2015.01.01 The Entrepreneurial Scandinavia

Silicon Valley has had a "magic" sound to Scandinavian entrepreneurs for decades.

The Valley has had something that the Scandinavian countries didn't supply:

  • A huge home market.
    Each of the Scandinavian countries have 5-10 mill people. Even added together that is only 20 mill people+ compared to USA's 300 mill+.
  • Access to capital.
    For the longest time, Angel Investors and Venture Capital was unavailable to Scandinavian entrepreneurs. If you wanted to grow a company faster than you could fund through the "friends and family network" you were left to putting your house up as collateral. Funding through equity hardly existed.

Those were the bad old days. Now so many Scandinavian originated start ups have been successful that angel investors do exist and American companies and VCs have learned to look outside USA for new technology.

All three capitals and countries have lately been honorably mentioned as noteworthy places to start companies:

This article on Oslo promotes Norway as a great place to get creative juices going. Pros and cons seem to include the rich country side around Oslo: Enjoy it but expect that your employees want to enjoy it, too.

Sweden was promoted as totally overrepresented when it came to where venture capital was flowing in Europe as well as having new companies valued at over $1B - hitting well above their weight for the size of the country.

And finally this Forbes article promoted Denmark as the best country for conducting business.

It is noteworthy to look at the reasons why the Scandinavian countries are mentioned regularly in this context. One reason is the flexsecurity systems that unlike many other European countries makes it relatively easy to adjust the labor force. Another is the high level of education. A third is the level of engagement in the work force. More general factors are reliable infrastructure, stabile governments, and low levels of corruption.

In short, the Scandinavian countries have somehow succeeded at establishing societies that work.

Thus it was encouraging to see that the Danish prime minister in her New Year greeting to the nation focusing on maintaining and strengthening exactly the parts of society that can keep the country on this path.

The ironic thing is that one of the underlying forces to have contributed to this bliss is the reviled Jante-lagen, the culture of not believing that you are better than anybody else - or at least not to show it.

It will be interesting to observe how the improved climate for entrepreneurship can play along with values where it is not socially acceptable to flaunt your wealth. Will Scandinavian success stories result in ostentatious consumption as indicated in the article on Sweden, will we see small "Warren Buffets" putting their wealth towards public service, or will the Scandinavian countries also in this area find a third way uniquely Nordic?

To all Scandinavian entrepreneurs home or abroad: Happy New Year. Keep believing that you are somebody. And that others are worthy, too.