How Estonia is incubating the city of the future, inviting digital nomads to make roots

Nicole Tan, a 29-year-old content marketer from Singapore, has visited enough places in the last year to make an Instagram follower weep: Jamaica, Miami, Portland, San Francisco, Los Angeles, Budapest, Slovenia, Berlin, Luxembourg, Iceland, Romania, Poland, Paris, Amsterdam and Thailand. In almost all of those places, her working life has continued as usual. “Last year, I was moving every other week, or almost every couple of days,” she says. “Time to go, time to go. I had to be at places.” Digital nomads create a win-win in quest for work-life balance Tan is one of a growing number of “location-independent workers”, or digital nomads. Like many of them, she often has to fly under the radar because governments do not recognise the way she works. She and thousands of other nomads can travel on a tourist visa or work for a local company, but – though governments often turn a blind eye – it is technically illegal for them to work remotely. But, in one city at least, that will not be the case for long. I meet Tan at Lift99, a co-working space in Tallinn, the capital city of Estonia. The facility is part of Telliskivi Creative City, a hive of colour and enterprise near the main railway station. Once home to an electronics factory, the complex now hosts 250 companies, eight restaurants and an arcade of independent shops. There are table-tennis tables. There is a flea market. There is a mural showing a skeleton photo-bombing a hipster’s selfie (a parody of Bernt Notke’s painting Danse Macabre, which is a major tourist draw in nearby St Nicholas’ Church). Estonia’s ‘e-residency’ giving businesses fearing ‘hard Brexit’ upheaval the EU loophole they’ve been looking for Estonia has just announced the first official visa for digital nomads. The permit will entitle such people to 365 days of working in Estonia, including 90 days’ travel in the Schengen area of the European Union (EU). Since EU citizens can already move and work freely, it is aimed at people from further afield: from the United States, Asia and Latin America. It will be launched in January 2019. “I think it’s great,” says Tan. “It’s about time we had something like this.” Famously, Estonia is the state where everything happens online:internet access is enshrined as a basic human right; seven-year-olds are taught to code; and citizens can vote, secure mortgages and open bank accounts via the second-fastest public Wi-fi in the world. You can open a business in 10 minutes without leaving your cafe table. It is also a nation entranced by the power of start-ups, where there is a revolving door between the tech scene and government. As a result, the vaunting utopianism of its digital gurus often finds its way into policy. Borders are not the reflection of policy and politicians. They are the reflection of the borders in our heads Karoli Hindriks, chief executive, Jobbatical In case you have not heard (and you will if you visit), Tallinn is the birthplace of Skype, whose phenomenal success in the early 2000s was built around a core of work by Estonian developers. It showed the youth of this wintry, former-Soviet state that great things were possible. “It almost feels like start-ups have taken over the city,” says Norris Koppel, chief executive of banking app Monese. The wall at Lift99 features an #EstonianMafia Wall of Fame, which lists firms that have hit US$5 million in investment: Pipedrive, TransferWise, Funderbeam, Taxify … And a start-up will spearhead the digital-nomad visa: Jobbatical, which encourages businesses to cast their recruitment nets wider than usual. In the company’s office, which occupies a converted block of flats in Tallinn’s formerly industrial Kalamaja district, amid beanbags, bowls of confectionery and motivational wall slogans (“Don’t wait to be asked”; “Go beyond yourself”), the staff of 39 – drawn from 15 nationalities – work to link roving digital workers with employers across the globe. Lessons to be learned from tiny Estonia Jobbatical’s founder and chief executive, Karoli Hindriks, first discussed a digital nomad visa with Estonia’s youthful president, Kersti Kaljulaid, more than a year ago, and harbours a bold dream of a future without national boundaries. “Borders are not the reflection of policy and politicians,” Hindriks said in a Ted talk delivered late last year. “They are the reflection of the borders in our heads. They are the borders that keep us from pursuing our dreams … You, me, us – we are the border guards of our lives.” Killu Vantsi, legal migration adviser at the Estonian Ministry of the Interior, has the more mundane task of removing the diplomatic clouds from this blue-sky vision. “To be honest, the workforce in the globalised world is very mobile,” she says. “The rules for visas and work permits are based on the classic work situation, where you live and work in one place, but the rules have not gone together with developments in the work field. So it’s time, we think.” Roving trade, you could say, is in Tallinn’s blood. In the 850 years since it was first marked on