In the past 10 years, Estonia has developed its IT industry and infrastructure. Projects like e-Estonia, e-residency, and VR Estonia, among others, transformed the country into a fully digitalized hub in the Baltic region. 

The IT sector itself plays an important role in the Estonian economy, registering a $278,73 million turnover in 2025. Also, ~6.0% of the entire Estonian workforce is enrolled in the IT industry, for those 4800+ digital companies that export their services in 130 countries. 

Why Work With Estonian IT Companies

Essential e-solutions in Estonia that enable the digital society to function smoothly were all built by local Estonian companies. This enhances the reliability of Estonian IT companies not only locally but also worldwide - about this, we will relate a bit later. 

The already built digital system in Estonia already tells a lot about Estonian IT companies that perform excellently, and are becoming more and more attractive not only for companies but also for skilled professionals who are enjoying preferential conditions. 

So, after all, why should you work with Estonian IT companies?! 

• Skilled workers who provide high-level digital services.
• Open market - that facilitates and eases access to IT resources and companies' services.
• Low taxes - compared with other European countries, Estonia helps local IT and tech companies generate sales by cutting taxes, which can reflect a lower price/project for the end customer.
• Healthy business environment  - a well-established communication between businesses is assured.

What You Should Pay Attention to When Working With Estonian It Companies

However, working with Estonian IT companies can also be tricky. Even though the post soviet reminiscences are not visible, you still can hit Russian Estonians that are providing the same IT services, but of a relatively lower quality, and in a very specific manner. Roughly, some of the companies are only benefiting from the developed IT environment in Estonia, but don’t follow the same guidelines as the vast majority of companies do. 

Another challenge is the limited human resources that Estonian companies have. The country’s population is just above 1.3 million people, and 6% of it is simply not enough to cover all market demands, so it would be difficult to find an available IT company based in Estonia to take on a big project or so. 

How Developed is the Estonian IT infrastructure

Estonia ranks among the top European countries with the highest IT infrastructure. As mentioned previously, its digital transformation made the country one of the regional innovation leaders. But even so, the country is still not done yet with developing its IT capabilities. 

How Does the Estonian IT Industry Perform Compared to the Neighboring Countries?

In the Baltics, Estonia is a detached leader in IT. Latvia and Lithuania are behind simply because they have focused on developing other sectors. But the Estonian performance is also motivated by people’s attachment to digital technologies. The continuously growing number of digital agencies confirms once again that Estonia ranks better than neighboring countries. 

But speaking about Estonia as an extension to Europe’s northern region, the country is in tight competition with Sweden and Finland, which also find themselves somewhere in the first half of the European IT community.

Compared to those two countries, Estonian companies will rather provide lower prices for their IT and digital services and products, but at the same time, Estonia has way more limited resources than Sweden or Finland. 

All in all, Estonia is a great country to consider for digital projects, and local companies' rich experience with digital transformation can make a difference for their projects.