Why Stockholm is a great city for entrepreneurs
Publish date: 24 October 2023
Innovation is in the air in Stockholm, driven by a strong profile in tech and a culture of cooperation. It’s what led to the birth of unicorns like Spotify, Skype and Klarna, and how the city earned its global reputation as a breeding ground for entrepreneurial talent.
“We’re in a comfortable position, but what I love about Stockholm is people take that comfort and add a lot of discomfort! They try to solve hard problems. Perhaps it’s inspired by the Nobel Prizes being here and Sweden being a key contributor in driving global development,” says Innocent Mugenga, entrepreneur and founder of EdTech startup Learnability.
Nobel Prizes aside, Stockholm’s innovative climate is no happy accident. An abundance of hubs, co-working spaces, incubators and accelerators can be found peppered throughout the city. The stage is set for entrepreneurs from all backgrounds to meet, share knowledge and ideas, and support one another’s business ventures.
The mood is one of collaboration, says Innocent, adding that while there are many different clusters of entrepreneurs there is still plenty of interaction with “people always looking to understand how they can help each other.”
He believes that this absence of rivalry is in part thanks to various venture capital firms, angel funders, and initiatives that invest in and support early-stage entrepreneurs. Some are private but others like Vinnova, Sweden’s Innovation Agency, and Almi, which provides loans and advice for budding businesses, are run by the state. As a result, entrepreneurship isn’t limited to the elite and anyone with a good idea has as much chance at success as the next person.
“There’s a lot of funding to support the early stage ideas and help to get them off the ground. I think if we had to struggle more, if we didn’t have all this support, maybe there would be more of a scarcity mindset. And the process is not hard to get the grant. So I think that gives us a healthier mindset, where we’re not competitive against each other.”
A worldly scene
Another quality of Stockholm’s entrepreneurial ecosystem that Innocent finds appealing is its internationalism. Nearly half of the people he interacts with come from outside of Sweden, and often the business language is English. Multiculturalism is more than welcomed, he says, it’s seen as a major advantage.
“Most of the startups here think globally almost immediately. So it helps to have people within your team who have experience of another market and perspective from another country to really think globally about expansion.”
This openness to new ideas and new faces is among the reasons Innocent says that Stockholm is the perfect city for so-called ‘wantrepreneurs’. He describes this group as people who “want to be entrepreneurs, or are about to be entrepreneurs”, and who are seeking new skills, collaboration and idea validation.
“Stockholm is a good place because you have a lot of people you can reach out to. You can pitch part of your idea and get feedback, ideate with others, and work on things like your value proposition. You can do it all in an unpressured space, and get into the industry or vertical you’re interested in before actually starting up.”
The unicorn factory
The many meet-ups hosted by the various hubs, co-working spaces and startups are good places to start for anyone eager to build a network. The events are open to everyone interested in pursuing the entrepreneurial path, and a stomping ground for many of Stockholm’s more established businesspeople.
“You bump into someone and you’re easily introduced to the next person. If you’re out and about in these places, you will probably meet someone who is looking for something,” says Innocent.
This is further supported by Sweden’s proclivity for flat hierarchies, organisations with few to no management levels. Established entrepreneurs and CEOs are more accessible, and often more willing to support people who are in the early stages of starting a business.
“It’s a lot easier to get introductions to the top VCs and speak to people in higher positions. There’s a lot of intermingling between the new entrepreneurs, but if you reach out to experienced entrepreneurs then I would say there’s a high degree of them getting back to you.”
It’s just one example of the pay-it-forward attitude that’s become so common in Stockholm. With support in place for entrepreneurs at every stage of their journey, the way is paved for the next cohort of creative minds and, more than likely, the next wave of Stockholm’s unicorns.
“Since we have this system where the state invests in startups, we have previous successful cases. So this really fuels the ecosystem. There are people who have had success, who understand the entrepreneurial journey, and they support the next entrepreneur both financially and in competency. They’re trying to find the next ‘them’, I think.”