Alex Antonuk:
— Hey friends! I’m Alex Antonuk, and this is Built in the Digital Republic – a podcast about Estonia and Estonian companies in the world of tech.
In today’s pilot episode, we’re talking about Estonian developers in British startups – their expertise, mindset, work culture, cost, and, most importantly, the reputation they’re building in the UK. Is hiring them already a trend, or just a couple of standout cases? And what is it that makes Estonian developers stand out?
Let’s ask our guest: Jack Mangnall, co-founder of Shape Technologies, a UK-based fintech startup.
The company entered the market two years ago and is already working with several European PSPs and PayFacs, offering a ready-to-use, fully customizable fintech platform as a service. The product is delivering results – Shape has showcased its platform at major fintech events, including Seamless Europe, expanded internationally, and started scaling its partner network across Europe.
Well, looks like Jack has plenty to share.
Hi, Jack, welcome to the show!
Jack Mangnall:
— Hi, Alex, thanks for welcoming me into the show. It’s great to be here!
Alex Antonuk:
— Glad to have you here.
Let’s go!
[Musical intro]
— A brief note for context. Estonia is one of the world’s most digitally advanced – and, notably, one of the earliest – e-nations. It was among the first to begin digitizing its government infrastructure in the late 90s, long before it became a broader trend across Europe.
Today, according to the European Commission, Estonia consistently ranks among the top three EU countries for digitalization, with more than 99% of public services available online. Despite a population of just 1.3 million, the country hosts several thousand IT companies, including globally recognized names such as Bolt and Wise, as well as the now-retired but iconic Skype. Nearly 1,400 of these companies are fast-growing startups.
Jack, I’m guessing you probably looked into Estonia a bit before hiring developers from there. So, the small country with a complex past, and yet, in just a few decades, it’s become a serious player.
What do you think is behind that? Is it the mindset, smart government policy, or is there something in Estonian engineering culture itself?
Jack Mangnall:
— Great question. No doubt a blend between all of those. From our point of view, the engineering culture is what sets the Estonian development team apart from others that we looked at when starting Shape. So, if we look at the work ethic that every single individual in the team has, it’s second to none.
We’ve been fortunate enough to spend a lot of time face-to-face with the teams in Estonia, and just their approach to everyday work is first-class. They look to identify problems as quickly as possible, and once they’ve identified solutions, they set out to solve those problems by developing great solutions very, very quickly.
So, yes, it’s got to be the engineering culture from our point of view. That’s the thing that makes them stand out massively.
Alex Antonuk:
— Well, one way or another, hiring Estonian teams seems to be becoming a trend among UK startups.
To back that up, according to Statistics Estonia, exports of IT services to the UK grew by 28% in 2024 Q4 compared to the same period in 2023, reaching €207 million. The UK is now Estonia’s fourth-largest EU partner in IT exports, and this particular destination saw record growth.
There are also industry articles exploring this trend (for example, about the startup Myota) and even platforms that offer Estonian team hiring as a service.
Jack, have you and your fellow founders started noticing this shift, too?
Jack Mangnall:
— Yes, definitely have. I’m fortunate to speak to lots of different founders these days, which is always great to hear people’s agendas that they’re on.
One thing that stands out is the time to market. So I’m sure we’ll talk about lots of different things today, but when you start in a new business, especially in tech, you back yourself for that solution to be innovative, and you want to be first to market because there’s always going to be someone else coming after you.
So, you need to have a development partner that you know is going to actually build your solution on time and at the highest standard. And I think a lot of my fellow founders are turning to Estonia for that very reason.
Alex Antonuk:
— Okay, and in your view, is this trend driven more by cost, development speed, and trust, or is something else going on there?
Jack Mangnall:
— It’s a combination of all of them from my point of view. So, to bring this to life, when we launched Shape about three years ago now – just gone in the blink of an eye – we looked at Bulgaria, Moldova, Romania, quite a lot of other countries, the UK as well.
The one thing that sets Bamboo Group apart, which is the company we work with in Estonia, is that they didn’t just throw rate cards at us. They weren’t just trying to show us all the other fintech projects that they’d worked on.
What they did better than anyone else was that they took time to understand what it was we wanted to build, why we wanted to build it, and where we wanted to be five years from that day, so two years from now. And, before we even signed on the dotted line or committed to spending a single penny with Bamboo, they really would tell us exactly how they were going to deliver what we wanted to deliver with a budget, with a project timeline.
And so we were able to agree to those things, and no other company that we spoke to took anywhere near the level of care and due diligence that early in the process.
