Copyright © 2017 The Authors. Published by VGTU Press. This is an open-access article distributed under the terms of the Creative Commons Attribution-NonCommercial 4.0 (CC BY-NC 4.0) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited. The material cannot be used for commercial purposes. Strenthening opportunitieS of economic relationS between lithuania and Sweden within the perSpective of it Startup company’S development Živilė TUNČIKIENĖ1, Gabrielė SINKEVIČIŪTĖ2 1Department of Social Economics and Management, Faculty of Business Management, Vilnius Gediminas Technical University, Saulėtekio av. 11, 10223, Vilnius, Lithuania 2Department of International Economics and Management, Faculty of Business Management, Vilnius Gediminas Technical University, Saulėtekio av. 11, 10223, Vilnius, Lithuania E-mails: 1zivile.tuncikiene@vgtu.lt (corresponding author); 2gabriele.sinkeviciute@stud.vgtu.lt Received 20 February 2017; accepted 11 April 2017 abstract. Cooperation with Sweden – one of the key priorities of Lithuania. Eco- nomic cooperation potential is promising. One of the priority areas of economic activity, in which Sweden invests in Lithuania, is information and communica- tion. In order to develop and utilize the potential for economic cooperation in the IT field, it is relevant to structuralize IT startup business success factors and to jointly develop base for decisions, execution of which would help ensure effective, economic co-operation development based with Sweden, beginning of IT startup business and such business’s continuity. To achieve the objective, following tasks were resolved: concepts of startup business and the startup company were puri- fied, specifics inconcept’s application in the context of the parties were defined; systematized the startup business success factors and ways of strengthening them, focusing on the factors relevant for strengthening economic ties between Lithu- ania and Sweden within the perspective of IT startup company’s development. Systematic method of research was applied. Keywords: startup, IT, Lithuania, Sweden, business success factors, opportunities of economic relations. JEL Classification: O3. 1. Introduction Cooperation with Sweden – one of the key priorities of Lithuania. Economic coopera- tion potential is promising. One of the priority areas of economic activity, in which Sweden invests in Lithuania is information and communication. In order to develop and utilize the potential for economic cooperation in the IT field, it is relevant to struc- turalize IT startup business success factors and to jointly develop base for decisions, execution of which would help ensure effective, economic co-operation development B u s i n e s s, Ma n ag e M e n t a n d e d u c at i o n ISSN 2029-7491 / eISSN 2029-6169 2017, 15(1): 57–76 doi:10.3846/bme.2017.357 https://doi.org/10.3846/bme.2017.357 58 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development based with Sweden, beginning of IT startup business and such business’s continuity. To achieve the objective, following tasks were resolved: concepts of startup business and the startup company were purified, specifics in concept’s application in the context of the parties were defined; systematized the startup business success factors and ways of strengthening them, focusing on the factors relevant for strengthening economic ties between Lithuania and Sweden within the perspective of IT startup company’s develop- ment. Systematic method of research was applied. Information Technology (IT) is regarded as the most important factor of globaliza- tion and technological progress, the base of the knowledge society. The IT sector has been, is and will be one of the fastest growing businesses in the world. According to the Lithuanian Statistics Department (LSD) records IT is one of the leading sectors of the Country in accordance with the growth of the added value. IT sector’s added value is increasing every year, which makes up about 3% of the gross added value. The overall growth of production of IT sector was and will be predominantly due to the result of newly established production companies of equipment for information and communica- tion technology. It should be noted that Lithuania has not exhausted all of the IT sector’s contribution to the country’s potential of the economic growth, which encourages the search for new, more unfulfilled areas, to note the areas of neighboring countries ahead of Lithuania and find ways to create competition in the global IT market. The development of IT sector is considered to be the general national or regional economic competitiveness determinants (Ogunsola 2005). For over a decade the world’s rapidly growing demand for the use of social networks for business, the internet to receive the news, e. tools to implement knowledge and etc., allow more and more entre- preneurs to successfully find new mediums in the IT sector: e-shops, business platforms, software that helps simplify daily operations and rationalize the use of limited resources, while increasing the productivity of enterprises. Therefore, the number of rapidly de- veloping high-tech startup based businesses is growing. According to public enterprise “Versli Lietuva” (Versli Lietuva 2015) statistics, over the last 5 years Lithuania created a noticeable startup company ecosystem, which currently consists of over 315 startup companies. Popular IT products (for example, mobile public transport and journey plan- ning application TRAFI, photo editing program Pixelmator) are created by small IT startup companies. Inspired by largest IT corporations like Apple, Microsoft, success stories, young entrepreneurs generate ideas and develop innovative products while look- ing for opportunities to become leading companies. Some of the IT startup companies, such as TRAFI, TransferGo, MoboFree, develop and grow into large, independently operating businesses. Others fail to overcome the competition and are forced to retreat. Obviously, the external and internal environmental factors lead to the development and destiny of IT startup companies. Lithuania is rapidly moving in the path of modern electronic economic development. One of the country’s most important economic activities – is striving to become a high- 59 Business, Management and Education, 2017, 15(1): 57–76 tech leader in the Baltic region. A noteworthy consideration of Foreigner legal situation act amendments done by The Lithuanian Parliament (LRS), foresees a simpler immi- gration for demanded non-EU startup professionals to Lithuania. Creators of the new technologies form the East are already interested in our Country, as they see Lithuania as a center for the development of globally competitive products. Growing foreigner startup companies’ attention to Lithuania is not accidental. As in the autumn of 2016, startup company incubator, with no regional analogue, called “Vilnius Tech Park” has been opened. The parks design concept provides the opportunity for Vilnius to become the Silicon Valley of the Eastern and Central Europe. The factors that determine the success of establishing a new business are widely studied by foreign scientists (Roure, Maidique 2002; Costa 2004; Sels, Vanhoutte 2005; Cheung et al. 2011; Ries 2012, Akram et al. 2011; Blank, Dorf 2012, etc.). Studies have existing diversity of factors and their impact on succession of IT startup companies. The rapidly growing interest in the startup business organization in Lithuania and elsewhere, as well as the business development opportunities, our research is oriented to develop a model of IT startup business development factors, based on results of analyzing suc- cessful cases of IT startup business, in order to strengthen bilateral economic relations. The objective of this study – is to structurize IT startup business success factors and to jointly develop the base for decisions, the implementation of which would help to ensure effective development based on economic co-operation with Sweden, the start and continuity of IT startup business. In order to achieve the objective, the following tasks are raised: – Referencing scientific articles and results of other sources’ examination, refine the startup business and Startup Company’s concept, the application of mentioned con- cept in the context of the State. – To systemize the startup business success factors and ways to strengthen them, focusing on the factors, relevant for strengthening Lithuania’s and Sweden’s eco- nomic ties within the perspective of IT Startup Company’s development. 