Last week, I subjected myself to a very intense series of meetings with entrepreneurs and investors in Stockholm, as a welcome crash course introduction to its vibrant and growing tech startup ecosystem. In all my years monitoring and covering the tech industry all across Europe, I’d never made it to the small but indisputably beautiful capital of Sweden, so my main intention was to fix that once and for all (guess I can scratch it of this long list).
The trip was absolutely perfect, and not just because the city of Stockholm graciously decided to step in as I was planning it, assisting me in scheduling most of the meetings, and covering my flight and accommodation expenses (in the interest of full disclosure).
What happened next was a whirlwind tour of startups, and a stop by the excellent STING Day event to catch up with a number of prominent Nordic investors.
In the next few days, I’ll be posting a number of articles about the Swedish tech startups I’ve paid a visit, along with video interviews of Stockholm’s most prominent and upcoming entrepreneurs.
Update: here are the first ones:
But I also wanted to publish my general thoughts on Stockholm as a tech startup ecosystem, based on my observations and the many conversations I’ve had with ‘the locals’.
Stockholm is irrefutably among Europe’s top tech ecosystems
It wasn’t much of a surprise to me that I ended up bumping into many non-Swedish investors during the few days I spent in Stockholm, and that they weren’t all there solely for the aforementioned STING Day. In fact, I gather that many of them spend quite a lot of time in Stockholm vetting potential investments these days – and for good reason.
While people who are only moderately aware of what is happening across Europe tend to point to London, Berlin, Paris and Tel Aviv when you ask them about the continent’s ‘hottest’ startup ecosystems, the reality is that the Nordics in general have already proven to be fertile ground for many a successful technology venture, and it doesn’t look like things are slowing down.
Helsinki has produced the likes of Rovio and Supercell; Oslo internationally acclaimed companies like Opera Software and Meltwater; Copenhagen market-shifting ventures such as Zendesk and Tradeshift.
But Stockholm has had a really good run as the birthplace of many leading tech companies in the past decade, after the somewhat abrupt end of a previous one in the late 1990s.
Don’t just take my word of it: the proof is out there
There’s Spotify, which still has a ways to go but has undeniably altered the music industry with its polished, legal digital music streaming service. There’s King, the casual gaming company that was already moderately successful in its first 10 years of existence but rode the massive success of its hit game Candy Crush Saga all the way to a NYSE IPO and is currently valued by the public market at more than $5.2 billion. There’s Klarna, the fintech company that now has a more than a 1,000 employees working to genuinely disrupt the banking industry as we know it today. Then there’s Mojang, the indie game developer you might be familiar with as the maker of Minecraft (and its, erm, ‘special’ founder Markus ‘Notch’ Persson), and freshly funded mobile payments startup iZettle.
These are all companies that are competing on an international level, but, to me, perhaps more fascinating than getting to know Stockholm’s tech giants from up close were my visits to the lesser-known, scrappier startups that might be the ‘next big things’.
Those included stops at the offices of e-commerce enabler Tictail (which has raised $10 million+ but is still working its way on the radar, even in these parts), music hardware maker Teenage Engineering (a true ‘garage startup’ if I ever saw one), Goo Technologies (which is building jaw-dropping rich 3D media tech), lean hardware startup extraordinaire Narrative, Sequoia Capital-backed mobile phone community Truecaller and Toca Boca, maker of extremely popular mobile apps for kids.
Obviously, because of the inevitable laws of time and space, I was unable to meet up with more interesting tech ventures, but there are many more: keep an eye on the likes of 13th Lab, Tobii, Campanja, Volumental, Jumpstarter, Safello, Whitespace, FishBrain, Cint, Hansoft, Lifesum etc.
Not all rainbows and butterflies
I should note that not everything I saw in Stockholm was equally impressive or boast-worthy.
While there’s been a massive boom of co-working space and incubator-type settings in European cities from Amsterdam to Zurich, Stockholm really only has one of note – SUP46 – and it’s been open for less than a year. Not that that is a huge issue to overcome, but in such a seemingly healthy tech ecosystem I found that to be a noteworthy observation, even if there are lots of initiatives being started to encourage closer ties among the entrepreneur community (see, for example, the very successful STLHM Tech meetups put on by American entrepreneur and consultant Tyler Crowley and STING, the organiser of the aforementioned STING Day but also much more).
Worth a note too: some Stockholm startups look super interesting on the surface but have so many hurdles to face that I doubt they will be able to survive – at least in the current iteration.
One of those is Magine, the well-capitalized cloud-based TV operator that is seeing some early signs of success in the important German market – I fear that the 110-person company is just a tad too reliant on close relationships with oft-flaky, we-like-to-be-in-control broadcasters, regardless of how impressive their technology and how beautiful the user experience is. To be continued …
Another is Instabridge, a seemingly hot early-stage startup that makes it easy for users to find, use and share WiFi networks. Not only do they face stiff competition from established rivals, but not being available on the iOS platform isn’t doing them any favours – despite the fact that the question surely gets asked a lot, you won’t find any indication of said unavailability in the startup’s FAQ.
I also gather that Wrapp, a startup founded by the former CTO of Spotify (Andreas Ehn) has bet heavily on expanding its social gifting service around the world in light of increased competition of Rocket Internet-backed clone DropGifts, and may have done so overzealously – to the point where the company has come under a lot of pressure from its investors.
Also: there isn’t really a close-knit technology community to speak of in such a relatively compact city, and there seems to be something of a disconnect between the ‘older’ generation of company founders (the ones who built their businesses in the nineties) and the budding entrepreneurs I’ve met.
That’s nothing that can’t be fixed over time, but lest you think all is rosy in Sweden’s capital when it comes to tech startups and innovation – there are clearly certain ingredients that still need to be added to the mix, and further maturation will obviously take more time.
But, overall, I look at Stockholm and I see a great city with a lot of potential and a vibrant tech ecosystem that has already produced a few billion-dollar companies – and I found absolutely no reason to believe more startups won’t be following in their footsteps.
As promised: more to come in the next few days.
Featured image credit: Mikael Damkier / Shutterstock