Last week came the announcement that Innovation Norway had appointed Alliance Venture Spring in Oslo and ProVenture Management in Trondheim to manage two new national seed funds. Each of the funds will be about 500 million Norwegian Krone, which works out at a little over €60M each, with a 50-50 split between private investors and the government.
While the ProVenture Management fund is targeted at the oil & gas industry Alliance Venture Spring has been tasked to manage the money that will foster new IT successes. Although the fund is based in Oslo it will have a nationwide reach. In other words small businesses located in other parts of the country will be able to benefit from the investment fund as well as those based in the capital.
According to ICT Norway Director Fredrik Syversen neither Oslo or the national IT industry has been the beneficiary of these sorts of large scale government investment funds before. It has been hard to find investors, tough for entrepreneurs to raise seed money in Oslo before. With all this money injected into the system the challenge will now be to find many new business cases that can invested in. Hopeful IT entrepreneurs will be able to turn to the Alliance and submit their business plan, describe what they are doing and what they need money for. That’s a pretty simple direct route to secure the finance an early startup might require. The fund’s goal will be to find and support business that has a chance of succeeding internationally.
According to Syversen there is no upper limit to how high the seed fund can go with capital investment, but in a typical case they will be able to enter with 1-3 million krone. He also said that he’d never before seen a fund of this size targeting Norwegian IT startup companies.
So there’s a nice big pot of new money floating around for those enterprising enough to go for it. I wonder what sort of companies we’ll see grow from the seeds this fund will give out.
Top Image Courtesy of Shutterstock // Norwegian Flag