The small Northern country of Sweden has claimed its position as the ‘Startup Capital of Europe’ in international media. And to be fair, it has really succeeded in living up to that reputation. Sweden is actually the one country that has more unicorn companies per capita than any other in Europe, with major tech companies such as Spotify, Skype, and Klarna all having Swedish roots.
With all these high-tech companies coming from the Scandinavian country, American investors and venture capitalists have started to keep a close eye on the next Swedish startup wonder. But how come there’s so much success in one small country? We have talked to some of Sweden’s top entrepreneurs to get their view on the entrepreneurial life, along with some inspiration on how to succeed in a tough and competitive world.
Entrepreneurs = hopeless optimists?
Behind every successful entrepreneur stands a hopeless optimist, if you want to believe the Swedish innovator Alexander Hars. He has been aiming to change the way that many different industries think, by injecting his ideas into new businesses. His latest endeavour is to change the bedsheet industry with the company Alva, which sells ecologically produced cotton.
“For me, optimism is about thinking everything is possible. You don’t necessarily have to be an optimist, but it makes the entrepreneurial life easier”, he claims.
Being an entrepreneur can give you a fantastic feeling of freedom, but it can also be a true roller coaster, Alexander Hars explains.
“You have your peaks where you think you can take over the world, but then you have your downs when you think you’re screwed and have to apply for a 9-to-5 job again.”
His advice to other entrepreneurs is to not think too much about things before you put them into action.
“It surprises me at times how easy it is to get things done. Instead of being afraid of making that call, you should just pick up the phone. It’s all about daring to do the things you think of, get yourself up and just get it done.”
Being an optimist is one thing, but some curiosity can also take you far. For the entrepreneurial duo Stephanie Bergström and Erik Magnuson, that’s exactly where it all started: With curiosity and a driving force. Nine years later, their cashmere sweaters have reached 40 million SEK in sales. Soft Goat was set up to sell cashmere sweaters at a nice price, after the two entrepreneurs noticed all cashmere clothing was quite expensive.
“Our business idea is to sell cashmere products from our online store straight to the end customer. By doing that, the consumers don’t have to pay for the expensive fees that might be added from physical stores”, Erik Magnuson explains.
“One example of our curiosity is that we have really looked into the production of our sweaters to get an understanding of how they are produced”, Stephanie Bergström adds.
She also points out their transparency as a key factor in their success.
“Our customers appreciate us being transparent when it comes to our production. We use many different providers throughout the journey, and when customers understand how complicated it can be, they have big respect for the product.”
When it comes to giving entrepreneurial advice, Stephanie Bergström has something valuable to share. According to her, many new entrepreneurs become insecure in the early stages.
“You get confused and start doing other things instead of taking care of the one thing you started doing. One part of our success is that we have believed in our idea from the beginning and held on to that throughout our journey”, she says.
The key to success
Pär Svärdson is Sweden’s response to Jeff Bezos, being the co-founder of Sweden’s first online bookstore Adlibris and online pharmacy Apotea. He founded Adlibris in 1997, two years after the launch of Amazon.
And talking of Amazon, Adlibris was almost sold to Jeff Bezos back in the day.
“Jeff Bezos and one of his Europe managers were in Stockholm, arranging a meeting at The Vasa Museum, to which the whole local book industry was invited. The event was very strange, I must say. Everyone wondered what their intentions were. They were very, very vague and said things like ‘We really love you’, ‘Customers here are great’, ‘The book industry here is great’. But this was when we approached Jeff Bezos. We said ‘If you are establishing Amazon in Sweden, our company is the one you should buy’. He did get interested. It made much more sense to enter this market at that time than it does today. Sweden was way ahead of the rest of Europe in terms of internet infrastructure”, Pär Svärdson says.
The deal was never sealed and there’s still no Amazon in the Swedish market. But Pär Svärdson continued on his entrepreneurial path, ultimately selling Adlibris to Bonnier. In 2011, the founders behind Adlibris bought the pharmacy “Familjeapoteket”, which now is known as Apotea.
With such an extensive e-commerce profile, he has a lot of great advice to give. One of the keys to success, according to Pär Svärdson, is to be extremely involved in your business – and not only on a higher level.
“I personally place two orders a week from my store to experience exactly what customers are going through. That is enlightening. For example, I’ve realized that we put products in too large packages sometimes, too big to fit through a letterbox. Unnecessarily big packages delay delivery and are bad for the environment. By being a customer, I also noticed that we were using too much plastic, which led to a decision to cut our plastic filling by half and replace it with more sustainable materials if necessary. I also have a network of colleagues and friends who order things from us and report their experiences to me. It works really well. If they get poorly packaged products they send a picture to me. That happens too often. I send those pictures to our warehouse staff, and ask them what’s going on.”
Another piece of advice that Pär Svärdson wants to share with other entrepreneurs is to just get started and fight hard.
“Be prepared to work slightly longer days than just 9 to 5. Also, never go in the same direction as others.”
Hard work pays off
Unsurprisingly, hard work seems to be one key ingredient in the recipe for success. Stefan Palm is the founder of Lager157, a clothing warehouse that sells affordable clothing. Back in 1997 he opened the first store in the Swedish small town Gällstad. Today, their sales are heading towards 1 billion SEK.
20 years back when the first store opened its doors, Stefan Palm had the same thought in mind as he still has now:
“There’s only one way to go, and that is to work even harder. As long as I can work harder, I’m going to make it.”
And Stefan Palm has always worked harder.
“When I started my own business I got to the office at 6.30 AM, after commuting for some time. I got back home at 9 PM to have dinner with my wife. When she fell asleep a few hours later, I started working again”, he says.
Swedes don’t trust their bosses
In 2000, Daniel Mühlbach founded his first company Lensway together with his friend Herman Ofenböck, and he has been in the e-commerce industry ever since. Lensway is one of Europe’s biggest online stores that sells contact lenses and glasses, but in 2010, Daniel Mühlbach decided to leave the company to start his next one. This time around, shoes were his main focus as he launched the online shoe store Footway.
As founder and CEO of his own business, Daniel Mühlbach strived to create a working environment that made it possible to evolve and improve.
“We constantly evaluate ourselves by looking at how much we have learned and how much we have been teaching others. We also challenge each other to learn new things. Every quarter we have a challenge where you have to learn something new, which can feel a bit scary at first. But if you put your mind to it, you will soon see that you actually can do it.”
In his years in the e-commerce industry, he has noticed something interesting in the Scandinavian culture.
“What’s interesting about the Scandinavian culture when it comes to organization, is that we stand out from the rest of the world. According to a study, Swedes think that their boss is only right 20 percent of the time. That shows that we’re constantly challenging others’ opinions, which is a great strength”, Daniel Mübach says.
So, what stands behind Sweden’s entrepreneurial success? Could it be the fact that Swedes don’t trust their bosses or the fact that they seem to be hopeless optimists?
Either way, there seems to be a lot of hard work behind every success story. But don’t forget to have a Swedish fika break every once in a while.