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Nordic startups could gain the international links and skills required to grow following the launch of a private sector network which sets out to help them do just this.
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The Nordic and Baltic countries are on the up. Successes such as Skype, Spotify, Supercell Transferwise and Zendesk have given the regions a strong reputation as technology startup hubs. But a vibrant startup scene on its own is not enough to foster growth, and this is the kind of challenge that recently launched private-led and not-for-profit network Tech Nordic Advocates (TNA) wants to address.
“The Nordics and Baltics are already on the world’s technology radar. Technology is the fastest growing industry sector across the region, but the sector is fragmented,” said TNA founder Jeanette Carlsson at the network’s launch event in Copenhagen on 4 November 2015.
To tackle this, TNA is taking the first steps to build a common tech network between Nordic and Baltic countries. So far, some 100 tech industry experts, entrepreneurs and investors from both the private and public sectors have signed up as members, known as advocates.
The duties of advocates include helping startups and scale-ups find new partnerships, talent and investment. A key element is networking to bring established companies and startups together. At the launch event, TNA announced 12 working groups. Led by advocates, the groups come together every few months to discuss and take action on the regions’ specific issues and needs.
Groups for financial technology (fintech), digital skills and startup-related topics have gained notable traction, and TNA expects to have 12 groups – to include clean and green technology, women in technology and smart cities – ready for its first events in early 2016.
“We are a network and a community and we project our voice out to the media. But we also get things done at the grassroots level,” explained TLA founder Russ Shaw. “For example, we have a programme with [the UK Home Office] called Home Office Hours where we bring the Home Office into the startup community to give free advice on immigration policies.”
A recent success for TLA’s immigration group has been helping to get digital and technology jobs added to the UK’s shortage occupation list in February 2015, which makes it easier for companies to recruit IT talent from overseas. It is these kinds of initiatives TNA hopes to replicate across the Nordics and Baltics.
Small market challenges
Tech Nordic Advocates launches at a good time. The European Digital City index (EDCi) lists Nordic capitals Stockholm, Helsinki and Copenhagen in the top five EU cities for how they support digital startups and scale-ups, while London took top spot. The Baltics fared less well, with Estonian capital Tallinn ranked 20th.
But practical challenges remain. At the TNA launch, a panel of Nordic tech experts pointed out the regions suffer as a result of the small home markets. Even the largest of the bunch, Sweden, has a population of under 10 million. They also said the region lacks internationalisation expertise and has a limited talent pool.
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“The Nordic market is too small for Nordic startups. They have to scale internationally and go global almost from day one to succeed,” said Mikael von Dorrien, senior advisor at Nordic Innovation, a state-funded institution which promotes trade and cross-border innovation between Nordic countries. “We have great programmers and engineers, but there is a lack of talent in taking the companies out to the international market.”
Mathias Thomsen, general manager at Uber Denmark, told Computer Weekly he has first-hand experience with the shortage of tech talent to meet the growing needs of the region. Uber is looking to hire up to 100 software engineers for its Danish development team in Århus, but Thomsen said it hasn’t been easy. He hopes organisations such as TNA will help to increase the awareness of opportunities offered by tech companies.
Steps towards collaboration
So how will TNA meet such a wide array of challenges? Its first step will be to capitalise on TLA to connect Nordic and Baltic companies more closely with the blossoming UK tech scene.
“Of course, there are a lot of [local Nordic tech communities and programmes], but startups especially need international connections to scale and go international,” said Nordic Innovation’s von Dorrien.
TNA also hopes to mirror the success of TLA’s largest working group, Women in Tech. Grant Thornton’s 2015 annual International business report stated only 6%, 4% and 3% of CIOs are women in Finland, Norway and Sweden respectively, and improving the involvement of women in all areas of tech is a fundamental way of improving current talent shortages.
“There is certainly no shortage of ideas and innovation – the shortage is in people. We simply don’t have enough digital talent to grow these businesses,” said TLA advocate Jacqueline de Rojas, who is president of techUK and vice-president of Citrix Northern Europe. “This is where we need to look towards alternative talent pools and shine a light on diversity. I hope we can attract more women to the tech sector,” she told Computer Weekly.
TNA is also in discussions with the Nordic Startup Conference, an annual Danish event which connects Nordic startups and investors, and plans to organise its first major event in conjunction with the conference in March 2016.
“Since 2014, four unicorns [startup companies valued at $1bn or more] have grown and moved out from the Nordics and Baltics. When we look at the UK, it has had 10, so you aren’t really doing badly here,” said de Rojas.
But here lies the aim of TNA in a nutshell: Taking “not bad” and turning it into “exceptional”.