I’m on my way home from the annual Nordic venture conference, called “Slush”. Some say the name refers to Helsinki’s November weather, which was indeed cold, gray, and wet, but it did not quite snow. The Finns just joke about their weather and focus their energy on business and hospitality.
Slush quickly convinced me that the Nordics have something going in entrepreneurship. They have highly educated and industrious populations, but they need to create jobs for young people in a stagnant European economy. They see the success of the U.S., China, and Israel building new businesses. And they have the global outlook of small countries: foreign markets are a necessity and English is spoken everywhere.
Two recent changes create a tipping point for growth of the venture ecosystem. Society and government have made a commitment to entrepreneurship and accepted its downside risks. Failure is seen as more a learning experience, less as a mark of shame, than in the past. Every large city has an incubator or accelerator. Government from the European Union down has programs to increase the supply of risk capital. And the Nordics have experienced enough success with start-ups to have the kernel of an ecosystem: success examples, role models, business angels, a VC community. So 15,000 people came to a sold-out conference in Helsinki in November to build the momentum of Nordic entrepreneurship.
The Nordics have a distinctive style of entrepreneurship. The nine companies featured in Slush’s Nordic start-up showcase illustrate this:
- Enevo: demand-based waste management
- Spotify-Business: the sound track for your retail brand
- Acast: hosting, distribution, and monetization of podcasts
- Seriously: developer of Best Fiends, a new mobile game world
- Kahoot: gamified K-12 learning, with 20 million active students
- Beddit: a sleep quality tracker featured in the
Apple store - Zaneta: market transparency for global container shipment*
- Falcon Social: unified social media dashboard for global brands
- Fishbrain: #1 social app community for sport fishing, the world’s largest hobby (3x bigger than golf)
Several investors called the Nordic region Silicon Valley for gaming: home to Rovio, SuperCell, and King, etc. Two of the nine companies do gaming. The Nordics are also strong in digital/mobile/social media. Acast, Falcon Social, and Spotify-Business, which is a spin-off from Sweden’s Spotify (and from Beats) are in this space.
The other companies have a vertical focus: waste management, container shipping, sleep sensing, and sport fishing. These companies tap deep expertise in the region, build a strong product, and take it global, developing a market leadership position. Global dominance of substantial niche markets is in the Nordic DNA, as shown by the success since World War II of Nordic technical companies in areas such as paper-making machinery (where the Finns lead), dairy automation (Swedes), etc.
Nordic companies are even developing electric vehicles: Toroidion has a super car and ambition to win the LeMans race; Candela has an electric hydro-foil speedboat.
Estonia, a near-neighbor to Finland, had the most interesting story. Taavi Kotka, the CIO of the Estonian Government, described Estonia’s program to turn itself into a virtual country, which they call “e-Estonia”. Taavi is a witty, energetic, and engaging man who, however, looks a bit like Vladimir Putin.
He explained, with tongue a bit in cheek, that Estonia with 1.3 million people can never hope to become really big country, like, say, Sweden. There is no immigration because no one wants to come: Estonia lies at 59º north and has no social benefits! They hope the EU will send them some Syrians.
So they will grow by making the country virtual. They offer e-residency as a platform: a strong digital identity from the Estonian government that is usable throughout Europe. A wide range of services can be provided virtually if all the participants have a strong digital identity, e.g., Estonians have been able to vote on the Internet for ten years. Estonia will be a hassle-free country for digital commerce, like Delaware is for corporate organization in the U.S. So, Tavi says, welcome to Estonia: the world’s largest country, with only 1.3m physical residents.
The very cool after party was still ramping up when I retired at midnight, reflecting the energy that the Nordics have for entrepreneurship, and perhaps also free beer in a country where alcohol is heavily taxed.
One of the presenters summed up my sense of the Nordic venture environment very well. “The Nordic states are a strong region for entrepreneurship. In Silicon Valley it’s about jumping to the next rocket ship as fast as possible -- they are very good at sprinkling stardust. [Here] it’s about great teams building great products."
