As I was looking at through the companies presenting tonight at the ArcticEvening Copenhagen (it’s going to be a very good event by the way!), I noticed that almost, if not all of them are business-to-business companies. This is an interesting trend in my opinion as Finland and Sweden are in my opinion more oriented towards the consumer market.
Finland, which I know best, is very oriented towards the consumer market in terms of internet oriented startups. We have our share of b2b startups as well and if we go back a bit we can remember that SteelTeam acquired Christoffer Landtman’s CompanyCube operating in the steel industry. Then again we need to remember that Jaiku was acquired by Google so there are acquisitions on both fronts. Unfortunately there aren’t many more cases that could be given as examples.
Sweden on the other hand is much more b2b oriented in terms of internet startups, or at least this is the perception I have. If we look at Videoplaza for example – one of the more successful Swedish startups in my opinion, is purely B2B oriented and doing very well at it. Sweden itself has a strong consumer internet market as well. This in my opinion is related to the strong usage of the internet and a population with a good purchasing power.
Denmark, being the last country of my light analysis is the one (if we look at the population of startups through the companies pitching at the event) with the most B2B oriented companies. I find this highly interesting as I personally believe that there is a lot more easier money to be made on the B2B market at the moment compared to the consumer market. Why is this? There are a few reasons.
First of all, the environment you are working in between the two markets is totally different. While in the b2b-market, you work with a few clients and the revenues per purchase are high compared to the consumer market where you need at least thousands of consumers before you can make any money as the revenues per consumer are naturally lower.
Secondly, if we look at the exit market in the two markets – businesses are more likely to purchase companies that actually help them create business, just as it was in the case of CompanyCube. This is tough in the consumer market as business models regarding many industries are still in the making with startups resolting to ad generated models.
Naturally there are many more reasons, but these are the few obvious ones. What’s your take on this? Is this my percepetion only or are there people out there sharing the same vision and why?
Image by Olemisweb (Creative Commons)