2. Concept analysis of startup business The rapidly evolving society continually generates new ideas, to implement them new models of business are created. This is one of the most important reasons of public development, propulsion of the national economy’s development. The most relevant contemporary form of business organization – the startup. Discussions considering the subject of the startup business definition are noticeable, where acceptance of the dif- ferent opinions can be found. According to N. Patel (2011) the term startup is used to describe any newly established business. In Cambridge Dictionary of business startup “is a business that has just started” (Cambridge Business English Dictionary 2011). After the greatest twentieth century success stories of high-tech companies, such as Ap- ple, Google, Facebook, the term startup launched in use as a unique business concept. 60 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development According to P. Graham (Graham, Spaulding 2005), the main factor that distinguishes start- up from other business routine is its rapid growth. The author suggests a definition of a start- up: “Startup business is “modeled” for rapid growth. The mere fact that the business is newly established, does not mean that it is a startup. Startup business does not have to be based on high-tech or venture capital financing. The essence of this business – explosive growth”. According to the results of empirical research done by the “Nesta”, responsible for the promotion of innovation in the UK, “the startup” is “a young, innovative, growth-oriented business, that is looking for long-term sustainable business model” (Dee et al. 2015). Startup is an organization set up to look for unique and measurable business model (Blank, Dorf 2012). Thus, the term startup includes business, which is based on innovative advanced technologies combined with a sharp growth in the traditional business model elements. According to E. Ries (2012), startup is a newly established business, focusing on new products and services, which are based on the rapid high-tech development. In 2013 public enterprise’s “Versli Lietuva” annual survey (Versli Lietuva 2013), startup is as innovative and IT based business that create products built on high-tech and life science solutions. One of the most famous entrepreneurs of Silicon Valley S. Blank (Blank, Dorf 2012) as well as E. Ries (2012), exploring the concept of the startup business, agree with the common view that the most general sense of the startup business model should be based on innovation, advanced technologies and their transference. From a slightly exceeded time perspective, the startup should focus on the search for a sustainable business model and its application. According to S. Moon’s (2014) opinion, the startup – is a technological company that de- velops high added value products and realizes innovation in the market. D. Norris (2014) describes the startup companies as newly established companies that have a unique business idea and their principles of operation are based on the technology and/or innovation. Startup companies are defined in draft plan of Lithuania’s Entrepreneurship Action 2014−2020 m. This is a rapidly growing, young and potentially strong, directed to a single product devel- opment, high-tech-based, business. Swedish startup business as interpreted by P. Graham’s (Graham, Spaulding 2005) suggested concept which is expanded by understanding of the necessity requirement of innovative activity. In 2015 Sweden’s Ministry of Enterprise and Innovation conducted study “European Startup Monitor”, startup companies are considered to be businesses that are rapidly expanding and developing innovative activities. Startup companies – innovation-based initiatives. Obviously, this form of business has exceptional performance characteristics. Startup companies are often characterized by a concentration to the global markets. Such companies’ uniqueness and competitive advantage is created by innovation. This can be an innovative process, business model or function. One of the key features that separates the startup company from the traditional one – the nature of development. A typical business model of companies is characterized by a linear expan- sion, when the money is invested in the company itself, to its system (income, cash and jobs) (U.S. Bureau of Labor... 2014). Startup company grows in exponential rates: when the money is invested, positive influence is not experienced immediately. 61 Business, Management and Education, 2017, 15(1): 57–76 It is important to note that startup companies are often attributed to Venture Business (Jakubavičius et al. 2003). The base and driving force of such companies – the estab- lishment of scientific ideas, their development, and finally, their conversion into new technologies and products. For the most cases these entities are represented as small group of talented scientists, engineers, managers, united by a common goal – setting up innovation, its introduction avoiding bureaucratic restrictions that are common in large corporations, whose activities are based on a detailed action plan. Startup companies named advantage is flexibility, rapid change of direction when in search and applica- tion of new ideas, the ability to quickly adapt to market needs. Competitive pressure is forcing developers to work efficiently and expressively reach the final result. Regarding funding, these companies usually apply to large corporations, private equity, venture capital funds and also public institutions. Startup companies are also treated as a way to transfer high technologies, adapting them to specific needs. Methods of transferring the technology related to a present sub- ject are distinguished (Kraujelytė, Petrauskas 2007): – Spin-off company is a newly established company, which founding initiative came from individuals who were employees in other, major company. It arose due to the transfer of technologies. Typically, a spin-off company is created together with the newly transferred technology and its provided innovation (Rogers et al. 2003). – Startup company is similar to a spin-off, only the name of the startup defines a newly created company rather than a part that span-off from the main organization. As a result, the term startup often characterizes an innovative, high-technology- oriented company, to establishment of which there was direct impute contributed by scientists using scientific research, knowledge and technologies generated and created in the institutions of the technological development. According to the analysis of startup concept, it can be said that the startup business model is based on high-tech transmission, therefore innovative business solutions that created products are based on, the use of which promote the development of the knowl- edge society; the other feature of this business model – the startup business model is based on external funding. Similarities of Lithuanian and Swedish approaches to the startup business concept are treated as favorable assumptions (business cultures of con- tact points) on strengthening the bilateral economic relations through the perspective of startup company’s development. 3. The picture of Lithuanian and Swedish startup companies during the years of 2013−2016 In today’s society, number of people who are interested in opportunities to build a business based on high-tech and innovative solutions, is rapidly growing. According to the results of world’s entrepreneurship index, Sweden is in the 5th, Lithuania – in 26th place. There is no shortage of good practice examples in Lithuania and Sweden: the 62 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development usage of Swedish startup company’s Spotify mobile application contributed to the music industry’s recovery and growth by reducing piracy (Hammarberg et al. 2016). Lithu- ania’s startup company TransferGo has developed a new financial transaction platform to eliminate international transfers carried out at a bank, thus avoiding complicated form filling, large service fees and hidden charges. More and more attention is dedicated to the development of startup ecosystem or creation of business communities, which are united by a passion for high-technology enhanced business. Sweden’s and Lithuania’s startup companies refute the stereotype that the majority of startup companies are based on the mobile application development. Ac- cording to public enterprise “Versli Lietuva” annual review of the Lithuania’s startup ecosystem conducted in 2013 (Versli Lietuva 2013), in Lithuania the startup created inno- vative solutions based on high technology and performed a wide range of activities: