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Tampere’s perfect storm triggers a startup revolution

Previously a hub for Nokia and Microsoft, Finland’s second-largest city is capitalising on a wealth of technical knowhow to become the dark horse of the Nordic startup scene

In Finland, there is a concept called sisu, which reflects a mentality of resilience embedded in the country. In the city of Tampere, this “never give up” attitude complements a close-knit collaborative culture and renowned levels of tech innovation to make it arguably the Nordic region’s most exciting startup ecosystem.

The wider country’s reputation as a tech giant has leveraged this proactive mindset in parallel with an established penchant for gametech and a wealth of digital knowhow, courtesy of Nokia. The resultant impact on startup success has been especially telling in recent years.

Sami Puttonen is a project manager at Business Tampere, a 10-year-old local economic development agency that, for the past two years, has looked to leverage the city’s startup revolution via its Startup Tampere programme.

Looking back at the city’s development over the past five years, Puttonen said: “The startup scene in Finland has gradually been building for 10 years, but the Tampere scene really began five years ago, and in the past two years in particular, we have seen a burst of activity.

“The hype in Finland reached this city at a time when a host of skills were leaving Nokia and Microsoft four or five years ago, and that tied in with the general boom of entrepreneurship on a global scale.”

The impact of startup events such as Slush helped to ignite a culture of innovation from Helsinki to Tampere, resulting in an increase in available capital, more tailored national funding and support, local facilitators such as Business Tampere, and a growing number of success stories to inspire the next batch coming through.

Puttonen’s colleague, Business Tampere senior business adviser Oliver Hussey, added: “There’s an inside joke here in Finland that the country invented the internet of things [IoT] many years before the hype, but we just didn’t tell anyone about it.

“There are a lot of engineers who have been innovating in industry for 20 years or so, putting wireless communications within sawmills, for example, without realising they’d created the IoT. This epitomises the level of technical knowhow that exists here in Finland, even without the perfect storm of startup enablers that have come together more recently.”

Merging knowhow with culture

In part, that “perfect storm” alludes to the abovementioned technical and economic drivers. However, as demonstrated by Oliver’s IoT example, Tampere’s startup success strongly reflects both individual inclination and social culture.

Tampere Startup Hub is a new non-profit company founded by a coalition of serial entrepreneurs, founders and community builders. The organisation, as of October 2020, started operating under the banner of Platform6, which is the name of the new 4,000m2  startup facility looking to harness that perfect blend of individual culture and expertise.

COO and co-founder Alexandra Santos explained: “Close and open collaboration has been Tampere’s key differentiator in recent years. It’s been a community-driven evolution up until now, and that’s what Platform6 represents.

“We will be responsible for bringing together the best startup companies in the city, organising activities and facilitating their growth – all at a time when the angel investor scene is resurging and new ideas and models are being generated every day.”

Read more about startup hubs in Finland

Santos cited Wirepas, Framery and HappyOrNot as three companies that are inspiring future success stories. HappyOrNot agrees that this culture of collaboration strongly facilitated its own growth on the way to becoming one of the world’s most recognisable customer experience models.

“There is a truly supportive, humble and positive atmosphere within the Tampere ecosystem,” said HappyOrNot’s CEO and founder, Heikki Väänänen. “Across the board, there is such a willingness to help. That ethos then combines with the excellent Tampere University, which helps to provide a bedrock in marketing, sales, finance and business development, as well as Business Finland, which is also based here in Tampere.

“The latter government organisation’s 600 experts work in 40 offices around the world, alongside a host of incubators, regional offices and investors to make sure this local impetus translates into international opportunity.”

The Nokia and Microsoft effect

This combination of instinctive innovation and embedded support structures would be potent on its own. But there is no escaping the overriding impact that both Nokia and Microsoft have had on Tampere in recent years – contributing to its status as a world tech cluster for the IT, automotive and imaging industries, in particular.

Hussey said: “Ten years ago, this city and scene was dominated by big names, primarily Nokia. At its peak, the company employed more than 5,000 people. The slow release of talent as Nokia’s market influence diminished, compounded by the later shutdown of Microsoft’s mobile R&D site four years ago, unleashed a huge wealth of skills into the local ecosystem.”

A host of highly skilled, tech-minded individuals suddenly flooded the open market in search of new opportunities, new environments and an opportunity to flex innovation on their own terms.

Puttonen added: “All of a sudden, so many new startups appeared, many of which are the biggest stars of our scene today.

“Over the past four years, innovators and entrepreneurs have taken their destinies into their own hands to showcase their expertise. They are all used to being part of the next generation of tech products, and suddenly they were afforded an opportunity to do that in their own companies.”

Moving above the radar

As evidence of the impact of these events, 250 ICT businesses were founded in Tampere between 2000 and 2006. Between 2016 and 2020, that number has doubled to more than 500 in less than five years.

“And the majority are still in business,” added Puttonen. “The success and survival rate of IT companies in Tampere is absolutely remarkable.”

So smartphone knowhow has transformed seamlessly into world-leading automotive, healthtech and cleantech innovation as one cluster, with ICT product building as its second primary strand. With the largest concentration of machine building business in Europe, and an ever-growing list of world firsts across product design to its name, Tampere is the Nordic heavyweight flying under the radar.

But with the imminent opening of Platform6, and recent news of Microsoft’s return to Tampere by way of a new Development Centre being revealed in September, that “dark horse” status is about to become a lot more exposed.

“We are so excited about the future,” said Santos. “We have long dreamed of a place that would epitomise the best of Tampere’s startup ecosystem, under one roof, and that place is Platform6.

“We hope it will contribute to a general acceleration of new business, driven by enhanced network building across influencers, entrepreneurs, investors and hubs.

“Moreover, it will mirror the diverse and inclusive environment that the city has become as it makes the transition from a thriving local community to a genuine global player.”

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