So I obviously can’t say that’s every single Estonian company, every single Estonian development company out there, but in our case with Bamboo, that’s exactly what we got.
Alex Antonuk:
— Okay, and there are so many talent hubs out there: India, Poland, Romania, Serbia – lots of skilled developers, often at lower rates. So why did you choose Estonia, considering that you hadn’t yet experienced these trends you just described?
Jack Mangnall:
— So cost is important.
We certainly, when we look at rate cards, we never want to pay the highest rate. If I’m honest with you, when you’re starting a business, you are to be raising money or spending your own, and every founder starts a business because they probably want to exit that one day. So you’re looking at every pound, euro, or dollar you spend, how much you’re actually going to be able to convert that into in a matter of years.
So we really looked at the total spend to deliver the project. And so when we were talking to development companies in some of the countries you’ve mentioned, we were looking at hourly rates, but we never really got a sense of how much it would cost us to build the entire platform.
So, we wanted to understand how quickly we could get to market, how much it would cost us to get there, and how good our platform would be by the time we actually get to market.
We want the quality of what we’ve built to be first-class, best-in-class. We want every single customer who uses it to want to keep using it. And so it’s a combination of cost, time to market, and yes, trusting that your development partner is going to deliver what you want, what you designed as a best-in-class solution.
Alex Antonuk:
— I see what you mean. Okay, and what was your specific technical goal at the time? What kind of expertise, stack, or approach were you looking for? And what did the Estonian team bring to the table? It would be nice to hear some tech cases, if possible.
Jack Mangnall:
— Well, to be honest with you, you’ll have to ask my co-founder because he looks after the technical and product side of the business. What I can tell you, which I hope is useful to the listeners as well, is that we are clearly a fintech for payments platform, and all the other development companies we’ve spoken to have built lots of other fintech platforms before and integrated with payment gateways, different acquirers. And if I’m right in thinking, at the time that we spoke with Bamboo three years ago, they probably integrated with Stripe a couple of times, but they didn’t necessarily have extensive experience in working within the payments industry or the wider fintech industry.
I think I’m right in saying that.
However, the level of detail they went into – exploring the industry, understanding all the different stakeholders, what their APIs looked like – because a huge part of the Shape model is not just a platform that we’ve built, but the ecosystem: all the different providers that it can plug into (data providers for global KYC, KYB, AML, integrated with payment gateways, acquirers, and banking providers). They had to go away and learn a whole new industry. And they did that in record time. We helped them, we gave them the expertise that we had, but their ability to research, to understand things that were new to them, really set them apart.
Alex Antonuk:
— You’ve already touched on it a bit, but I’d love to hear more. What do you think sets the Estonian approach apart from British teams exactly?
Jack Mangnall:
— So when you’re in the office with the guys, their approach to work, like I mentioned before, is first-class. They come in, everyone’s very polite, very nice to each other.
But ultimately, every single person is there to work. They take real pride in delivering quality, and they take real pride in ultimately giving their all to their work.
So when I’ve worked in other companies within tech before, what you tend to find in the UK, whether that’s using in-house development or other overseas development resources, is the projects are delivered late. Roadmaps get congested. And ultimately, as a commercial person – that’s my background, by the way – you’re left in a position where you have to communicate that to your customers, so all your existing customers; you’re having to let them down because you’re not delivering something you’re permitted to.
And what we’ve actually found with Bamboo, with the Estonian team, is that 99% of the time, they deliver on time and on budget. But what we also find, which is not surprising, is that they tend to deliver early quite often, which means we can cram more into our roadmap. As a startup, where you raise a specific amount of money to deliver a certain amount… delivering things early means that you could do so much more with the money that you’re using.
So it’s been really, really refreshing to see that it is possible to deliver tech platforms, software on time and on budget. Because, to be honest with you, it’s been all too familiar for things not to go like that.
Alex Antonuk:
— Yeah, yeah. You know, as a project manager, I completely understand the value of it when your team just delivers even more than you planned at the initial planning. That’s true.
Jack Mangnall:
— Yeah, from my point of view, with that, I mean… I said earlier that I’m not a tech guy at all. And one of my frustrations is always when you can’t help but ask yourself why things haven’t been done on time. And it’s really hard for someone technically, an engineering person, to explain to me where delays have happened.
So it’s just nice not to even have to entertain those conversations because things aren’t being delayed. And because it does, I’ve seen it cause a lot of friction between commercial product and tech teams in the past, where things aren’t done on time.
So it’s good not to be in that position with Shape.
Alex Antonuk:
— Yeah, that’s true. That was really interesting to hear, thank you. And just to keep things balanced, was there anything you felt was occasionally lacking in your collaboration with the Estonian team? Anything you would perhaps like to see improved?