from development of the software to the world’s most popular operating systems (Windows, iOS), computer games to effective financial services solutions and social networking. In 2016 Lithuania’s startup companies offered new products and services to aviation, bio- technology, life sciences, 3D printing, transport and logistics, fields of energetic activity (public enterprise “Versli Lietuva” 2016). Most of the Swedish startup companies offered financial, wellness, e-commerce and media services (SUP46 2015). In 2013 Lithuania’s startup ecosystem consisted of 191 startup companies, which in the period of 2007−2012 attracted a total of 34 million euros of investments, in 2013 the com- pany GetJar managed to attract very large investment – 31.5 million euros. In the same year, to the country’s budget more than 490 thousand euros in tax were paid. Through 2014 Lithuania’s startup companies attracted investments for 46.3 million euros thus, during 2014, Startup companies paid taxes of 2 million euros to the countries budget. The public authori- ties, administered by the public enterprise “Versli Lietuva”, invested 260 thousand euros, 42 million euros have been collected from various venture capital funds. It is important to mention that the largest investments were attracted by two market leaders – mobile appli- cation Yplan 21 million euros, and almost a million less, 20 million euros – the company Vinted – platform for purchasing, selling and exchanging clothing and accessories. Now the company operates not only in Lithuania, but also in other major world markets – the US, Great Britain, Germany, France, Poland and the Czech Republic. 2015 was as successful. 4 of the country’s most successful startups – Vinted, Vittamed, TRAFI and TransferGo received investments for more 41 million euros (public enterprise “Versli Lietuva” 2015). Not as large, but also very important, up to 0.5 million euros of investments have been attracted to more than a dozen country’s startup companies. During 2016, 28.4 million euros of investments were attracted from various venture capital funds. In 2015 independent Swedish enterprise “LitCapital”, managing the capital funds of development, has invested 3 million euros to Lithuania’s startup company “Brolis semiconductors” which operates in biotechnology and life sciences. Most investments in Sweden are attracted by startup companies creating finan- cial technology (eng. FINTECH), from 2011 to 2015 this company has attracted 621 million euros, this amounts to approximately 18 percent of the total investment, which was attracted to the startup companies in Europe that are developing the same activity (Skog et al. 2016). 63 Business, Management and Education, 2017, 15(1): 57–76 Interestingly, a common opinion is that the majority of startup founders – college or high-school students. In public enterprise’s “Versli Lietuva” study, conducted in 2014 (Versli Lietuva 2014), provides statistics that contradict this opinion – the startup founders average age is 31 years old. In addition, 87 percent of the founders have a university degree. Swedish startup founders are not only educated, but also have accumulated a lot of job experience. In summary, the Lithuanian and Swedish startup companies’ picture portrays a whole spectrum of properties, which declares basic startup business/enterprise concept. When char- acterizing the startup company by life cycle stages, it is possible to conclude a rationally composed totality of startup company’s distinctive features. 4. Life cycle of Startup business: theoretical aspects, Lithuania’s-Sweden’s case Startup company’s life cycle is widely discussed, as how this one differs from traditional organizations life cycle. According to A. Salamzadeh (Salamzadeh, Kawamorita 2015), it is important to carefully analyze the life cycle of startup company and to identify the key factors at every stage that would lead to the further successful startup development. During the idea generation phase entrepreneur’s initiative and tools turning idea into profitable business is important. The idea-generation process is important here; for the cre- ation of the prototype, the anticipation of funding attraction from personal, family or friend related and from other, external sources. According to J. Freear et al. (2002), this step is one of the most important and often determines the success of a startup company. The goal here is related to the design of company’s primary position, supporting the markets demand for created product or service through team building and management skills (Brush et al. 2006). Furthermore, it is at this stage, that business angels, venture capital funds decide whether to invest in promising startup companies. During the business planning stage, very important aspects are teamwork, developing the idea of the product or service, then the prototype, entrance to the market and measurement of product’s or service’s value. In order to achieve a steady growth of startup company, vari- ous support and mentoring programs, such as business accelerators or incubators, are being searched for. A. Salamzadeh (Salamzadeh, Kawamorita 2015) states that during this stage, the majority of startup companies face the greatest challenges and companies, incapable of controlling the risks, stop their activities and withdraw from the market. During the stage of the beginning of the business, startup companies begin to sell their products or services, includes itself into the market and develops structure of organizational management, employ staff of various areas (managers, engineers, IT specialists) (Salamza- deh, Kawamorita 2015). At this stage, it is important to attract more investment from vari- ous venture capital funds and/or individual investors. Corporate Finances are usually di- rected to the improvement of production processes, the deployment of new and high modern technologies. Along with the high-tech development; obstacles of entering the market with new products reduces. Startup businesses are often faced with limited financial and human 64 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development resources. It is for these reasons that the failure rate of IT startup companies is growing: during the first three years of existence almost 80 percent of startup companies fail due to unduly active competition for scarce resources (Feinleib 2012). From a practical perspective, IT startup companies contribute to society, creating jobs and encouraging innovation. In addition, high technology affects the development of various industries. From a theoretical perspective, scientists are discussing IT startup business’s growth phenomenon and tend to separate these businesses as distinctive busi- ness sectors. Numerous research examines the factors that influences the company’s ef- fective activities or factors that accompany the failure of the business, however, only a very small part of this research is dedicated to startup companies. For young companies, reasons of misfortune are often different from the ones that exist for a longer period of time. Small and young companies face a high probability of bankruptcy and reasons for their failure are often related with lack of resources and capacity (Thornhill, Amit 2003). Scientific studies have revealed the relationship between information technology and entrepreneurship. IT startup companies are adaptable to the business environment due to lack of settled business model, which traditional companies are often based on. Such ability to adapt to changes in the market is treated as a startup company’s competitive advantage. S. Yunfei et al. (2008) provides a business growth model of IT startup com- pany (see Fig. 1). According to the model, IT innovation – a key factor that affects the growth of the IT startup companies. The ability to adapt to the market determines the level of IT innovation and the development of the company. In addition, it is important to mention the customer’s involvement in this process: respect for the needs of potential buyers allows the company to constantly remain competitive in the market. The growth of IT startup company. According to stage trajectory of normal small and medium business growth, during growth stage, company reveals it’s potential to establish itself in the market and becomes competitive. Company’s growth and effective action causes are different. Growth stage is necessary for effective action. Flexible organization manage- ment structure, continuous actual resources gain and finally its profitability are excellent identifiers of company’s operating efficiency. IT startup company can be