories.

After spending ten years in South-East Asia and Thailand, he decided to open Latvia’s first Thai restaurant.

It was an instant success.

Today, Gintz employs seven people and makes twice as much as he had expected. He is thinking of opening up other Thai restaurants in Riga.

“I was living in Bangkok, and I saw all the food and thought that this type of food and this way of living were missing in Latvia,” says Gintz.

“So I got the idea of opening a Thai restaurant in Latvia, simple food at simple prices, accessible to everyone. But it was new in Latvia, and this was a bit difficult to explain to investors.”

But in the end, Gintz did manage to convince investors.

He got a 65.000 euro loan as well as 10.000 euros in subsidies. It was part of a European Social Fund partnership programme called New Start, aimed at helping 25-40 year olds set up their own businesses.

The programme also provided Gintz with an accounts training course.

“Through this course in accounting, I learnt how to manage my funds,” says Gintz.

“I learnt how to hire workers in Latvia, and the law behind all of it, how to do things, and what the downside can be.”

The European Social Fund is the European Union’s main instrument for supporting employment in member states, especially those suffering heavily from the crisis.

Introduced in Latvia in 2009, the New Start programme has made a real difference for young entrepreneurs.

“Under the New Start program, Latvia has created 700 new businesses and 1,300 new jobs,” says Inna Steinbuka, head of representation at the European Commission. “This is very impressive.”

Gintz has this advice for anyone thinking of setting up their own business:

“The main keys to success are : first, the idea. Second, hard work. And third, getting the funding. To get the funding, you must make your idea attractive for the investors.”