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Start-ups international Interview

"Our founders in startups usually have strong technical backgrounds"

Freitags berichten wir immer über mehrere internationale Start-ups, die sich aus der Masse der anderen aus irgend einem Grund abheben. Heute machen wir eine Ausnahme und lassen nicht die Unternehmen sprechen, sondern Antti Vilpponen, der auf Englisch über die Welt der nordischen Start-ups referiert. Und wer könnte das wohl besser als er, der Gründer der Start-up-Website arcticstartup.com, die wie eine Klammer das ganze Start-up-Geschehen im Norden zusammenhält?

Antti Vilpponen, articstartup.comAntti Vilpponen, articstartup.com

Good Day Antti Vilpponen, today we'd like to know a little bit about yourself, your project arcticstartup.com and the nordic/baltic startup-scene. So, let's start with you, Antti! What is your professional and educational background? And how did you become interested and involved in tech-startups?

Antti Vilpponen: Thanks for the opportunity! I have my educational background in business and more specifically international marketing. I've also managed to enjoy quite a bit of time abroad (Singapore, Spain & Australia) when studying. So this has given me a good perspective on a more international level. I've spent my career working in different small companies. I started out as a Sales Director in Apaja, being in charge of consumer sales in close to ten countries.

From Apaja, I went on to co-found Gyllene Skor which is a digital agency focusing on different concepts and challenges related to better online business. Gyllene Skor was a first of its kind agency in Finland focusing only in planning related work, still taking responsibility for larger projects as well.

My latest position is the CEO of ArcticStartup, which as you may know is the largest online media in the Nordics and Baltics reporting on startups in the area of internet, mobile and cleantech.

I can't really state where my interest for startups comes from, but I guess it's the fact that I've also enjoyed the challenges they represent and the freedom one has in working with them. I spent some summers in larger corporations and while the companies were fabolous, I didn't enjoy the bureaucracy and stiffness these companies build up when they become large.

Now let's have a look at your website: arcticstartup.com. When did you found the page? With whom did you team up to put the project into practice and by the way: How did you get to know each other?

Vilpponen: ArcticStartup is a little over two years old. We initially set off with the blog with Miikka and me after I had done some pondering on the issue in my own blog. We soon geared up with Ville who ran the Open Coffee events in Helsinki at that time (still does as well as Karri, who's helping us big time with the tech issues. Last spring we took on board Paula, our Swedish stronghold as well as Päivi, who's helping us cover cleantech.

Miikka found the link on my blog regarding the concept and since we'd seen each other once before that, we had a weak connection there. I talked with Ville some 6 months after the founding of the page and Ville had some really good ideas and since everything synced up really well, we thought to go about it together. Once we got going, the message has traveled through the grapevines to others and that's pretty much how we've managed to grow as we are today.

The demographic givens in Scandinavia dont't seem to be too beneficial for founding tech-startups on the first sight: Scarcely populated areas, agricultural/arboreal business dominates large parts of thecountries, few metropolitain areas, to name but a few disadvantages. But nevertheless scandinavian start-ups, especially from Sweden and Finland are amongst the most successful. How does that come?

Vilpponen: Well, first of all, I do believe the Scandinavian countries as well as the Baltics are a great place to found companies as the markets are close by and yet very different giving a great test bed for a new product. If you're able to get traction for your startup here, I'm sure you'll be able to do it anywhere. Furthermore, counting to our advantage, all the countries in this area have an extremely good educational system. This creates top notch talent that is waiting to reap the possibilities out there.

However, despite the advantages, there are many shortcomings as well These are only now being improved by the government and individual players such as ArcticStartup. Most of the countries lack the culture of entrepreneurship and thus the social status of entrepreneurs isn't very high. This of course is reflected in many other aspects of the society and thus it isn't very appealing for the young guns to start their own companies when they're looked down upon. These are slowly changing, but we need a lot of work in this sector. On top of this many of the aspects of a good working startup ecosystem are missing. The governments are doing some initiatives on this, but a lot more effort is needed.

Surprisingly Estonia does very well in the tech-business, too. While many other Eastern European countries are struggling for new ideas, the small baltic country found a close connection to the nordic startup scene and is developing strong ideas. How did that happen?