unprofitable, most important is to exhibit excellent skills in reallocating limited resources, developing products, attracting clients and retaining them. During growth phase IT startup company undergoes essential changes: in this stage company’s goal is to become an effective entity. At the IT innovation Ability to accommodate market IT innovation The growth of the IT startup company Drawing in of the customer Fig. 1. A business growth model of IT startup company (developed by the authors according to the S. Yunfei et al. (2008)) 65 Business, Management and Education, 2017, 15(1): 57–76 resources. It is for these reasons that the failure rate of IT startup companies is growing: during the first three years of existence almost 80 percent of startup companies fail due to unduly active competition for scarce resources (Feinleib 2012). From a practical perspective, IT startup companies contribute to society, creating jobs and encouraging innovation. In addition, high technology affects the development of various industries. From a theoretical perspective, scientists are discussing IT startup business’s growth phenomenon and tend to separate these businesses as distinctive busi- ness sectors. Numerous research examines the factors that influences the company’s ef- fective activities or factors that accompany the failure of the business, however, only a very small part of this research is dedicated to startup companies. For young companies, reasons of misfortune are often different from the ones that exist for a longer period of time. Small and young companies face a high probability of bankruptcy and reasons for their failure are often related with lack of resources and capacity (Thornhill, Amit 2003). Scientific studies have revealed the relationship between information technology and entrepreneurship. IT startup companies are adaptable to the business environment due to lack of settled business model, which traditional companies are often based on. Such ability to adapt to changes in the market is treated as a startup company’s competitive advantage. S. Yunfei et al. (2008) provides a business growth model of IT startup com- pany (see Fig. 1). According to the model, IT innovation – a key factor that affects the growth of the IT startup companies. The ability to adapt to the market determines the level of IT innovation and the development of the company. In addition, it is important to mention the customer’s involvement in this process: respect for the needs of potential buyers allows the company to constantly remain competitive in the market. The growth of IT startup company. According to stage trajectory of normal small and medium business growth, during growth stage, company reveals it’s potential to establish itself in the market and becomes competitive. Company’s growth and effective action causes are different. Growth stage is necessary for effective action. Flexible organization manage- ment structure, continuous actual resources gain and finally its profitability are excellent identifiers of company’s operating efficiency. IT startup company can be unprofitable, most important is to exhibit excellent skills in reallocating limited resources, developing products, attracting clients and retaining them. During growth phase IT startup company undergoes essential changes: in this stage company’s goal is to become an effective entity. At the IT innovation reference point, startup company is faced with a lack of resources and lack of experience in introducing new products to the market. The customer feedback is the key aspect here, because it enables company to improve and develop IT innovations (Cheung et al. 2011). Ability to accommodate market. IT startup companies operate in a competitive environ- ment, the ability to quickly adapt to changes in the market is a very important factor affect- ing the company’s opportunities of sustained survival in the market (Zahra et al. 2006). The field of IT is mobile and still new, so the company must quickly learn and apply knowledge in daily activities. Responding to market’s demand, the ability to adapt to the market, to learn and integrate resources are extremely important factors in IT startup company’s de- velopment and uptake in market. IT startup company’s learning culture is often based on “learning by doing” and “learning by putting effort”. The ecosystem of IT startup compa- nies is characterized by extreme conditions of uncertainty and extremely strong competi- tion, so companies must be prepared to critically evaluate their design, marketing activities and quickly respond to customer needs, providing concrete solutions (products or services). IT innovation. In a broad sense, IT innovation is often interpreted as process or prod- ucts/services innovation. The process in terms of IT innovation is when the company adapts to new production methods for the development of product or service. In terms of product, IT innovation refers to the newly created product or service. One of the ways to adapt to the constantly changing needs of customers, is to improve the development procedures of the product. In order to reduce operating costs, startup companies use open-source development tools and carry out the production work in developing coun- tries where labor costs are lower. Two different types of IT innovation are not isolated from each other, they may as well be consistent with each other and thus encourage more innovative product development (Mitchell, Shaver 2003). Drawing in of the customer. Cooperation with customers and their involvement in the development of the product is a factor that bases the development of innovation. Customers are able to facilitate at activities of the company and to provide an un- derstanding of the changes in the market, providing a new product idea (Debackere, Veugelers 2005). Collaboration with customers while developing or improving a product is an important trend of marketing communications (Lagrosen 2005). When IT startup companies start operating in the new market, customers become the “pillars”, helping in the establishment of the company into the market and overcome adverse changes. Loyal customers can help you see the current shortcomings of the new products. Startup companies often operate under conditions of high uncertainty and business success often depends on how the company is able to identify and develop strategies that could impact existing or potential risks for company. In addition, products de- veloped in IT sector are characterized by short product life cycle. In order to remain a leader, you must be very quick to react to market changes, trends and be able to introduce an innovative, high-quality product to the market at the right time. Business innovations should receive the greatest possible focus, high-tech innovations should be one of the most important factors in stimulating the development of IT startup company. 66 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development The life cycle of the startup company can be linked to its activity’s funding cycle, which is followed when the status report of the country’s startup ecosystem is being prepared. The funding cycle of Lithuania’s and Sweden’s startup companies consists of six phases: idea generation phase, idea launching phase, pre-growth phase, growth phase, fixed financing phase, the withdraw phase. In each of the phases, elements, that determine successful possibilities for transitioning to the next phase, can be distin- guished. It is appropriate to study such factors and use the results in order to ensure the business expansion of the company. 