Last week we published a members-only article: International Investors in the Nordics: Who? Where? How Much?
We’ve decided to make public one of the data-points from our members analysis as we believe it says a lot about the individual ecosystems in the Nordics, as we reveal each countries reliance on International capital.
Although at first glance it may appear surprising that Sweden sees the lowest proportion of International capital making up its rounds, it actually makes a lot of sense, as the Swedish investment ecosystem is much mature than in their Nordic neighbours.
There’s simply more local money available, meaning there is no need for a strong reliance on International capital with domestic money so readily available, and as such, this makes up the majority of the investment rounds.
40% of funding rounds in 2016 containing at least one International investor in Finland is staggering, but there’s positives and negatives to draw from this. On one hand it’s great that Finland can easily attract International capital, on the other hand, it presses home the lack of local funding options, something that Dennis Mitzner elaborated on here: Finland: The early stage nation in need of late stage money.
Then we have Denmark, Iceland and Norway between the two extremes, showing their capabilities as places that are able to attract International capital, yet simultaneously not being overly reliant/attractive.
These percentages are very hard to interpret and to do so accurately requires us to consider and understand the wider picture as well, rather than just looking at the numbers.
For example, if the 13% was Iceland rather than Sweden, we’d say, ‘they are having trouble attracting International money’ whereas with Sweden we say ‘this demonstrates a strong local investment ecosystem’.
This hints at a tipping point that is likely around Finland’s current 40% mark, where the number begins to come down rather than rise, as the local investment ecosystem matures, as it has done for Sweden.
Denmark, Norway and Iceland will likely still need to see involvement from International investors rise, as the demand continues to outweigh local supply, as the local investment ecosystems in each country take time to evolve.
The conclusion that we can definitely draw from the above, is that all of the Nordic countries are capable of attracting International investment, but some need or desire it more than others.