World’s happiest nation is changing into a startup mecca

Silicon Valley is named the startup capital of the world. It is the place entrepreneurs go to lift cash, develop their tech platforms, and discover buyers.

However one metropolis identified for the maritime business is rising as one of many fast-growing tech scenes exterior the U.S.

Oslo, Norway’s capital metropolis, skilled a 160% uptick in startup investments prior to now 12 months, in line with Oslo’s 2017 State of the City report. That is the second greatest soar within the Nordic area behind Sweden, up 171%.

“There is a booming startup scene in Oslo,” stated Tellef Thorleifsson, a founding accomplice of the Norwegian VC Northzone. “Nevertheless it’s nonetheless within the early phases.”

Norway is the eighth wealthiest nation on this planet due partially to its greatest export: oil. It was just lately ranked because the happiest country on Earth by the United Nations 2017 World Happiness Report. The nation’s sovereign wealth fund simply topped $1 trillion final month.

However in recent times, Norway has needed to compete with decrease oil costs within the Center East and Venezuela.

Now, its leaders need to eco-friendly tech as the subsequent massive cash maker — a pure evolution for the nation, which has lengthy been dedicated to sustainability. It is presently one of many solely international locations to have a tax on carbon emissions, and the federal government affords a 25% subsidy for gas environment friendly automobiles.

Related: Where are the world’s happiest countries?

Crown Prince Haakon of Norway at Oslo Innovation Week

“Should you’re gonna clear up the world’s greatest points at the moment, you really want know-how and innovation,” Crown Princess of Norway Mette-Marit instructed CNN.

Crown Prince Haakon and Crown Princess Mette-Marit are encouraging extra entrepreneurs to reap the benefits of buyers all in favour of funding socially minded startups.

Final 12 months, there have been 78 investments in Norwegian tech corporations — totaling $100 million, in line with the 2017 State of the Metropolis report. About 15% of tech investments within the nation had been centered on sustainability, the very best amongst all of the Nordic international locations, analysis agency Nordic Net finds.

Different northern European cities similar to Denmark and Helsinki have some cache for producing profitable tech startups like Spotify and Rovio, maker of Indignant Birds.

“The standard of the entrepreneurs we see [in the country] now in comparison with 10 years in the past is lots greater, ” stated Thorleifsson of Norwegian VC Northzone.

Thorleifsson was an early investor in Spotify and has a various portfolio of digital tech corporations — nearly all of that are from Scandinavia. Northzone is an investor within the Norwegian firm Kahoot!, a game-based studying platform primarily utilized in faculties. It boasts 50 million month-to-month distinctive customers.

Oslo Innovation Week
Oslo Innovation Week

“There’s numerous capital in Oslo and some huge cash going into tech,” stated Kahoot! CEO Erik Harrell. “I believe these components helped make Oslo a superb place to begin corporations.”

Whereas most of Kahoot!’s customers are within the U.S., 85% of their funding is from Scandinavia.

“We discovered getting funding in Europe was pretty simple,” stated Harrell. “The Nordic enterprise capital neighborhood is pretty small so having access to [VCs] wasn’t that troublesome.”

Whereas Norway’s startup scene has numerous momentum, the nation has solely produced one unicorn: the blockchain platform, IOTA. Blockchain is a knowledge base for cryptocurrency, which isn’t regulated by a central governing physique and is used closely in growing international locations.

This 12 months alone, Silicon Valley added 44 unicorns. A unicorn is a startup valued at over $1 billion.

However since 2014, Silicon Valley’s share of worldwide unicorns has decreased by virtually 50%, in line with Northzone’s evaluation of knowledge published within the Wall Avenue Journal. In the meantime, the variety of unicorns in Asia and Europe has grown considerably — up 400% and 700%, respectively — in simply three years.

Related: 10 best cities to launch a startup

Oslo Startup
Startup CHOOOSE wins a pitch occasion at Oslo Innovation Week for its work elminating carbon emissions.

Martine Kveim of CHOOOSE, a Norwegian-based local weather change platform, sees that as a bonus.

“[Norway] remains to be a lot much less mature in comparison with many different components of the world, which opens up nice alternatives for attentive buyers,” stated Kveim.

A type of buyers was Nordic Impression, a VC agency that invests solely in corporations with sustainability-focused enterprise fashions. It was an early investor within the practically year-old startup CHOOOSE, which focuses on eliminating the carbon footprint of huge companies.

The corporate works with the UN Framework Conference on Local weather Change and the EU Emissions Buying and selling System to promote carbon emission quotas to the typical particular person and socially-conscious corporations. The method of buying carbon quotas is often reserved for large companies with a big carbon footprint. The transfer makes the carbon quotas much less out there for large polluters.

Related: How Norway is changing the way we drink coffee

“[We’ve had investor interest] as a result of we have discovered a great way to attach idealism with inexperienced capitalism,” stated Kveim. “Our expertise is that impression investing alternatives attracts those that have much more to supply than funding.”

Anders Lier, the chairman of of Nordic Impression, believes there may be more cash to be produced from corporations centered on sustainability.

“[Young people] wish to purchase good merchandise which can be good for the planet, and so they’re keen to pay premium costs for it,” Lier stated.

As startups proceed to develop and search for funding, some are attracting consideration from exterior the nation, too.

“Many buyers we’re [talking to] now are coming from exterior of Norway,” stated Kveim of CHOOOSE. “The imaginative and prescient and mission of the corporate appears to don’t have any borders.”

CNNMoney (New York) First printed November 6, 2017: eight:40 AM ET

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