I had lunch today with Juha Huttunen and Leo Koivulehto of Vailoma.com. We discussed entrepreneurship in Finland and how it differs from the rest of the world.
The conversations pretty much rolled around the difficulty of raising funds in Finland, compared to availability of funds in Europe and the US. The problem was again tied to the post I blogged some time ago: scale or revenue. The Finnish VCs usually wanted to see revenue and a potentially profitable business model compared to their European counterparts who are willing to take more risks. I believe this has got to do with two main points: (1) No previous success in internet companies, ie. no culture and knowledge in these sort of investments and (2) lack of funds.
The reason why I see this a problem is that as foreign VCs keep investing in Finnish startups, we won’t see a culture evolve here nor do we see any growth in capital as those successful investments pay off. This further creates problems in starting born global, growth companies in Finland.
Would it make sense to start a government owned fund to help companies grow in this stage of their lifecycle? We have TEKES, who helps with financing startups in their birth stage – what about helping startups more aggressively in their growth phase?