Freezing conditions and cool investments: in search of the Nordic unicorns.

Aside from endless jokes about Northerly winds and meatballs, the Nordic has one of the most exciting landscapes to offer — geographically, culturally and business-wise. As the office Scandi, I’m pleased to say Wellington Partners has made over half a dozen early stage investments in the Nordics, across Sweden and Finland. And we’re on the lookout for more because if the answer to ‘where are you based?’ is the Nordics, you can guarantee a couple of things (not that I’m biased)…

• International from day one

When you think of Spotify, do you think of a Scandinavian corporation? No, because it’s an international business. Why? Well first, the internet. Today’s successes will be global from day one. But second, Spotify started out thinking international. From Nordic beginnings, the emphasis isn’t on going global at some point but serving the international market from the off.

• English speakers

Sounds simple but excellent English communications skills are integral to education here. This contributes to the international approach for startups — it all starts with a conversation right? 80% of kids are near fluent in English by adulthood. Because English is everywhere. A lot of the popular culture comes from the US and UK. And there’s no terrible movie dubbing (only the more educational subtitles). We’re also nations of travellers.

• High Engineering Skills and flair for UI/UX design

The Nordic countries produce some of the top talent in this area, keeping them constantly relevant to tech. Don’t believe me? Ask anyone working in this space.

• Business culture

A unique combination of openness yet straightforward thinking are winning ingredients here. Probably the most famous example comes from IKEA founder, Ingvar Kamprad, who’s invention of flatpack furniture solved shop stock storage and transportation issues keeping costs down easing the strain on the consumer’s pocket.

• Progressive thinking

The Nordics have a very cool attitude to equality that has a real businesses benefit — diversified teams. — For example, to make sure kids get equal mum and dad time, fathers in Sweden are encouraged to take 2 months paternity leave. This is the most generous paternity law in the world. One of the most famous storybooks featuring a female protagonist is Pippi Longstocking. Pippi originates from Sweden, and features a 9 year old girl with superhuman strength. Sweden has one of the highest employment rates in the world for women. Denmark has a female prime minister, and Victoria, the crown princess of Sweden, studied at Yale and worked as a diplomat. In the global Gender Gap Report of 2013, Finland came 2nd, Norway third, Sweden 4th and Denmark came 7th. In short, equality is a very simple but very important to the startup culture.

• Mature venture landscape.

The glue is a venture ecosystem that’s mature, connected and experienced. There’s a long tradition of early successes, creating global tech leaders (Ericsson, Nokia make up a history of tech, more recently look no further than Spotify) and an ecosystem which is full of the exact thing startups need — experience. Role models and their war stories are such an important part of the picture.

Disproportionate to its size, here’s a region which has all the ingredients to build great global companies, and long may it continue!

A quick look at Wellington Partner’s investments in this geography so far:

• Soundtrack Your Brand

The Spotify spin-off is taking data to music and optimising playlists for business. Visiting a McDonald’s in Sweden? Listen out for a soundtrack. https://www.soundtrackyourbrand.com/blog/mcdonalds

• LiveBookings

The rest of the world may be a bit slow to catch up on the delights of meatballs, salted cod and Reindeer meat, but that didn’t stop the founders of LiveBookings in January 2005. Now known as “BookaTable”, the service seamlessly organises bookings for over 10,000 restaurant in 23 countries, making it Europe’s largest online marketing and reservations service.

• Ztory

Sweden are quickly becoming the king of subscription services. First Spotify gave us music streaming, now Ztory are heading in a similar direction for digitised magazines. Distributing nearly 500 titles and 7,000 publications, their service offers a great selection for an affordable SEK 99 (€10.70) per month.

• Nosto

Nosto (the Greek word for “homecoming”) is a Finnish start-up rocking the boat in the e-commerce world. They have developed a cloud-based big data SaaS solution (patent pending) that enables online retailers to deliver a personalised shopping experience to individual customers based on their unique user behaviour. Also our first investment in Finland.

• Spotify

Launched in October 2008, Swedish born Spotify brought legal online streaming to the masses — much like their fellow countrymen at IKEA did for flat packed furniture and Volvo in providing the middle class with the safest mode of transport. Now with over 40million users globally, and a quarter of them registered to premium features, Spotify’s future looks like they’ll be flying the flag for Swedish business for some time.

• Glo

Swedish based Glo creates LED products using nanotechnology. The technology sidesteps the technical limitations of current LED. It allows for the creation of highly efficient, stable and ultimately unique red, green, blue (RGB) emitters out of one material system.

Know the next Nordic Unicorn? We’ll be at SLUSH all this week. Find me on Twitter! @LDahg