Finland: the Land of Gaming

The European Innovation Scoreboard (EIS) says Finland is the best place for companies to find risk capital. Our recent research confirms that evidence. In Finland, we tracked 126 scaleups (second largest scaleup hub after Sweden) able to raise cumulatively $1B total in financing (this is about 15% of the total capital raised by scaleups in the Nordic countries).

The venture capital industry seems to be very efficient in fuelling the growth of scaleups in Finland, on the contrary capital markets don’t play a large role. Only 5% of the total capital raised by Finnish scaleups comes through the IPO channel (and most of the capital raised this way is collected abroad).

If we compare Finnish scaleup numbers with the number of inhabitants, the ratio is 2.29. Actually, this figure is 1.5 times higher than Sweden, that is the Nordic country with the highest number of scaleups.

Finland has 2.29 scaleups every 100 thousand people. This is better than the average value we found in the Nordics (1.6). When compared to the rest of Europe the gap is even wider. Finnish scaleup numbers are approximatively 4 times higher than the UK if compared to the number of inhabitants, 8 times compared to Germany and France, 10 times vs. Spain and 19 times vs. Italy.

Finland scaleup ecosystem is characterized by a sort of ”polarization”. On the one hand, a wide group of fast growing small scaleups (approximatively 120 companies); on the other hand, a smaller group of companies – led by the scaler Supercell– that have already crossed the chasm and are well-known new economy leaders.

Finland shows a strong geographical concentration of scaleups. The Greater Helsinki metropolitan area is by far the most interesting hotspot of the country. 80% of all scaleups are headquartered in Helsinki and Espoo.

Data from SEP Monitor confirms the fact that Finland is the land of gaming. The gaming vertical accounts for 18% of the Finnish scaleups and for one third of the overall capital raised. Network/Hosting, Software Solutions and Mobile companies are the other relevant areas of specialization.

48 startups have been exiting via acquisitions since 2010. As usual in Europe, US companies are the most frequent buyers (40% of the total).

Alberto Onetti
Chairman, Mind the Bridge Foundation Coordinator, Startup Europe Partnership