Having invested in Fyndiq, Klarna, Matsmart, iZettle, Spotify and Fishbrain, Northzone know the Stockholm ecosystem rather well! Jessica Nilsson, Principal at Northzone, gives her insight into the current Stockholm tech scene.
The great thing about being part of a pan-European fund like Northzone is that I get to work with a brilliant team in Oslo, Stockholm, London and New York, and with entrepreneurs across the whole continent. It’s a privilege to get to know a number of tech ecosystems, and we are seeing lots of fantastic companies and entrepreneurial ambition, from Barcelona to Berlin and everywhere in-between. But Stockholm is not only my home, it is also my main focus, and there is something special in the water.
Much has already been written about the Nordic tech miracle: how can it be these small countries in the north produce more billion dollar companies per capita than anywhere else outside of Silicon Valley? I am not going to dwell on the reasons behind this (but if you’re interested, read my colleague PJ’s insightful blog on the three secrets behind the success of Swedish startups LINK). Instead I want to share some of the trends I am seeing right now, that perhaps will come to define the next generation of global companies.
1) Creative thinking for fundamental change
What is really exciting about the Swedish companies we work with is the creative thinking at the core of how they address their market. Take Universal Avenue, who are re-thinking the possibilities of outsourcing, and applying it to the sales process. In doing so, they are also changing what it means to work, attracting talent to become Brand Ambassadors by working on their own terms; teaming bold vision and a global mindset.
2) Extreme product and design focus at the core
With a strong design heritage in Sweden, it’s no surprise that many startups in Stockholm often have an extreme focus on product and design. Spotify’s UX is famous, but on the B2B side too, companies like Klarna are redefining processes using elegant solutions – in this case optimizing the conversion funnel for their merchants. A fanatical belief in the importance of product and always putting the user first is at the heart of their success.
3) New ways to structure teams
Many of the startups we work with are experimenting with new ways of structuring teams, not only for performance, but also because they recognize the importance of building for a long-term, sustainable culture. The flat structure of Swedish companies is well-known, but taking that further, e-commerce company Fyndiq have launched “play time” enabling real innovation to emanate from all departments, while Spotify lead by example and are offering paternity leave for all their staff globally.
4) Conscious matters
Conscious consumption is (rightly) here to stay. Companies like Matsmart are addressing the traditional pain points in the food value chain to maximize value and minimize food waste. Good for the producer and the end-consumer. Others are using the power of community for social benefit. Take FishBrain, the social network for anglers, that partnered with the US Fish and Wildlife Service to help track endangered species.
“I am seeing great innovation and companies in the Stockholm ecosystem. Of course, as with all big cities, Stockholm faces challenges around issues like access to talent and housing, but I hope that as the current star companies mature, their legacy will in turn continue to inspire and support the creation of the companies of tomorrow.”