Jörgen Eriksson and Cecilia Magnergård take a look at the incubation scene in Sweden Entrepreneurial Climate
These days, many people start each morning by reaching for their tablet or iPhone. We go through the e-mails received the previous evening, glance at the latest news or simply catch up on one of the many social platforms.
As we get out of our homes and commute to our workplace, we get updated on new posts on Facebook by our friends and family. If we commute by car we pay for our parking using a smartphone app and we get a reminder when the parking time is running out. Then, arriving in our workplace we check in on Foursquare. For many the first activity in the office is to take a look at new posts on LinkedIn.
The internet has become an exceptional tool that has given rise to a daily economy of interaction, collaboration and sharing.
Small start-ups can instantly reach out across the world market and compete with the gigantic global players. Innovation is more global than ever, and the Nordic countries seem to be at the forefront of this development. In 2007, the Swedish capital, Stockholm, developed a clear vision – Stockholm 2030 - to become the ultimate city for individuals to live and develop knowledge intensive new businesses.
Based on this vision, the city has successfully attracted talented and driven students, researchers and co-workers from all parts of the world. Stockholm has become a place where the right-brained dreamers could meet the leftbrained doers, and this blend has resulted in a number of successful new companies.
The city is on the right track. The Price Waterhouse Coopers global survey 'Cities of Opportunity' in 2012, saw Stockholm and Toronto top the rankings for intellectual capital and innovation. The Swedish start-up scene has exploded with massive global successes such as iZettle, Wrapp and Mojang, and already mature companies like Spotify are proof that the city produces winners. It’s party time for entrepreneurs in Sweden!
As Sweden is a small and highly export-dependent country, future prosperity in the age of globalisation depends on the country´s collective ability to develop the knowledge economy and compete in knowledge-intensive industries.
For this, incubators have a central role in enhancing the competitiveness and growth of young companies.
Today, Sweden has 46 business incubators scattered all over the country and funded from several different sources. They are an important component in the implementation of Sweden’s national innovation strategy and the government has tasked the incubators with increasing the number of incubated businesses and help them with early internationalisation.
A Swedish business incubator supports new companies in preparing and handling the difficulties in early business development stages that can otherwise often lead to failure, to serve as a guide for external funding and help to develop the specific entrepreneur's ability to run a business. The incubators act as catalysts that offer favourable environments for young business growth.
Malmö-based Minc is a good example of a Swedish business incubator. Minc is a creative hotspot for meetings between young entrepreneurs, venture capitalists, industry, research and innovation. Minc use something they refer to as the Minc Method that combines the latest business development tools with personal coaching. The Minc Method has shown to be a great success. The two companies, Polar Rose and AlgoTrim, that have now been bought by Apple, were both clients of Minc. The business incubator offers full support from idea generation to actual implementation of marketready products or services.
LEAD is another example of a successful Swedish business incubator, located in Linköping in East Sweden. LEAD provides entrepreneurs (with innovative and scalable ideas that have strong growth potential, both from academia and industry) with an efficient process to quickly and safely develop these ideas into strong and expanding companies. LEAD has numerous success stories, and it is not uncommon to see companies that stem from LEAD achieve high places in prestigious rankings for companies that are rated for addressing market needs or that show high probability of growth. One example of this is ALMIs Big 29-list that rewards business incubator companies with exciting business ideas and growth potential. Last year, as many as four of the LEAD alumni ended up on this prestigious list.
Ideon (an EU|BIC)
Many Swedish incubators are co-located with science parks. One example is Ideon Innovation, located at Ideon Science Park in Lund. It is a general business incubator that also embeds several other incubators, namely The Creative Plot, Venture Lab and the service incubator LIFT. They all have separate staff and separate brand profiles but collaborate on IDEON Innovation's backbone of infrastructure. (See P 24)
In addition to the basic allocation of 50 million Swedish kronor (about €5.6 million), the Swedish government announced, late last year, that they will invest a further 30 million SEK (€3.4 million) on Swedish business incubators in 2014. The initiative is a part of the national innovation strategy that includes an aggressive agenda to boost the innovative force and ability to further grow and develop business ideas in all parts of Sweden. This is driven by the Swedish minister of Enterprise, Annie Lööf, who claims that business incubators are important tools for generating a creative and dynamic business environment. The offering includes support and counselling for knowledge-intensive and high-growth companies in early stages to develop and further expand into international markets.
The public benefits of the business incubators in Sweden are indisputable. They foster sustainable business growth and are persistently stimulating Swedish entrepreneurship.
For the seventh year in a row, the magazines Ny Teknik, New Technology, and Affärsvärlden, Business World, launched a renowned list of Sweden's hottest young technology companies. Over the past years many have had connections to Swedish Incubators and Science Parks, and this year is no exception - 16 of the 33 companies were spun directly of an incubator or a connecting Science Park.
The purpose of the 33-list is to highlight companies that have the potential to become tomorrows export successes and stock exchange giants. Anyone can nominate companies to the list, but the ranking is defined by a common thinning by both Ny Teknik and Affärsvärldens editors based on a number of explicit and business specific criteria. In order to be considered for the list, the company must have existed for a maximum of seven years, the company’s product must be based on technological innovation, the company cannot be listed on any form of commerce, and the company must display the potential to make a significant mark in the international arena.
As outlined, at this year's list no less than 16 out of the 33 companies came from Swedish Incubators and Science Parks. It is a strong feat and worth emphasizing as these growth companies represent only 0.5 percent of the Swedish companies. Conclusively, once again, the list demonstrates that Swedish incubators continue to play an important part in stimulating the development of successful entrepreneurs and companies. Companies that present research have shown that incubation creates more jobs and contributes to strong growth in Sweden.
It has not been proven that stand-alone innovations, initiatives or educational systems enhance or stimulate cooperation, commercialisation or innovation to the desired levels. It is, therefore, important to promote communication, transparency, and collaboration between all involved parties. This will enhance the outcomes and benefits to reinforce cluster capabilities and competitiveness, adding incentives for a quicker and better market uptake.
World-class companies are located where development is happening. Without doubt, Sweden is at the cutting edge of innovation environments and business incubation facilities and services, where the main focus is on knowledgeintensive, growth-oriented companies. Strong governmental support, high levels of general innovation capacity, a public environmental awareness and a constant desire to apply technological insights to environmental challenges and successful business incubators are some of the reasons why Swedish entrepreneurs tends to create knowledge-intensive companies that are taking a lead, over and over again. All of this serving to underline the fact that for entrepreneurs and start-ups few places in the world can match Sweden.
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