A Close Up on Northern Swedish Startups

The night sky in Kiruna, the northern lights are visible. There are the black outlines of trees in the foreground. A rocket has been launched and can be seen in the centre of the sky.

writer icon Danny van de Wijngaard     Marcus Lindh   |   Startups     🕐 23. Aug. 2018

As the northern parts of Sweden are covered in hills, lakes, forests and farmland, it is widely considered a largely rural area. Yet, the region is booming with growth in new startups.

Surprisingly, there is a wide variety among these new startups. No single sector seems to dominate. There are high tech startups as well as startups in the gaming industry and even startups revolving around mineral mining in the region.

A strong north
Social media giant Facebook has announced that it is doubling the size of its current data centre in Luleå. Furthermore, Luleå Science park will develop a new Technology Deployment centre. 

Although Stockholm may lay claim to unicorn startups such as Spotify and Mojang, Northern Sweden has scored relatively well when it comes to successful startups. In a list made by Ny Teknik och Affärsvärlden, 33 successful Swedish startup Tech companies have been appointed. Out of the 33 companies, 6 were from Norrbotten and Västerbotten counties.

Relatively speaking, looking at population numbers, the northern statistics are impressive. 

Some Challenges
Despite a growing trend in the northern startup market and a stable economic climate, there are challenges for new startups. One of those challenges, as for most startups, is funding.

To aid new startup companies, government and private support is offered, both nationally and regionally. This support can come in the form of incubators and Science Parks such as the SISP.

Jens Lundström, CEO of the Arctic Business Incubator (ABI), believes there are more struggles for some startup companies in the north. In years of experience with northern startups, he has often seen rapidly growing startups struggle to find new and fit personnel. 

Growth is hindered

In a low populated area such as the north of Sweden, it can be very hard finding the right new people to take newly available jobs. This can hinder a startups growth or even their success. 

“I think that both existing and startup companies need to market themselves a little bit more,” Lundström said. Marketing campaigns and contacting new graduates are ways he hopes to solve these issues.

The Arctic Business Incubator
Incubators such as the Arctic Business Incubator play a pivotal role in helping startups in Northern Sweden. The ABI was founded in 2005 and is a private company owned by the LTU holding, Norrlandsfonden, Region of Norrbotten and the Luleå and Skellefteå municipalities. 

ABI has a very hands-on and pragmatic approach to helping out new companies by providing them with skill development and helping to arrange meetings with potential investors, clients and partners. To help investors in the region, they also manage a third party Angel Funding, looking for potential investor-startup relationships.

Space tech
An exciting development in the northern startup market is the rise of space tech. The Esrange Space Center near Kiruna is set to become Europe's premiere Spaceport with research facilities, satellite facilities and soon the first European satellite launch site. 

A specific incubator targeting space-related startups has come to life. The ESA Business Incubation Center, or BIC, opened in 2015 and is managed by the Arctic Business Incubator in the northern region, in collaboration with others. 

A positive future

Their goal is to help 40 Swedish startup companies over the next 5 years. The companies will receive seed funding and will be able to tap into additional resources in support.

A positive future lies ahead for the region. Recent developments, recent successes and professional lifelines will attract more and bigger businesses, such as the Northvolt car battery company in Skellefteå, bringing in hundreds of new jobs and ensuring the North will remain a vital part of the Swedish economy.

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