5. External factors that determine the startup company’s success Success of modern, innovative company depends on its ability to sell in a highly com- petitive market more than on its ability to ensure the quality (Ginevičius, Čirba 2009). According R. Ginevičius (2010) the main condition of the corporation survival in the market economy – their competitiveness. According to M. Samoška (2011) in the scien- tific literature competitiveness, business environment and business conditions are usu- ally used to describe the same object. It would be difficult to name one specific defini- tion of business conditions, because in the most cases, the term “business conditions” is associated with a complex of factors, or a rather a vague definition, which specifies only some of the elements of the business environment. According to V. Titarenko et al. (2007), the conditions of business are determined by complex factors such as business regulation, economic environment, political situation and the environmental protection. M. Samoška (2011), when defining the business environment, notes that in addition to economic, political environment and the environmental protection, the cultural, techni- cal, social and informational totality of the factors in a given geographically defined area is also very important. Legal factors may also be attributed to the business environment, since the legal disputes are an integral part of modern business projects (Keršulienė et al. 2010). The benevolence of business conditions, together with the success of a business depends on combination of factors mentioned above. The International Labour Organization’s (ILO) study of business conditions in con- nection with the success of a business entity that works in conjunction with the United Nations Organization (UNO), states that the development of sustainable, innovative business is a broad, often controversial issue. It is important to realize that the success of the business entity depends not only on the form of organizing the business, its size, but is very strongly influenced by the environment in which business is conducted. Both public institutions approach to certain business units and national and regional priorities, strategic directions and the legal regulation of business has a very significant impact on the development of the business. According to the study, sustainable, innova- tive development of the business should start from the State institutions and the latter’s improvement of the management structures. Sustainable and perspective companies require a strong, competitive market, powerful State institutions that could provide effective allocation of the human, financial and natural resources to ensure maximum 67 Business, Management and Education, 2017, 15(1): 57–76 productivity and a higher level of innovation. This, of course, requires new forms of cooperation between the authorities, business representatives and the public in order to ensure proper business conditions. From a level of macro perspective, every business is influenced by certain set of external factors that favor the business and have a ma- jor impact on the further successful development. Such factors as trading and market conditions, industry’s policy and legal environment shapes the business environment. J. Worthington and C. Britton (2006) offer to associate business environment with certain business restrictions with the help of which economic and social relations can be regulated. For the reason that businesses subjects cannot directly control the business restrictions, they may apply not only for a short, but also for extended period of time. The researchers also said that the business environment factors which are characterized by their nature can be divided into the operatives (affect a particular company in a par- ticular area) and the generals (affect concerning region-wide companies). According V. Titarenko et al. (2007) globalization processes that take place not only in the economic but also the social sphere, not only facilitates cooperation between companies, but also significantly strengthens the environment of business. In regard to free world-wide movement of goods and services, relations of cooperation grows stronger, therefore areas of company’s activities are changing, consequently the public authorities must pay more attention to improve the country’s business environment. V. Titarenko et al. (2007), M. Samoška (2011) states that business conditions may be synonymous to country’s potential level which, by being strengthened, could reach for higher levels of competitiveness. Therefore, business conditions show how easily and how quickly the business units are to achieve significant results. Business conditions are expressed as a combination of external factors that determine the success of a business entity in a particular market. 6. Business conditions and its improvement in Lithuania and Sweden The promotion of the new business establishment and development is one of the State’s greatest priorities of the competitiveness policy. The State acts as one of the fundamental forces that regulate the business environment of each country’s economy (Smallbone, Welter 2001). For that very reason it is important to understand what the main areas of the State’s activities are and how regulatory laws of business are inducing the develop- ment of small and medium business (SME) (Lithuanian Parlament 2007; Lithuanian Ministry of Economy 2014). The State’s support for the development of SME can be understood as a set of tools. Technical assistance and financial support – are the tools for the development strategy of SME. D. Smallbone and F. Welter (2001) distinguish a number of areas where the State indirectly affects small business. Primarily, the macroeconomic environment and its improvement. Smaller businesses, apparently, are not very sensitive to changes in the macroeconomic environment. One of the ways for the State to regulate the development 68 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development of SME is to apply a different legal base accordingly to an entity’s size. According to LR’s SME law of development, in Lithuania, four types of companies, regarding their employment and income, are distinguished. All companies essentially operate in differ- ent ways, therefore the law and the State’s strategy towards them differentiates. When applying uniform standards for all companies, the final result of corporate welfare may vary widely. It is only natural, that the tax burden and the respect for demand of extrude could become too severe for SME business and thus the development of the business could be indirectly decelerated. Another implement for SME development is the direct application of support mea- sures, various programs and initiatives, devoted to help solve the problems caused by lack of resources. In the long term, these companies are beneficial to the economy as they are creators of workplace and stimulates the economy; to increase their potential, direct and technical support, funding from the State or EU must be applied. Accord- ing to D. Smallbone and F. Welter (2001), measure that affects the SME development is related to various institutions. Promotion associations of young business, business incubators, banks, other financial institutions that in one way or the other contributes to support SMEs, must be regulated, but easily accessible. In this case, State’s aid for small economy subjects is granted indirectly, offering organized and detailed information about institutions that may be contacted for support, whilst ensuring that actions of these insti- tutions, programs they create and their initiatives would remain transparent and provide tangible benefits to the business for which such aid is necessary. In summary, to ensure sustainable development of the SME, the State must take care of: the improvement of the macroeconomic environment, the differentiation of the legislative base for economy subjects, tools of the direct support, financial and technical support, maintenance of private institutions and business promotion programs and dissemination of information. To achieve an effective implementation of the objectives pursued by the State, long- term strategies are created. One of them – the long-term strategy of the State’s develop- ment. Its main goal – to create an environment to develop the country’s material and spiritual well-being, which is generally described by the knowledge society, secured society and competitive economy. SMEs are an important part of realization process of a strategy and these strategic areas of SMEs’ development are distinguished: 1. Promotion of establishment of new small and medium-sized enterprises. 2. Development and improvement of financial services and conditions for SME to use them. 3. Promotion of establishment of innovative enterprises. 4. Improvement of employee qualifications in small and medium-sized businesses. 