Next Silicon Valleys: Small Estonia has big ideas

Estonia may be tiny but in tech terms it's a giant. It has a population of just 1.3 million, yet produces more start-ups per head than any other country in Europe.

In the third instalment of our Next Silicon Valleys series, Nigel Cassidy visits to see how the Baltic nation compares with its Californian counterpart.

Right on the edge of Europe, halfway between Stockholm and St Petersburg, the tech-savvy country that launched Skype a decade ago continues to be a hotbed of entrepreneurs and innovation.

The start-up community in the small nation, dubbed the #EstonianMafia on Twitter, has been gaining visibility globally.

Examples of tech companies to come out of Estonia include Fitsme, external, a virtual fitting room for online clothing retailers, now in 16 countries, and Creative Mobile, external - a company creating free-to-play games for mobile platforms.

Playtech, external, one of the world's biggest providers of online gambling software, was founded in Estonia 15 years ago and is now listed on the London Stock Exchange with a value of around £2bn.

Now a bunch of entrepreneurs and engineers working overtime in modest workshops in the capital, Tallinn, are months away from launching products to revolutionise transport - and guitar-playing.

Stigobike, external - a nifty unfolding scooter, designed for city commuting - is hailed the fastest folding electric scooter in the world.

It weighs just over 15kg (33lb), has a range of 40km (25 miles) for each charge of its onboard lithium battery - and a top speed of 27km/h.

A new design substitutes aluminium for carbon fibre. It has a simple two-step opening and closing mechanism that allows the pint-sized scooter to fold up and stand securely, yet with a footprint no larger than a shoebox.

"It's true we don't have traffic jams or commuting problems here in Tallinn, but our team travel a lot, and the idea was born when we saw the difficulties commuters face in international capitals. And only now has the battery technology became available," says Stigobike chief executive Rando Pikner.

The inventors envisage the bike, which will cost about 1,900 euros (£1,500), being ridden right up to airport check-in desks, railway ticket gates, or around large buildings.

With safety concerns as they are, the main hurdle could be getting EU authorities to approve the design as street-legal - let alone pavement-legal.

It seems unlikely that all the company's dreams will be realised - in Europe at least.

Another Estonian invention - the electronic Spicetone, external control box - is aimed at competent guitar players. The control box, or effect pedal, is plugged between guitar and amplifier.

Until now, devices of its kind have been mono, picking up signals from all the strings together and processing the sound on one channel.

But the Spicetone box is polyphonic - it can process the sound of each string individually. This allows an electric guitar to be played using the techniques familiar to acoustic players.

The output of all six channels is processed separately, with the facility to control distortion, modulation and overdrive, and to add many other customised effects.

Noted Tallinn guitar player Janek Kesselmann demonstrates the new device, filling the room with loud yet subtle and undistorted sound - high harmonics and all.

"I like it because I can play in the same style as I would on an acoustic guitar, yet fill an entire concert hall with sound," he says. "Otherwise, to play electric, I would have to change my technique and the sound would be very different."

Spicetone's prime mover, Rain Sabolotne, is proudly an analog man who began building his deep knowledge of integrated circuits in the Soviet era.

He doesn't play guitar himself but knows a lot about processing sound.

"A guitar in its nature is a polyphonic instrument. Yet for several reasons, including cost, you lose all the polyphony," he says. "After a lifetime in electronics, I felt you could do a lot more things to the sound, and now we are finishing the design I hope it will also turn out to be a good business decision."

But will Spicetone find any customers?

London guitarist Greg Michalik runs Guitar Aid, an independent business specialising in guitar repair and modification. He says there are already some polyphonic (or hexaphonic) pickups on the market, but they all have a different combination of coils and components.

"Basic designs have changed little since the 1950s and 1960s, so there is always room for fresh ideas," he says.

"It would be good to see something new, but one problem is that serious guitar players are conservative and tend to be sceptical about experimenting with niche ideas if they are too expensive."

Estonia, with its tiny population, has to think beyond its borders and look abroad to sell ideas like these.

But it is also coming to terms with the realisation that many of its best new ideas will end up overseas as successful start-up entrepreneurs move to be nearer their markets.