Russia’s full-scale invasion of Ukraine has created for Latvia not only a serious challenge in expanding military capabilities, but also the necessary conditions for our military industry to develop rapidly. The company Belss and its owner Tālis Ziediņš seem to have been the best prepared for this turning point and are now reaping the fruits of 30 years of work.
At the moment, Belss and its partner Eraser are involved in international supply chains with drones worth several tens of millions of euros. Thousands of drones must be delivered to the customer. The company has also been chosen as a cooperation partner for the production of the infantry fighting vehicle Hunter by the Spanish company GDELS Santa Barbara Sistemas – Belss will carry out equipment assembly and testing and, after delivery to the Latvian Armed Forces, will ensure maintenance and repair of the entrusted components. The fact that both the Ministry of Defence and NATO allies trust the company has also been recognized by banks – in September, so that the company could successfully fulfill the received orders, Luminor Bank granted it 7 million euros in financing. The credit line will allow the company to maintain financial flexibility while working on the development of unmanned platforms, on defence sector infrastructure projects, and on other strategic projects related to national defence.
How much time, work, and resources have been invested during the company’s 30 years of existence to reach such a level of competence and gain the trust of the state and its allies is something Ziediņš is reluctant to talk about. “Both I and the organization focus on tomorrow,” says Ziediņš.
The origins of SIA Belss can be traced back to the agro-firm Tēvzeme in Mārupe municipality. “Essentially, it was a kolkhoz, a relatively good kolkhoz with many auxiliary productions that supported the farm’s economy,” says Ziediņš. One of these auxiliary enterprises, in the creation of which Ziediņš also took part, was Agroelektro, which supplied kolkhozes across Latvia with Bulgarian radio stations.
With the restoration of the independence of the Latvian state, attacks began on the newly established Latvian state customs posts and state institutions, people were terrorized, and various provocations were organized. This created the need to form a popular self-defence organization, and in August 1991 the decision was taken to establish the National Guard of the Republic of Latvia. Naturally, the newly created organization needed communications equipment, which was provided by Ziediņš’s company. “We delivered all of their first radios,” says Ziediņš, who himself has never served in the National Guard – the guardsmen had known him since Soviet kolkhoz times.
As he developed his business, Ziediņš also became the representative of Motorola in Latvia and began supplying the security services of the newly independent state with radios and radio stations from this company. “We didn’t yet have a classic army at that time,” says Ziediņš.
Over time, a logical need arose to establish a company, and thus Belss was registered in December 1994. “There used to be a famous American communications company called Belss Lab,” explains Ziediņš, saying that when choosing a name for the new company, they tried to create associations with telecommunications.
Lursoft data show that initially the largest owner of Belss was Lithuanian citizen Aleksas Beliūnas, while Ziediņš owned only 0.99% of the company, worth 395.56 euros.
Belss traded radios, telephone exchanges, telecommunications equipment and also installed them. At the beginning they also tried to design and manufacture something themselves, but then dropped this idea. “From today’s perspective, those were just typical nineties experiments,” says Ziediņš.
According to information compiled by Lursoft, in its first full year of operation (1995) Belss achieved a turnover of 142,113 lats (206,259 euros at the 1994 Bank of Latvia exchange rate) and a profit of 20,102 lats (29,175 euros). According to the Official Statistics Portal, the average net wage at that time was 97 euros. In this year, Ziediņš bought a little more than 30% of the company’s shares from his partner, and in 2001 he bought all the remaining shares and is still the sole owner.
Asked how he and the company survived the turbulent nineties – when many successful entrepreneurs lost not only their money but also their lives – and whether his ties with the National Guard helped, Ziediņš says: “The nineties were the nineties – with their own peculiarities, but I didn’t need a ‘roof’ [criminal protection]. We operated in a relatively specific niche and didn’t take radios out onto the open market.”
The company started as a communications business, and this business component is still essential for it. Belss is the official representative of Motorola and Silvus Technologies. The right to officially represent Motorola is a strong trump card for Ziediņš’s company – by invoking these rights, the company has repeatedly succeeded in having the results of already completed tenders for the supply of Motorola radios and their components to the Ministry of Defence and the Ministry of the Interior annulled.