5. Improvement of infrastructure of small and medium-sized business. One of the key aspects to ensure the growth of the SME sector is the uniformity of economic development. SME’s development in Lithuania and in different regions differs due to economic conditions, infrastructure, access for education and its quality, receivable income and other regionally related actions (Baležentis, Vijeikis 2010). That 69 Business, Management and Education, 2017, 15(1): 57–76 is why, following the expected trends and challenges of SME’s development, State seeks to implement on three institutional levels: at the national level through the national SME development program, at regional level to ensure the activities of institutions and the development of the local level – support and development of entrepreneurs and level of business. The economy of Sweden is often seen as one of the most innovative economies in the world. Business conditions there are considered to be very favorable for development of startup companies. The Swedish Government is actively contributing to the creation of startups in the country by establishing and facilitating the best possible conditions for the creation of investment funds, incubators that encourage high-technology transfer, innovation, dissemination and entrepreneurship (Zoltan et al. 2015). One of the priority areas in Sweden – the digital economy. Precisely for this reason, during the last decade, public sector organizations are devoting a great measure of focus to the development of high-tech infrastructure which resulted in formation and development of more world- renowned IT startup companies such as Skype, Spotify, Mojang, iZettle, that leads to continued and promising formation of IT startup companies (Mitzner 2016). Swedish good practice of startup business creation and development is one of the factors of our country’s business competitiveness. It should be noted here, that Israel occupies a leading position in the world, when we compare the startup companies per Fig. 2. The ecosystem of startup companies in Israel (developed by the authors according to the D. Senor, S. Singer (2009)) Authorities (Ministry of economics, „Invest in Israel“, etc. ) 75 venture capital funds 9 universities: academic education, research, incubators promoting entrepre- neurship 5000 startup companies (3500 IT startup companies) 280 international enterprises filials, 220 research laboratories 60 business incubators Accelerators (,,The time“, ,,Explore“, ,,The Elevator“ etc.) 70 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development capita. The region of Tel Aviv, which houses most of the IT startup companies, innova- tion and high-tech application in these companies when developing products or services, became an established norm (see Fig. 2). State institutions of Israel are successfully adapting to market changes and works closely with the business community that is encouraged to share its experiences of innovation and corporate management. This kind of close cooperation, for example, between education institutions and businesses representatives provides greater opportu- nities to use accumulated academic knowledge to practical development of new startup companies (Senor, Singer 2009; Kandel et al. 2011). 7. Success factors of startup companies’: external factors, Lithuania’s and Sweden’s case Based on evaluation methodologies of favorable business conditions such as the World Eco- nomic Forum and the World Bank’s “Doing Business” valuation models of business condi- tions, it is appropriate to distinguish external factors that are essential and had the greatest influence on successful development of IT startup companies (see Table 1). The evaluation of external success factors of startup companies’ activities are based upon analysis of the scientific literature, main group criteria of the World Economic Forum and the World Bank’s “Doing Business” Global Competitiveness Index’s three main sub-indexes: the sub-index of the basic requirements, the sub-index of the inducing performance factors, the sub-index of innovation and business sophistication. Based on analysis of the scientific theory and valuation models of favored business conditions, the external factors that had the greatest impact on successful IT startup companies development can be distinguished – these are the conditions which cannot be changed by an organization, but must be properly evaluated, otherwise, disregarding these factors may imply negative efect on the development of organization. The assur- ance of these environmental factors, that favors the formation of startup businesses and expansion of its activities, is the prerogative of public institutions. External environment consists of the totality of international community’s develop- ment factors that makes a consistent impact on country’s social, economic and market development to the political, economic, social efficiency, this efficiency limits the de- velopment of organization’s actions. In the context of the study’s object, analysis and evaluation of external factors are essential for the interested parties in order to: – Compose the groundwork for extension of the potential in formation and develop- ment of startup companies in the context of other countries; – Know and evaluate the situation in the market in which it intends to operate or already operates; – Identify and explore the factors that can potentially create barriers to establish and operate a startup company; – Evaluate their attractiveness and demand for the created product. 71 Business, Management and Education, 2017, 15(1): 57–76 Table 1. External factors that have the greatest impact on the success development of IT startup companies (developed by the authors according to the World Economic Forum 2015–2016) No External factors Description of external factors 1. Conditions for starting a business How easy is it to start a new business, how do public institutions to contribute to creating and implementing the reforms of business regulation, which facilitate the procedures to establish a business? 2. Getting permits What financial and time resources are available for getting the permits to start a business? 3. Labor market efficiency Is it possible to meet the needs of investors associated with the quality of the workforce? 4. Getting credit Domestic banks and other financial institutions’ proposed incentives to finance new business creation. 5. Investor protection Level of investor protection in the country, where is created business, is one of the most important criteria in order to attract as much as possible foreign individual investors. 6. Tax environment What are the preferences for the new created business in the country? 7. International trade Export and import conditions in the country, where is developed startup business. 8. Infrastructure level Logistics level, roads, ports and the other quality. 9. Health protection The measures to conserve and preserve the health in the country. 10. Corruption Level of corruption in the country, the shadow economy impact on business development. 11. Market size Market size is the determining factor when there are introduced new products, from the size of the market belongs the product demand. 12. Financial market development The quality of the country’s financial services, consumer protection, regulation of the activities of operators providing these services. 13. Technological development Using of digital technology by population, using of digital technology by the authorities. 14. Innovations State policy in promoting innovative activities, in developing and implementing a variety of electronic platform, which would save society time, financial resources. 15. Higher education systems and vocational education The level of education in the country. Skilled and unskilled labor in the context of a newly created business. 16. Startup corporate sponsorship (business incubators, accelerators, technological parks) Support for new entrepreneurs, job promotion, corporate operational risk reduction, other ways to help startup companies to generate and implement innovative business ideas. 72 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development – “SUP46” startup center operating in Sweden, notes the following key factors for startup business success: – The country’s long-standing experience in sectors of design and engineering; – Growing community of startup business; – Mature ecosystem of startup business; – Well-developed high-tech infrastructure; – Knowledge society; – The country’s high standard of living; – Substantial image of the country; – Products created by startup companies satisfying the needs of consumers in dif- ferent countries; – Organizational management structure, based on the promotion of creativity. 