Not yet – but Sweden do has ambitions to be the world’s best startup country, and is already no. 2 according to the country’s startup manifesto.
According to the authors of the Swedish Startup Manifesto, they want “Sweden to become the most startup friendly country in the world where many, many young companies grow, thrive and stay.”
Sweden is a tiny country, known for having high government spending. How can it expect to breed a large number of vibrant businesses?
In spite the fact that Sweden’s capital Stockholm is the second most prolific tech hub in the world on a per capita basis, behind Silicon Valley, many believe that the country’s big corporations push the Swedish economy forward. The fact is, however, that 99 per cent of all companies in Sweden are small businesses, which today account for four out of five jobs.
Related: Doing Business in Sweden
Sweden is a leading country when it comes to promoting the formation of ambitious new businesses. In spite of being a 10 million population country, no 89 on the world population ranking, the level of new and expanding startups is astonishing.
For instance, the Swedish music-streaming company Spotify, started six and a half year ago by a 23-yar old boy from Stockholm, has reached a valuation of $8.53bn and is by many considered better than Apple Music.
Did you know that Skype was the first Swedish unicorn? It was bought by eBay for $2.6bn in 2005. Also the online-payment company Klarna and the gaming company King were founded in Stockholm.
Related: Sweden’s Museum of Commercial Flops
Paradoxically enough, Sweden is the second best country in the world when it comes to producing modern billion-dollar startups. In Sweden there are 20 start-ups, compared to only five in the United States, when defined as companies of any size that have been around for at most three years – per 1,000 employees, according to data from OECD.
At the Inaugural Brilliant Minds Conference in Stockholm in June, Skype creator Niklas Zennström said, ““Stockholm is becoming a world leader in technology.” “We are living in an extraordinary time, and there is no doubt that Sweden is a leader in this proud new world. The dream we had of becoming a tech community 10 to 15 years ago is now becoming a reality,” added Spotify founder Daniel Ek.
The Swedish Startup Manifesto states: “Our goal is for Sweden to become the best country in the world when it comes to startups as a popular movement. Startups with a breadth of solutions from different industries, with founders from many different backgrounds, in different phases of developments, that creates jobs, welfare and the next generation of large companies.”
Not surprisingly, Sweden ranks highest in the developed world when it comes to perceptions of opportunity: Around 65 percent of Swedes aged 18 to 64 think there are good opportunities to start a firm where they live, compared to just 47 percent of Americans in the same age group.
According to a report published in March by the Stockholm-based investment firm Creandum, the Nordic region represents 2pc of global GDP but has accounted for almost 10pc of the world’s billion-dollar exits over the last decade, with more than half of these coming from Sweden.
For any economy, striving for efficiency, job creation and all-around dynamism, producing startups matter. Last year marked the best year ever in terms of exit value for Nordic companies, including three $1bn exits and more than $13bn in total exit value.
During the financial crisis in the 1990s, when Swedish GDP growth sank and unemployment spiked, the government raised interest rates to 500 percent in an effort to avoid devaluation of its currency. The government also deregulated industries such as taxis, electricity, telecommunications, railways, and domestic air travel to increase competition. Deregulation helped lower prices in industries such as telecommunications, which attracted more customers. Some public services such as elder care and primary education were outsourced to private firms.
The tech scene in Sweden, with a population slightly more than London, thrives because of, not in spite of, its small population. The domestic market is too small for expansion, and Sweden has therefore always been exporters. Just think of Ericsson, Volvo, IKEA and …ABBA.
The 1990s financial crisis helped in fact Sweden to be a startup nation. Today the country has proved that a dynamic economy can coexist with relatively high taxes and a robust safety net. It has also proved that economies can change over time.
Sweden- the Best Startup Country in the World, written bvy Tor Kjolberg