In parallel, construction and design activities were also developed. Initially this concerned only communications, for example, the construction of mobile communication masts. Gradually, this business branch expanded, and now Belss is actively involved in the construction of bases for allied forces stationed in Latvia, as well as in the design and construction of civilian facilities.
Rapid expansion into construction has also brought the company some trouble. Thus in 2013 the Competition Council decided to fine Belss and Jaunmāja for a prohibited agreement. Ziediņš’s company had to pay a fine of 43.63 thousand lats (62.07 thousand euros).
Belss and Jaunmāja had coordinated their bids for a procurement by the State Defence Military Object and Procurement Centre, which concerned the design of the first-phase technical project and author supervision for the reconstruction of the National Armed Forces base in Jēkabpils.
The company was also drawn into a minor scandal in 2017, when the media suggested that the Ministry of Defence, with which Belss had already worked for many years, had a particularly warm attitude towards this company. It was reported that the then Defence Minister Raimonds Bergmanis’s (ZZS) advisor on logistics issues, Jānis Zablovskis (ZZS), had facilitated the inclusion in the Ministry of Defence delegation to a defence and security exhibition in Canada of only one company representative – from Belss. At the time, Ziediņš said that as a result of this trip Belss obtained an order worth 300,000 euros, namely a modular building that was later used by Canadian army units in Latvia. Now the company says that no orders resulted from this trip. The first contract with the Canadian Army (Defence Construction Canada) after a tender was reportedly signed in 2022 and implemented in 2023. The situation was made even more awkward by the fact that shortly before leaving for the exhibition, Ziediņš donated 24.9 thousand euros to the Latvian Green Party and the Union of Greens and Farmers. Ziediņš categorically rejected all accusations at the time, stating that the “facts disseminated by the media are not correctly reflected and create unfounded doubts about both Belss and the work of the Ministry of Defence of the Republic of Latvia. In fact, participation in the CANSEC 2017 exhibition in Canada took place precisely at the initiative of Belss, not with support from officials of the Ministry of Defence of the Republic of Latvia.” Now he adds: “Unfortunately, in Latvia we can often observe that local companies are drawn into political disputes even though the companies themselves have nothing to do with the situation – you just happen to be in the wrong place at the wrong time, like a passer-by who gets injured in a street brawl between rival gangs.”
The minister’s advisor lost his position after this scandal, and the owner of Belss has not donated to parties since. “Those whom we see as somewhat like-minded already receive quite generous state funding,” says Ziediņš. But Belss continues its successful cooperation with the Ministry of Defence, strengthening its reputation as the largest military integrator in the Baltics. Another integration project of which Belss is proud is the reconstruction of Latvia’s mine countermeasure vessels. In this 20-million-euro project, the Latvian company is working with a French firm that supplies modern equipment for mine detection. Belss specialists integrate it into our ships. The company also designs and installs mobile military camps for the Latvian Army and NATO allies.
In 2019 the company signed a contract with the NATO Support and Procurement Agency to supply mobile camp systems and equipment worth a total of 6.268 million euros. This and subsequent contracts were largely possible because Belss was the first company in Latvia’s military industry to obtain the AQAP (NATO Quality Assurance Requirements) certificate.
AQAP are quality assurance system standards developed by NATO. The AQAP certificate is proof that a company meets quality management requirements for supplying the defence industry, particularly to NATO and similar organizations.
When Russia launched its full-scale invasion of Ukraine, Belss, its owner and management saw growth potential in drones. “In 2022 or 2023 we started focusing on drones – we distributed drones from the most famous Chinese company, including to Ukraine, to military personnel who are drone enthusiasts, but not in any serious volume.”
Belss realized that, as events developed, Chinese drones might not be enough. In addition, the company received reports that commercial Chinese drones were not really suitable for Ukrainians, and it decided to develop its own research and drone manufacturing capabilities.
Of course, such a plan would benefit greatly from state support, and Belss went to the Ministry of Defence with its vision for drone development. At that time – at the beginning of 2023 – the Ministry of Defence did not find the Belss vision particularly interesting, so the company invested a significant amount of its own funds. At the beginning of 2024, the first Belss drone took to the air.