8. Conclusions According to analysis of startup’s concept, it can be said that the model of the busi- ness is based on high-tech transition thus the innovative business solutions that are the base for product creation, the consumption of which promotes the development of the knowledge society; other attribute of the business model – startup business model is based on the external funding. The similarities of Lithuania’s and Sweden’s approaches of the concept of the startup business are treated as favorable assumptions (the meeting points of the countries’ business culture) for strengthen the bilateral economic relation- ship through the perspective of startup company’s development. In the picture of Lithuanian and Swedish startup companies the totality of attributes could be perceived, that is declared in the basic concept of the startup business/enter- prise. When characterizing the startup company by the stages life cycle, it is possible to conclude a rationally composed totality of startup company’s distinctive features. The life cycle of startup companies are widely discussed, as it differs from traditional organizations life cycle. It is important to analyze the development of the life cycle of startup company and, at every stage, identify the key factors that would lead to the fur- ther successful development. Lithuanian and Swedish startup companies’ life cycles are associated with the financing of the operation cycle. This cycle consists of the beginning of idea generation phase, idea launching phase, pre-growth phase, growth phase, fixed financing phase and the withdraw phase. The success of modern, innovative company depends on their ability to sell in a highly competitive market. The business conditions are equated with the level of coun- try’s potential, by strengthening which, a higher level of competitiveness is achieved. So the business conditions show how easily and how quickly the business units are to achieve significant results. They are expressed as a combination of external factors that, in a particular market, determine the success of a business entity. 73 Business, Management and Education, 2017, 15(1): 57–76 The promotion and development of the new business establishment is a priority of Lithuania’s and Sweden’s competitiveness policy. Countries act as one of the funda- mental forces that regulate the business environment of each country’s economy. For this reason, it is important to understand what the main aspects of the State’s activities are and how the regulatory laws are affecting startup business. The determination of external success factors of startup companies are substantiated by the analysis of scientific literature, the main group criteria of World Economic Fo- rum and the World Bank’s “Doing Business” Global Competitiveness Index. The most important Swedish startup business success factors are: the country’s long-standing experience in the design and engineering sectors, the growing community of the startup business, the mature ecosystem of the startup business’, well-developed high-tech in- frastructure, the knowledge society, the country’s high standard of living, a substantial image of the country, products created by startup companies satisfying the needs of consumers in different countries, organizational management structure based on the promotion of creativity. External factors that have an impact on successful development of IT startup com- panies – these are the conditions, which cannot be changed by an organization, but must be properly evaluated; otherwise, disregarding these factors may have a negative impact on the development of organization. The assurance of these environmental fac- tors, that favors the formation of startup businesses and expansion of its activities, is the prerogative of public institutions. The analysis and evaluation of external factors are essential for the interested parties in order to create conditions for increasing the formation of startup companies whilst the development potential in the context of other countries, to know and evaluate the country’s business position in the global market, to identify and explore the factors that can potentially create barriers for the formation of a startup company and its operation; evaluate their attractiveness and demand for the created product. Disclosure statement Authors declare that they do not have any competing financial, professional, or personal interests from other parties. References Akram, M. Ch.; Faheem, A. M.; Dost, M. K. B.; Iqra, A. 2011. Globalization and its impact on the world economic development, International Journal of Business and Social Science 2(23): 291–297. Baležentis, A.; Vijeikis, J. 2010. Crisis management factors and means in Lithuanian enterprises, Management Theory and Studies for Rural Business and Infrastructure Development 23(4): 1–10. Blank, S.; Dorf, B. 2012. The startup owner’s manual: the step-by-step guide for building a great company. California: K&S Ranch. 74 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development Brush, C. G.; Carter, N. M.; Gatewood, E. J.; Greene, P. G.; Hart, M. M. 2006. The use of bootstrap- ping by women entrepreneurs in positionin for growth, Venture Capital 8(1): 15–31. https://doi.org/10.1080/13691060500433975 Cambridge Business English Dictionary. 2011. Cambridge: Cambridge University Press. Costa, S. 2004. 100 years and counting, Management Review 83(12): 32–34. Cheung, C.; Lee, M.; Jin, X. 2011. Customer engagement in an online social platform: a conceptual model and scale development, Proceedings of the 32th International Conference on Information Sys- tems, 4–7 December, 2011, Shanghai, China. Debackere, K.; Veugelers, R. 2005. The role of academic technology transfer organizations in improving industry science links, Research Policy 34(3): 321–342. https://doi.org/10.1016/j.respol.2004.12.003 Dee, N.; Gill, D.; Weinberg, C.; McTavish, S. 2015. Startup support programmes: what’s the differ- ence? [online], [cited 17 January 2017]. Available from Internet: http://www.nesta.org.uk/sites/default/ files/whats_the_diff_wv.pdf ESM. 2015. European startup monitor [online], [cited 16 January 2017]. KPMG. Available from Internet: https://assets.kpmg.com/content/dam/kpmg/pdf/2016/03/esm_final_WEB.pdf Feinleib, D. 2012. Why startups fail and how yours can succeed [online], [cited 10 January 2017]. USA: Apress. Available from Internet: http://link.springer.com/book/10.1007%2F978–1–4302–4141–6 Freear, J.; Sohl, J. E.; Wetzel, W. 2002. Angles on angels: financing technology based ventures a historical perspective, Venture Capital: An International Journal of Entrepreneurial Finance 4(4): 275–287. https://doi.org/10.1080/1369106022000024923 Ginevičius, R. 2010. The effectiveness of cooperation of industrial enterprises, Journal of Business Economics and Management 11(2): 283–296. https://doi.org/10.3846/jbem.2010.14 Ginevičius, R.; Čirba, S. 2009. Additive measurment of market concentration, Journal of Business Economics and Management 10(3): 191–198. https://doi.org/10.3846/1611–1699.2009.10.191–198 Graham, J. P.; Spaulding, R. 2005. Understanding foreign direct investment [online], [cited 20 Novem- ber 2016]. Available from Internet: http://www.going-global.com/articles/understanding_foreign_di- rect_investment.html Hammarberg, E.; Gräf, L.; Menke, T.; Weinstock, M. 2016. Be part of Stockholm’s impressive startup network [online], [cited 10 January 2017]. Available from Internet: http://magazine.startus.cc/impres- sive-startup-network-in-stockholm Jakubavičius, A.; Strazdas, R.; Gečas, K. 2003. Innovation: processes, management models and pos- sibilities. Vilnius: Lithuanian Innovation Centre [online], [cited 26 November 2016]. Available from Internet: http://www.inovacijos.lt/inopagalba/cms/62lt.pdf Kandel, E.; Leshchinskii, D.; Yuklea, H. 2011. VC Funds: aging brings Myopia, Journal of Financial and Quantitative Analysis 46(2): 431–457. https://doi.org/10.1017/S0022109010000840 Keršulienė, V.; Zavadskas, E. K.; Turskis, Z. 2010. Selection of rational dispute resolution method by applying new stepwise weight assessment ratio analysis (SWARA), Journal of Business Economics and Management 11(2): 243–258. https://doi.org/10.3846/jbem.2010.12 Kraujelytė, A.; Petrauskas, R. 2007. Role of technology transfer in innovation process: Lithuanian innovation policy perspective, Public policy and Administration 19: 54–68. Lagrosen, S. 2005. Customer involvement in new product development: a relationship marketing perspective, European Journal of Innovation Management 8(4): 424–436. https://doi.org/10.1108/14601060510627803 https://doi.org/10.1080/13691060500433975 https://doi.org/10.1016/j.respol.2004.12.003 https://doi.org/10.1080/1369106022000024923 https://doi.org/10.3846/jbem.2010.14 https://doi.org/10.3846/1611-1699.2009.10.191-198 https://doi.org/10.1017/S0022109010000840 https://doi.org/10.3846/jbem.2010.12 https://doi.org/10.1108/14601060510627803 75 Business, Management and Education, 2017, 15(1): 57–76 Lithuanian Ministry of Economy. 