Jack Mangnall:
— It’s an interesting one because I think the honest answer is that the working culture between British companies and Estonian companies is very different.
In the UK, I think we tend to try and maybe have more of a social relationship within the office. And I think that seems to be quite different from Estonia, but we’ve overcome that because we’ve just spent time together, and we’ve spent time to understand how each business operates differently, how all the individuals are culturally different. So, at the start, it was something to get used to. But ultimately, in the course of my career, I’ve worked with people from all across the world.
But it’s, you know, I turn up to a call, and I want to have some small talk. I want to ask about the weekend and see what people are doing in terms of holidays and things like that. And don’t get me wrong, everyone is always very polite and happy to answer those questions. But I think sometimes I’ve taken people by surprise. But over time, I think they look forward to those conversations with us now.
But ultimately, if they were more like us, more like the British culture, they probably wouldn’t be delivering things as quickly.
So, finding the balance between the cultures is taking some time. But ultimately, it’s delivered something really good. And we have a great working relationship now.
The other thing is when there’s clearly a lot of miles between us. It’s been really important to get face-to-face because we want to have a good relationship with them, because they’re a crucial part of our team.
But when we are all sitting together in person, we spend time socially; we go for drinks, we go for dinner together. So we build a really good relationship wherever we can. And then, when we are apart, we have the right processes in place.
We spend a lot of time on video calls to ensure there’s a closeness. There are always good methods in that every time there’s a new release on the platform, some of them, the tech team will actually showcase that right through to the product team and then ultimately me and the commercial people in the business so that everyone has a good understanding of what’s being built, why it’s being built, and where the value is for our customers.
So there are lots of things we’ve done to overcome some of the cons of having a long-distance relationship, shall we say, and nothing that can’t be overcome.
Alex Antonuk:
— Yes, that’s true. Face-to-face communication, when you can just meet offline and talk to team members, is a really good opportunity. This applies not only to remote teams but also to situations when people work remotely while living even in the same city.
Jack Mangnall:
— Yes, I completely agree.
Alex Antonuk:
— Okay. So, and one more thing I think is worth asking. I know some companies run into bureaucratic obstacles when hiring in Estonia. At some point, they start wondering whether they should open a legal entity there to stay compliant with local labor laws for their remote teams. Have you encountered the same or other formal costs tied to these models that are worth highlighting here?
Jack Mangnall:
— No, we found it pretty straightforward to contract using our UK entity with the Estonian entity, that’s Bamboo, not seeing any big barriers.
I would encourage any UK-based startups to at least consider Estonian-based technology companies, give them the chance, let them prove what they’re capable of. One thing I think it’s worth calling out, though, for those UK startups, that if you’re planning to use R&D tax relief or if you’re looking to raise funding through grants, it is becoming increasingly difficult because in the UK, they’re looking for companies like us to rely on UK-based development companies or our own in-house resource.
So it is getting a little bit harder to look overseas. But ultimately, if you have the money, definitely consider Estonia.
Alex Antonuk:
— Okay, and to wrap up. If a UK startup founder were considering working not just with an Estonian team but with any foreign team, what business and technical questions would you suggest they ask first?
Jack Mangnall:
— I think it’s less about asking questions. I think you need to share your vision of what you’re trying to achieve and let that company come back to you, give them time to understand that, and present to you based on what they’ve learned from that initial sales process, I guess.
And if they start just pitching to you, and this stuff’s obvious, but if they start pitching to you just about rate cards before they even take the time to understand what it is you’re trying to achieve in your startup, it’s probably not going to end well.
So, find the people, find the company that take time to understand your mission, your purpose. And also believe in it. I think you want that development team, especially if it’s going to be a dedicated team, you want them to really believe in that mission, to see where that business is going.
So, it’s less of a technical answer and more of a finding the right fit between two companies. Make sure they understand what it is you’re trying to achieve. And, certainly, before you start parting with your higher cash, make them prove themselves because I think the right companies are really happy to do that.
Alex Antonuk:
— Yeah, I would agree with you in terms of that nowadays, a development company – there is not enough to just have people who will write code. They need to share at least the same values. They need to understand the product, be proactive in some cases, and suggest some features if possible. So more of a product vision approach than just coding.
Jack Mangnall:
— Absolutely, yes.
Alex Antonuk:
— Okay, Jack, thanks so much for joining us today and sharing your perspective. Grounded, honest, and genuinely insightful!
Jack Mangnall:
— Thank you very much. It’s a pleasure to be here. Thanks for the invite!