When the Drone Coalition was created in February 2024, Belss invested in its products to adapt them specifically to the needs of Ukraine’s defenders. “When the Drone Coalition started to take shape, we spent our own resources; within the framework of the [Defence] Ministry’s Drone Coalition we received descriptions of Ukraine’s needs and worked with them. The processes were seemingly moving upward, with sufficiently large production volumes being promised, but life is very diverse,” says Ziediņš, indirectly indicating that hopes for large production volumes were not fulfilled. In 2024 Belss ended the year with a turnover of 18.39 million euros and a profit of 1.26 million euros. Although the company’s turnover fell by around 400 thousand euros compared to 2023, its profit increased by about 200 thousand euros. It is expected that this year – 2025 – will be one of the most successful in the history of Belss.
While developing drone production, Belss established a new company, Eraser, in mid-2024; Ziediņš directly owns 42% of its shares, and a further 6% through Belss. The remaining shares belong to company employees whose enthusiasm has made this line of business a reality. “The people running the company are highly enthusiastic about drone research, development, and production, and they must be co-owners in the company – that is only normal and logical,” says Ziediņš. The wider public was only informed about Eraser this May, even though the company had already been operating for six months and managed to complete 2024 with a profit of 27.77 thousand euros – with profitability exceeding 50%.
Although he is reluctant, Ziediņš did reveal the funds invested in the drone factory, but he values much more highly the people who have invested their knowledge. “Eraser has the potential to become larger and more profitable, but that is potential. Potential is determined by the people who work in the company, and there are truly talented engineers working there, world-class athletes who know their field,” says Ziediņš.
He is convinced that only someone who has been passionate about robotics, drone construction and piloting since childhood can become a truly outstanding drone developer. “Our leading specialists come from robotics clubs and schools where there are practical lessons. Some of our colleagues have grown up in these clubs and now work as leading specialists.” There is no reason to doubt his view – last year specialists from Belss and Eraser were, among 260 companies worldwide, one of only five teams whose drones were recognized as good enough to be sent to Ukraine.
The company has now developed 10 drone models capable of carrying out reconnaissance or strike missions. There is also a drone that does not require radio communications for control – it is connected to the pilot by an optical fiber cable. Interestingly, even a 25-kilometre-long cable spool weighs only about a kilogram. In addition, drones are becoming increasingly smart. “That is the challenge. A drone can now identify a target at a distance of one and a half kilometres and fly to it (..); when we talk about strike drones, the ‘destroy’ command is given by a human – the drone itself cannot choose a target.”
Like most companies, one of the challenges Belss is trying to tackle with its own resources is the shortage of workers. As production capacity has increased, the number of employees has grown significantly in a year and a half, and around 50 people now work in the company – but more are needed. Belss tries to train new employees in-house, yet in order to develop the company’s operations purposefully, it also attracts professionals already present in the labour market, while it takes care of the new generation of engineers at the Riga Technical Creativity Center “Anna 2”.
The second problem is the extremely slow processes that must be overcome before an order is finally received. “What irritates us is the slowness of processes,” Ziediņš admits. When taking part in a tender, the first phase is very fast – literally within two months a drone that meets the required specifications has to be ready. “There is one fast stage in which an entrepreneur, using his own money, must very quickly create a prototype. If the developed prototype is recognized as good, the purchasing process begins, and this sometimes lasts for months with no fixed deadline. We have no experience of it happening quickly.”
As far as can be inferred from what Ziediņš says, he is somewhat disappointed that the domestic armed forces are not very active in purchasing his products. “In working with Eraser, we count on state support, because armaments are a state prerogative; we will not sell them to private armies,” says Ziediņš. Still, state interest in the development of the local drone industry and in ensuring the security of supply chains is growing and consolidating, as evidenced by the recently established Autonomous Systems Competence Centre.
He emphasizes that stable orders not only make the entrepreneur’s daily life easier but also provide opportunities to develop new drone models, to grow, and to seek new solutions. “To maintain production, we need a certain stability. As soon as we have no orders, we have a headache – what to do with colleagues working in production. It is easier with those who work in research and development – if necessary, they can join the production side. The opposite does not work.”
However, responding to new challenges is the modus operandi of Belss. Every new contract is also new experience – whether it is modernization of mine hunters, the design of mobile military camps, or the assembly and maintenance of combat vehicle equipment.
Originally published at https://inc-baltics.com/kars-ukraina-ne-tikai-posts-bet-ari-biznesa-izdeviba/
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