IT is still the fastest growth market in FinlandPosted: January 8, 2008
The main Finnish news paper (Helsingin Sanomat) held a competition for growth companies. Only one company was not in the IT sector. Interestingly Tiina Siltala wrote on Tietoviikko about the latest in IT growth funding the same day. Lets look back on 2007 what has changed?
Finns are still extreamly good at creating innovation and maturing it. Tiina makes a good point in her article that this is not the problem and in the last 10 years it hasen’t been. The problem is in productization, marketing and penetrating larger international markets. Finland has a cronic need to nurture a handful of hundred million plus companies. This need is especially the case outside the capital metro area. In this sense nothing has changed during the past two years.
Technopolis Ventures is starting a new program that will provide higher levels of funding, but the bottle neck is in EU rules on how government subsidies can be used. Where the money is needed the most, the money cannot be used. It is still on the venture community to enable companies to take the international leap and grow from a million to ten and then a hundred million. Government backed programs can be used to lay the ground work and to build a solid basis, but one could ask how these new programs will fundamentaly change how we take product to the global market? The answer is not throwing more money at the same thing.
During 2007 I have personally seen a rising interest in the larger international venture markets and a willingness from a new generation of Founder CEOs to take the fight to the major markets personally. There has also been a number of acqusitions by foreign companies, which I personally think is a good exit for a Finnish serial entrepreneur and highly beneficial for the Finnish entity and its employees. These are the main changes and positive trends that I have seen during 2007. The more international we become as individuals the more international our businesses will grow.
What is also needed is a change of mission and funding structures for government subsidised trade missions. Trade missions should focus on match making rather than consulting. Consulting in itself will not scale to execution in this case. Execution and planning need to be linked directly in order to be effective. I would recommend the model used by most metro chambers of commerce. There is a membership fee, which allows access to seminars and a local eco system. Seasoned facilitators can help with introductions. The facilitators should be measured against gross revenues in the US region for chapter members. Chapters could provide temporary office space and the services needed by market entrants (at subsidised prices). The government that subsidises this effort would get their returns from generated back home and taxes paid on consolidated profits.