Vilpponen: I think Estonia is actually quite a bit of things on their own. Also, not to understand things wrong, there are many great ideas in other Baltic countries as well. The problem for us is that we're slightly further away from them and thus it's a bit harder for us to cover them. So if there are good writers out there, don't hesitate to contact us! :) But to be honest, all the Baltic countries are doing in a great way.

I think the secret with Estonia is that they are a small country and they've also realised that they need to do a lot for startups to make it an appealing alternative for the talent they have. Once many enough see it an opportunity worth grasping, things start to happen on an economic level as well.

Tell me a little bit about the startup infrastructure in the arctic/baltic hemisphere: What kind of tech-events do exist? How does the startup-scene cooperate? Where are the hottest spots to be? How does the funding work? Which role plays arcticstartup.com?

Vilpponen: Quite a few questions there that could be the starting points of an interesting book, but I'll try and answer some as best as I can. The problem we see with the Baltic and Nordic startup scene is that there is a lot of activity in each country and all countries, to some point, have similar kind of events related to pitching, panel discussions, networking, conferences and so forth. To be precise, the problem isn't quite that, it's the fact that there is very little co-operation among different countries. Everyone's doing the same thing, but few are looking for synergies across the borders. This is regarding any startup activity, be it founding your company, beingable to debate your idea and build a team as well as get financing. There is a lot of potential in doing this cross border - this is something we at ArcticStartup are looking at. Once the whole market begins to wake to this, we'll start attracting some interest from other parts of the world as an international hot spot for startups, be the country Estonia or Sweden.

Let's talk about the founding-mentality in your region! In Germany, the web-startup-scene often complains about a lack of big ideas and courage amongst founders and investors. Scandinavians don't seem to have problems like that. Where are the differences?

Vilpponen: I think many of the western states, apart from the US (and perhaps UK), have some problems in promoting startups and the founding of smaller companies. The problem inherently isn't in good ideas being around, but in the mentality towards running your own company. I think about 3 percent of the Finnish population could think of running their own company, ie. have some entreprenurial thoughts. This of course is a proportion way small to have any impact on a national level. We really need to start working on  this to make it a more appealing alternative socially.

One thing that has been blamed at least by some is the great welfare system all the western countries have. You don't have enough incentive to do something like start your own company. I'm sure there is some truth there, but the problem is that the relative incentives to running your own business aren't good enough compared to working in someone else's company. This is where the government should really kick in and do its part.

I believe in the fact that ideas should be free to roam and those who execute them the best ought to be rewarded for the risk they've taken. Too many people still keep their business ideas in the dark so that nobody would take it and run with it - that's totally opposite to the way it's supposed to be. Share and debate your business idea as much as possible to make it as perfect as possible - people are willing to help, if you go about it right.

Another problem about German tech-start-ups is the fact that in most of the cases founders rather originate from a business-related background rather than from a tech-related one. How about your spheres?

Vilpponen: I think, at least regarding Finland, we are the opposite. Our founders in startups usually have strong technical backgrounds and experience, but lack the business side of things. Two big areas that need a lot of help usually are marketing and sales. This can actually be seen in larger Finnish companies as well, instead of telling the customer of the advantages of using this product many larger companies (eg. Nokia) have previously talked about the technical features in the product. In the end, the consumer isn't interested in these, but the value she will get from using the product.

I think the best scenario will be found somewhere in the middle, have a good combination of tech and business people that understand each other. In the end the distribution matters on the fact where the core competence of the company is. If the company is relying on kick-ass technology, it should have a strong tech background (not solely though) as opposed to a service business where the value is in a new business model for example, it should be strongly organised as business oriented.

At the moment arcticstartup is trying to involve northern Russia into the arctic/baltic network. Why is this region interesting to collaborate with? How is the networking doing so far? By the way, this nordic/baltic startup-region reminds me more and more of the medieval Hanse-network!

Vilpponen: We're doing some pilot projects regarding Russia and hopefully will be doing an event there soon. However we're still trying to tackle our main markets, Nordics and Baltics, before moving on. One of our core competences is that we have a good enough coverage in the markets where we're present and to be honest there's still quite a bit of work to do in the Nordics and Baltics. :)  Nevertheless, we won't hold back going to Russia if we get our concept running and rolling out fast in the other market areas.

Thank you, Antti Vilpponen, for your time and your insights.


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