05 May EuroTrip // A journey through Europe’s Startup Scene: Sweden
Let’s continue our European startups landscape tour with Sweden and Stockholm! Välkomna
Not only does Sweden have some of the most reputable unicorn names, but they have also become a key FinTech hub, recognised globally. Sweden is actually the second most prolific tech hub in the world on a per-capita basis. According to a recent report published by investment firm Atomico, Sweden has 6.3 billion-dollar companies per million people, compared to Silicon Valley’s 6.9.
In terms of funding, Swedish startups received over a billion dollars in investment in 2015, of which more than a quarter was dedicated to the FinTech scene, accounting for 18% of the total USD 1.5 billion FinTech investment across Europe. These investors include some of the biggest names in the industry, such as Sequoia, Accel, and Greylock, but also US Corporations such as Intel Capital, Mastercard Worldwide and American Express Ventures, who have invested in the Stockholm FinTech industry.
Firms and organizations in Sweden employ 592,000 individuals in high-tech areas. Let me tell you here that Sweden has a population of approximately 9.6m people. The Stockholm region alone employs 197,000 individuals in high-tech, and they have about 600 startups.
So who are the Swedish Unicorns?
• Skype – who hasn’t heard of Skype yet? Maybe just my aunties Helene and Gisele. They are both 83-years old and do not have internet yet, bless them…
• Spotify – Same question!? Same answer: Helene and Gisele.
• King – again, tell me that you have never tried Candy Crush or been invited to play Candy Crush at least once? You see…
• Klarna – a Swedish eCommerce company that provides payment services for online storefronts.
• Mojang – a Swedish video game developer founded in May 2009 under the name Mojang Specifications by game programmer Markus Persson. It’s best known for creating the popular independent game Minecraft, a sandbox game. Mojang is now owned by Microsoft.
And now to be more specific regarding the FinTech
• Klarna – to name them again
• iZettle – a mobile payments company
• Trustly – a payment method that allows you to pay with your online bank
• Bima Mobile – a leading provider of mobile-delivered insurance and health services in emerging markets
• KnCMiner – a bitcoin mining hardware manufacturer who produces cutting-edge ASIC miners
Here is our selection of co-working spaces in Stockholm
• Entrepreneurs Church: Tech co-working space in a former chapel
• Impact Hub: Tech co-working space
• Knackeriet: Co-working space for web, design and business
• Coffice: Café and co-working space
So how can you justify such a big success for such a small country? When did Sweden kick off their digital disruption?
Well, the Swedish government was fantastically visionary and embraced the technology and digital transformation from a very early stage, as early as the 90s. For example, they invested heavily in high-speed internet infrastructure, and they gave citizens tax breaks to buy computers. In addition, they facilitated working visas for skilled software engineers and developers. It’s not a surprise that the free file-sharing websites The Pirate Bay, Kazaa and uTorrent, were also founded in Sweden.
In addition to that, substantial social benefits reduce the risks faced by entrepreneurs and costs for companies, thus encouraging startup and innovation. Education for children is free, including university, and child care is heavily subsidised.
And what about the level of tax?
Businesses in Sweden only pay a national corporate tax based on yearly income. There is neither a local corporate tax nor any business license tax to be paid. Sweden has a low corporate tax rate of 26.3%. Possibilities to defer taxation of profit – by delegating up to 25%
What else Sweden has?
Abba of course, Saab, Volvo and Ikea. I’m actually glad that the names they are giving to their startups are not as complicated as the names they are giving to their furniture.
And finally, the money is the Kronor, not the Euro.
Next month, we will be travelling to Amsterdam.
See you next then!
Sophie Cohen has performed Global Executive Search for MitchelLake clients in Europe, North America and the Asia Pacific region. Currently based in our London office, Sophie specialises in senior executive talent for startup, global growth, market entry and digital transformation for some of the worlds most disruptive and dynamic brands.
Sophie Cohen is Head of Research and Delivery for the MitchelLake Group. She has over 15 years experience in executive search across various industries including industrial, pharmaceutical, finance and digital.
Sophie is a trained Psychologist and has lived and worked in France, the UK, the US and Australia. She speaks French and English fluently.