a map by an Arab geographer, the city has played host to merchants of every stripe, drawn to its coastal position linking Europe and Russia. Since the 12th century, it has been conquered by Swedish and German armies. Russia has occupied it three times, for a total of 250 years. Drinking in the sights and sounds of Tallinn and Helsinki The last time the Soviets rolled in, in fact, they stayed for most of the 20th century. So, after gaining independence in 1991, Estonia fought its way out of the resulting slump by turning to the West – and by investing heavily in digital infrastructure. Its much-publicised e-residency scheme, launched in 2014, offers citizens everywhere access to its online platforms without them having to actually live in the country. E-residents can start a business, process payments and sign documents online, just like ordinary Estonians. It is clear that Tallinn wants to court a specific type of person: the world’s laptop-wielding transnationals. Even the job title given to e-residency’s head marketer smacks of Silicon Valley: “chief evangelist”. People say e-residency is trying to change the world. We say no, the world has already changed. We’re trying to catch up Adam Rang, “chief evangelist” for Estonia’s e-residency scheme “It’s something a lot of tech companies have,” says Adam Rang, who holds the post. “We like to think of ourselves as a government start-up.” His pitch is certainly well-polished. “People say e-residency is trying to change the world. We say no, the world has already changed. We’re trying to catch up,” he tells me at Tallinn Creative Hub. Formerly the Tallinn City Central Power Station, this brooding industrial monolith was used by Russian auteur Andrei Tarkovsky in his 1979 film Stalker. “We made sure Estonians can do everything online – long before digital nomads were even a thing,” says Rang. “So it makes sense that, if we’ve got those opportunities, we should offer them to non-Estonians as well.” The programme initially set the grandiose aim of 10 million “digital citizens” by 2025. It currently has 40,000, and has revised its target to 20,000 e-residency companies by 2021. Meanwhile, it is pushing ahead with a LinkedIn-style social network and an app, to be launched this summer. Officially, e-residency is not a route to full residency, but “there is a path”, Rang says. “Once e-residents travel here and start doing business with Estonian companies, it becomes very easy to take the step to live here as well.” The millennials who get their brainwaves on the ocean waves – their office is a luxury yacht cruising the Med In November, the number of monthly applications exceeded the country’s birth rate. At a time when Estonia needs to attract 440,000 immigrants just to retain its current population size of 1.3 million, e-residency and the digital nomad visa could be seen as clever border policy: with 65 million citizens going spare in the age of migration, it is a diplomatic sleight of hand to select the digitally savvy among them. In fact, you could argue that one aim is to reduce Russia’s influence by loading the city with Western entrepreneurs. Tallinn remains home to many Russian-speaking Estonians, left over from the industrial immigrants shipped over to labour in huge Soviet factories. Large numbers live in gloomy, brutalist blocks in areas that are a byword for social problems, such as in deprived Lasnamäe district. Though Russian-speakers make up 36 per cent of the city’s population, the distrust they face from ethnic Estonians has been slow to subside. Young Russian-Estonians are twice as likely to be unemployed, while Russian schools in Tallinn have been refused the right to teach ethnic Russians in their own language. Government officials like e-residency because they have something to speak about when they visit their colleagues abroad. But it is almost impossible to understand what Estonia really gains from it Lawyer Sten Luiga Memory here is long. Just 30 seconds’ walk from where Vantsi and her team fine-tune the country’s borderless visions are the underground cells at Pagari 1, where Estonian nationalists were interrogated by the KGB. “I don’t know an Estonian person who doesn’t have a story of somebody in their family being directly affected by being killed or being tortured, so it’s pretty raw,” says Daniel James Coll, a British Lasnamäe resident who recently ran for local government on a platform of improving infrastructure and healing divisions. The city reflects this continuing mistrust. “You go to parts of Tallinn and you’ll see places that are as managed and well-kept as the best part of smaller English towns,” says Coll. “And then you come here, and you’ll see that these crossovers are falling apart, and there’s no signage on the roads, no lines on the roads. The government just don’t bother putting money into it. It happens on every level.” Estonia expels Russian diplomats as army joins Nato drills Meanwhile, cracks are forming in the digital facade. The country’s top banks have been closing the accounts of e-residents en masse, triggered by a wave of money-laundering accusations in