2014. Lithuania entrepreneurship action plan for years 2014–2020 [online], [cited 16 January 2017]. Available from Internet: https://ukmin.lrv.lt/lt/veiklos-sritys/vers- lo-aplinka/smulkiojo-ir-vidutinio-verslo-politika/verslumo-skatinimas/lietuvos-verslumo-veiksmu- 2014–2020-metu-planas Lithuanian Parlament. 2007. The law of Lithuanian small and medium business development [online], [cited 17 January 2017]. No X-1346. Available from Internet: https://e-seimas.lrs.lt/portal/legalAct/ lt/TAD/TAIS.310857?positionInSearchResults=1&searchModelUUID=ac865654–4441–4594-b618- b495e22ecd6a Mitchell, W.; Shaver, J. M. 2003. Who buys what? How integration capability affects acquisition incidence and target choice, Strategic Organization 1(2): 171–201. https://doi.org/10.1177/1476127003001002305 Mitzner, D. 2016. Sweden is a tech superstar from North [online], [cited 09 January 2017]. Available from Internet: https://techcrunch.com/2016/01/26/sweden-is-a-tech-superstar-from-the-north/ Moon, S. 2014. How does the use of external knowledge influence innovative performance of service firm an intro-ductory study of openness and service innovation, Seoul Journal of Business 20(1): 35–61. Norris, D. 2014. The 7 day startup: you don’t learn until you launch. New York: Lioncrest Publishing. Ogunsola, L. A. 2005. Information and communication technologies and the effects of globalization: twenty-first century “Digital slavery” for developing countries – myth or reality?, Electronic Journal of Academic and Special Librarianship 2(1): 1–2. Patel, N. 2011. Startup stars: a brief history of the best 20th century business launches [online], [cited 10 January 2017]. Available from Internet: http://www.geekwire.com/2011/startup-stars-history-20th- century-business-launches/ Ries, E. 2012. LEAN Startup metodika. Vilnius: Eugrimas. Rogers, E. M.; Takegami, Sh.; Yin, J. 2003. Lessons learned about technology transfer, in International Series on Technology Policy and Innovation. Westport (Connecticut), London: Praeger, 369–382. Roure, J. B.; Maidique, M. A. 2002. Linking prefunding factors and high-technology venture success: an exploratory study, Journal of Business Venturing 1(3): 295–306. https://doi.org/10.1016/0883–9026(86)90006–6 Salamzadeh, A.; Kawamorita, K. 2015. Startup companies: life cycle and challenges, Proceedings of the 4th International Conference on Employment, Education and Entrepreneurship, 14–16 October, 2015, Belgrade, Serbia. https://doi.org/10.2139/ssrn.2628861 Samoška, M. 2011. Analysis of business environment evaluation methods, Business in XXI Century 3(4): 28–89. Sels, L.; Vanhoutte, C. 2005. An inquiry into the impact of pre start-up business planning on new business ventures’ performance [online], [cited 10 January 2017]. Available from Internet: https:// www.researchgate.net/publication/228466553_An_Inquiry_into_the_Impact_of_Pre-Start-up_Busi- ness_Planning_on_a_New_Business_Venture%27s_Performance Senor, D.; Singer, S. 2009. Start-up nation: the story of Israel’s economic miracle. New York: Hachette Book Group. Skog, A.; Lewan, M.; Karlström, M.; Morlgulis-Yakushev, S.; Lu, Y.; Teigland, R. 2016. Chasing the tale of the unicorn – a study of Sweden’s misty meadows [online], [cited 08 January 2017]. Available from Internet: https://www.iis.se/docs/Chasing-the-Tale-of-the-Unicorn-A-study-of-Stockholms-misty- meadows.pdf Smallbone, D.; Welter, F. 2001. The Role of government in SME development in transition countries, International Small Business Journal 19(4): 63–77. https://doi.org/10.1177/0266242601194004 https://doi.org/10.1177/1476127003001002305 https://doi.org/10.1016/0883-9026(86)90006-6 https://doi.org/10.2139/ssrn.2628861 https://www.researchgate.net/publication/228466553_An_Inquiry_into_the_Impact_of_Pre-Start-up_Business_Planning_on_a_New_Business_Venture%27s_Performance https://www.researchgate.net/publication/228466553_An_Inquiry_into_the_Impact_of_Pre-Start-up_Business_Planning_on_a_New_Business_Venture%27s_Performance https://www.researchgate.net/publication/228466553_An_Inquiry_into_the_Impact_of_Pre-Start-up_Business_Planning_on_a_New_Business_Venture%27s_Performance https://www.iis.se/docs/Chasing-the-Tale-of-the-Unicorn-A-study-of-Stockholms-misty-meadows.pdf https://www.iis.se/docs/Chasing-the-Tale-of-the-Unicorn-A-study-of-Stockholms-misty-meadows.pdf https://doi.org/10.1177/0266242601194004 76 Ž. Tunčikienė, G. Sinkevičiūtė. Strenthening opportunities of economic relations between Lithuania and Sweden within the perspective of IT startup company’s development U.S. Bureau of Labor Statistics. 2014. Startups and older firms: which is more responsive to local economic changes? [online], [cited 17 January 2017]. Available from Internet: http://www.bls.gov/ opub/mlr/2014/beyond-bls/startups-and-older-firms.html SUP46. 2015. The Swedish startup scene [online], [cited 08 January 2017]. Available from Internet: http://sup46.com/wp-content/uploads/2016/03/SUP46_Annual_Swedish_Startup_Infographic_2015.pdf The World Bank. 2015. Doing business 2015: going beyond efficiency [online], [cited 21 November 2016]. World Bank Group. Available from Internet: http://www.doingbusiness.org/reports/global-re- ports/doing-business-2015 Thornhill, S.; Amit, R. 2003. Learning about failure: bankruptcy, firm age, and the resourcebased view, Organization Science 14(5): 497–509. https://doi.org/10.1287/orsc.14.5.497.16761 Titarenko, V.; Zabielaitė, J.; Rudzkis, R.; Rojaka, J. 2007. Business conditions and their improvement in Lithuania. Report of Applied Scientific 1: 132. Versli Lietuva. 2013. Annual review of Startup Lithuania [online], [cited 24 November 2016]. Availa- ble from Internet: http://www.verslilietuva.lt/uploads/media/569612d551857/Startup%20Lithuania%20 2013%20apzvalga.pdf Versli Lietuva. 2014. Annual report of Enterprise Lithuania [online], [cited 24 November 2016]. Avail- able from Internet: http://www.verslilietuva.lt/uploads/media/5603de0f66ddc/2014%20metine%20 veiklos%20ataskaita.pdf Versli Lietuva. 2015. Annual review of Lithuanian start-ups ecosystem [online], [cited 24 November 2016]. Available from Internet: http://startuphighway.com/wp-content/uploads/2015/05/Lithuanian_ startup_ecosystem.pdf? Versli Lietuva. 2016. Lithuania in 2016–2017: enterprise, smart, promising [online], [cited 29 De- cember 2016]. Available from Internet: http://www.verslilietuva.lt/lt/naujienos/naujienos/lietuva- 2016–2017-versli-ismani-perspektyvi/618 World Economic Forum. 2015–2016. The Global Competitiveness Report 2015–2016 [online], [cited 09 January 2017]. Available from Internet: http://reports.weforum.org/global-competitiveness-re- port-2015–2016 Worthington, J.; Britton, C. 2006. The business environment. London: Pearson Education Limited. Yunfei, S.; Dongming, X.; Green, P. 2008. Software startup growth: the role of dynamic capabities, IT innovation and customer involvement [online], [cited 12 January 2017]. Available from Internet: http://www.pacis-net.org/file/2014/2026.pdf Zahra, S. A.; Sapienza, H. J.; Davidsson, P. 2006. Entrepreneurship and dynamic capabilities: a review, model and research agenda, Journal of Management Studies 43(4): 917–955. https://doi.org/10.1111/j.1467–6486.2006.00616.x Zoltan, J. A.; Szerb, L.; Autio, E. 2015. Global enterpreneurship index [online], [cited 11 January 2017]. Available from Internet: http://redit.skane.com/sites/default/files/media/document/gei_2015.pdf Živilė TUNČIKIENĖ. Associate Professor. Department of Social Economics and Business Manage- ment, Faculty of Business Management, Vilnius Gediminas Technical University. Research interests: management of socioeconomic development, strategic management of public sector, environmental assesment for ease of doing business. Gabrielė SINKEVIČIŪTĖ. Masters’ student, Department of International Economics and Business Management, Faculty of Business Management, Vilnius Gediminas Technical University. Research interests: business success factors, opportunities of economic relations. Head of the Swedish Chamber of Commerce in Lithuania. http://www.bls.gov/opub/mlr/2014/beyond-bls/startups-and-older-firms.html http://www.bls.gov/opub/mlr/2014/beyond-bls/startups-and-older-firms.html http://sup46.com/wp-content/uploads/2016/03/SUP46_Annual_Swedish_Startup_Infographic_2015.pdf https://doi.org/10.1287/orsc.14.5.497.16761 http://startuphighway.com/wp-content/uploads/2015/05/Lithuanian_startup_ecosystem.pdf http://startuphighway.com/wp-content/uploads/2015/05/Lithuanian_startup_ecosystem.pdf http://reports.weforum.org/global-competitiveness-report-2015-2016 http://reports.weforum.org/global-competitiveness-report-2015-2016 http://www.pacis-net.org/file/2014/2026.pdf https://doi.org/10.1111/j.1467-6486.2006.00616.x http://redit.skane.com/sites/default/files/media/document/gei_2015.pdf