How Denmark can re-establish itself as top tech hub
Increased access to risk capital, better education, and sustainable integration may be the way forward!
In recent news, Copenhagen moves down the list global tech hubs from #7 to #10, being overtaken by Stockholm, Boston and Singapore. With a few tweaks, Copenhagen could re-establish itself towards the top of the list next year. The parameters for judging the list include housing prices, access to capital, talent supply, "city buzz" and wellness.
For many years, Copenhagen has been one of the cities in the world with highest quality of living, so it begs the question: what can we do better in order to foster innovation in technology in Denmark?
According to Danish minister for Higher Education and Science, Tommy Ahlers, what we need is to educate more IT-talents, increased access to capital, and encouraging more to embrace entrepreneurship.
Denmark is famous for advancements in the fields of robotics, acoustics and cryptography, as well as progressive focus in digitisation of the public sector, IT adaption in businesses and support for entrepreneurial innovation, which has lead to a strong tech scene in Copenhagen. With numerous global successes to boast, including Skype, Trustpilot, JustEat and Tradeshift, it comes as a surprise to some that Copenhagen's ranking on the global list of tech hubs is decreasing.
One of the major challenges for Denmark is producing enough attractive jobs for both the newly educated tech talents coming out of Danish universities, but also attracting foreign talent. In terms of alternatives, cities in the United States, like San Francisco and New York, may provide more attractive career opportunities for talents entering the job market. It's estimated that the five Danish "unicorns" have created more than 14.000 jobs, although only 700 of those jobs are in Denmark, in light of high operational costs.
It’s easy to get started in Denmark, but it becomes difficult to keep going. Our public systems are so digital that we have the means to easily register as businesses, but in the long run, we may face difficulties in finding talent locally and keeping expenses low. — Jack Nikogosian, ARYZE CEO
Furthermore, while Denmark is home to many R&D centers for major companies, like IBM, Google, Microsoft, Intel and Accelink, the struggle of becoming integrated into Danish society is a challenge that many might shy away from. It must be alleviated by attractive conditions that are executed through positive economic and foreign policy.
As Ahlers remarks, another challenge lies in the lack of readily available risk capital for investments into budding startups.
We completed a funding round of $1.6 million USD from Denmark, but the access to risk capital was quite a struggle; finding Danish investors who understood the need for tech like ours was an up-hill battle. — Carl Jenster, ARYZE Co-Founder
Copenhagen is home to a number of organizations that support startups, both publicly and privately funded. Among those is Copenhagen Fintech Lab, which is doing a fine job in building bridges to other international hubs, lending a hand in networking for partners and investors.
Another great programme for aiding startups in mentorship and networking is InnoFounder, which offers grants to help founders get started. More public support to these types of organizations will increase vital resources that allow Danish founders to stay within the Danish borders.
The education of IT and entrepreneurial talent is something that should very much be in focus for the next generation of students.
"We see great value in teaching our local student communities how to become entrepreneurs and innovate on traditional systems. These are the young minds that will shape the future and decide what sticks and what doesn't in the years to come." — Carl Jenster, ARYZE Co-Founder
Danish schools must be better at encouraging young students to dare to become entrepreneurs and IT specialists; fields that are both respected and attractive. They must also be better assisting researchers in implementing their ideas in startups.
Denmark has a place among the top of the list of tech hubs in the world, but it will require hard work and dedication to get there (and stay there).