the Baltics. On Facebook forums, debates multiply about where exactly e-residents are taxed and what the scheme entitles them to. “Right now, we’re a bit like savages,” says business lawyer Sten Luiga. “We just offer something, without knowing what the consequences might be. Government officials like e-residency because they have something to speak about when they visit their colleagues abroad. But it is almost impossible to understand what Estonia really gains from it. And people are becoming sceptical because there are no answers.” Luiga is concerned that upscaling the project so rapidly makes it hard for Tallinn’s banking and legal communities to anticipate the risks. “The programme has been run as a start-up because our government is young and enthusiastic, so they try to impress,” he says. “However, the government – a responsible government – can’t act in the way that start-ups act. Nine out of 10 start-ups don’t fly. You can’t shut down the only government we have because it didn’t fly.” Even more scathing about the state’s e-topian vision of a “borderless digital nation” is Dario Cavegn, a Swiss journalist at ERR, the Estonian national broadcaster. He scribbles on a piece of paper in the office’s cafeteria to show how it easy it would be for e-residents to move money out of the country through loans, default on their debts, and open another company within minutes. “You don’t know what people are using this kind of set-up for,” Cavegn says. “You have no idea. The government provides a legal framework, but they haven’t taken into consideration what happens once a system like that is freely available.” How digital nomads can make the most of a mobile office space, by a thrifty traveller In other words, it’s classic start-up behaviour. With a start-up, you develop a “minimum viable product”, Cavegn says, and go to market as soon as you can in a bid to attract buzz. “It’s like these guys don’t realise the real-life implications of what they’re doing, and that nothing is actually quite that simple.” He chuckles. “I would really like to know: if e-residency is so important and if everybody’s been waiting for this, where are the masses that were supposed to come kicking down our door? Where the hell are all these people?” Even the sceptics seem to agree that Tallinn is on the right track, though. The city’s youth are broadly excited about the tech scene, which they consider Estonia’s best chance of prosperity; the country’s movers and shakers are young, energetic and full of ideas (Estonia’s prime minister is 39; its president is 48). “Estonia had 20-odd years of independence before the second world war and the Soviet occupation, and then the utter omnishambles the place was after 1991, and they pulled themselves out of it by the boot straps,” Cavegn says. “The whole digital thing was a lifeline.” Estonia had 20-odd years of independence before the second world war and the Soviet occupation, and then the utter omnishambles the place was after 1991, and they pulled themselves out of it by the boot straps. The whole digital thing was a lifeline Dario Cavegn, journalist at ERR, the Estonian national broadcaster It is also clearly true that more people could work remotely than currently do. A survey conducted last year by human resources company Randstad found that 56 per cent of Hong Kong people were willing to move abroad for work, higher than the global average of 50 per cent. This was particularly true of the city’s youngsters: 60 per cent of respondents aged between 18 and 34 said they were willing to head overseas to further their careers. Out of its post-Soviet ruin, Tallinn has rebuilt itself as a borderless digital city of the future, moving with a speed and flexibility that older bureaucracies lack. It is a place where ideas progress smoothly – sometimes too smoothly – and which is cleverly positioned to attract the wandering digital workers who are predicted to number a billion by 2035. Tech idealism and state government are not natural bedfellows, however. Start-ups run on a rhetoric of irrational daring: if you can dream it, you can do it. Governments, on the other hand, have to work responsibly to protect every member of society. For all its advances, Estonia still struggles with the worst income inequality in Europe. Similarly, it is a grand aim to conjure up a digital nomad hot spot from scratch. Tallinn has a long way to go before it catches global magnets such as Medellín in Colombia, or Chiang Mai in Thailand, where the coconut cocktails are on tap and the sun rarely stays hidden. In the Estonian capital on the day the new visa was announced, it was minus 11 degrees Celsius. But the culture here is of a shoot-for-the-moon optimism. “The streetlamps might be rusty and the roads might not be quite right, but what they are planning to do is running,” says Coll. “And they’re just going to keep going until it works.” Guardian News & Media

How Estonia is incubating the city of the future, inviting digital nomads to make roots

Special visas and cutting-edge digital infrastructure are making Tallinn a global hot spot for location-free workers