Timo Ahopelto is the founder of Helsinki-based Lifeline Ventures, an early stage VC that has invested in companies like Supercell, Applifier (now Unity3D) and Enevo. In March, the firm launched a new 57 million euro ($63 million) fund to invest in startups. I posed Timo a few question about he current state of the Finnish startup scene.
1. According to FVCA’s report, Finnish companies received over 1 billion euros of VC/PE investments in 2015. What does this tell you?
Finland is on track to a very good start. Israel raised $ 3.5 billion in 2015 into 1,200-1,500 tech companies, which probably is what a national ecosystem in a smallish country can create. Finland will be there in five years’ time. The growth path from here onwards is very clear.
2. Why does Finland attract early stage investments?
Fundamentally and simply: Finland is producing high quality tech startups. This is the result of what I call “Finland’s entrepreneurial renaissance”. It started in 2009, when Aalto University Entrepreneurship Society was founded. This student-led movement gathered the ecosystem together and drives projects like the Slush conference.
3. Which industries do you see emerging from Finland in the next few years?
My strongest bet is AR/VR. We have the requires components in the ecosystem for both software and hardware: consumer electronics devices based on the Nokia history, content by the games ecosystem, computer graphics dating back the Finnish teams dominating the demo scene in the 1980’s, big data, and artificial intelligence with the very specific machine vision twist.
4. As an investor, how do you find companies? Or do they find you?
We mostly invest in companies whose founders we know or who we have a strong link to already. It is difficult to say who finds who. Finland is a very connected startup ecosystem where one knows what is going around.
5. Looking at developments in Europe and the crackdown on companies like Uber and Airbnb – how do you see the future of these two companies in Finland?
Airbnb is easy. It is fully legal in Finland, and difficult to see how and why individual cities or the state would want to ban the service. Airbnb will grow and flourish.
Uber is more difficult. The first case against an Uber driver is now in the higher court, and tens of similar court cases are being considered. I don’t have a crystal ball to forecast how this will turn out.
Personally, I think that we need to have a broader tech strategy as a country. The government needs to develop a deep-rooted understanding of how global tech will fundamentally change small country’s role as an economic and political actor. Once there is this understanding, we can develop our strategy and take stance on things like Uber and Airbnb.
6. Do you think Finns have recovered from the demise of Nokia as a growth engine?
Mentally yes, but economically it will take another three to five years to develop the growth company ecosystem to the level that it compensates the loss.
7. Do you believe that Nokia can make a comeback? (considering news about the company returning to smartphones)
Yes, but not necessarily in the mature and even somewhat declining smartphone market. The playing field is entirely open in AR/VR and connected health, where Nokia has launched new products and made acquisitions.
8. What should the Finnish government do better in order to foster growth?
Take down regulations and artificial growth barriers. The dialogue with the startup ecosystem is already active and on a very good level. Everyone in Finland wants to make this work now.
The Abraham Accords is widely seen solely through the prism of the Arab-Israeli conflict with once hostile sides coming together to herald a new peaceful era for the region. While the peace agreement between Israel and the two Gulf nations, UAE and Bahrain, is a major step towards wider normalization between Israel and the Arab world, and a show of strength against Iranian expansionism and aggression, it can also be seen as a strategic masterstroke by the Trump administration to counter China’s aspirations to exert Beijing’s power in the Middle East and beyond.
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