Business development · 5 May 2016

Not just Vikings and brooding detectives: Micro business lessons from Norway

startup Norway

Informal is the new normal

“It’s very important to us that the StartUp Lab is not school,” emphasised Holmefjord.” Smart people are going succeed one way or the other. Probably, they’re not going to want to be lectured on how to do XYZ. Rather, they’re likely to want to find out where they have in issue, where they need some input and advice and then they’re going to come and ask. If you don’t have the ability to work that out, as an entrepreneur, you’re probably not going to be successful.”

The onus that this relaxed atmosphere puts on those trying to make a success of a young business has been difficult for Mathews to adjust to. “One of the biggest challenges of working here has been that, as a Canadian, we’re very open, and I’ve been growing a network for my entire life. There are solid formal mentorship programmes, people are used to taking others under their wings, and giving younger people a chance. In Norway you have to really earn other people’s respect, and work hard for that.”

The importance of informal learning is something which Holmefjord is evidently passionate about. “Just coming and sitting down and listening to someone talking, that’s not going to help you. There are so many good videos out there on YouTube – we’re not going to be able to teach you any better than that,” he argued.

“So we have lawyers, we have accountants, we have IP consultants. But they’re not giving lectures. They’re sitting in an office and you can knock on your door if you have questions, when you have those questions. Of course you save time and money compared with if you had to go an make an appointment. But, most importantly, it lowers the barriers, so you actually ask for help – it makes it more likely that you ask for help when you actually need it.”

There is a pervasive attitude in the Lab that learning doesn’t just come from these experts, but from the other people that small business owners happen to be chatting too over coffee, too. All of the management team have entrepreneurial experience –  Holmefjord’s in Silicon Valley – and he is a firm believer that quick chats rather than long, structured training days provide the best way to get this across to the resident business founders.

“It’s very efficient for us to work with these companies in this way – we can have five different ten minute meetings in an hour. We can do workshops too, but we can also just be there for a quick question, which again lowers the barriers to asking for help or asking for an introduction.”

More Silicon Valley expertise comes in the shape of Anders Eikenes, the co-founder of disruptive teleconferencing startup Kubicam. A former optical engineer at Norwegian firm Tandberg, he was part of the company when it was acquired by Cisco for $3bn. Despite being at the helm of a company with just 12 employees and one client, the fact that client happens to be Google puts him in a position that the majority of small business owners will never reach.

“All the 60 companies that have been here since it launched, it’s been very interesting to learn from all of them,” he explained. “We all help each other. We’ve just graduated in a way – our office is just outside the main StartUp Lab. But being able to pop in and still be part of the community here is invaluable,” said Eikenes. “I wouldn’t have met you if I hadn’t have been here, right?”

His final point was certainly an apt one. Our visit to the StartUp Lab, which was planned just a couple of days in advance, saw Holmefjord wander around the open plan space seeing if anyone wanted to talk to a British journalist.

Don’t forget about work-life balance

oslo

Across the whole of Norway, the average working week of 33 hours is one of the world’s lowest. With young companies famous for the 24/7 commitment they require from founders and employees, the idea that quite so low a commitment would be conducive to a successful startup seems inconceivable.

Indeed, for Holmefjord, a willingness to put in the hours when necessary is a key component of what makes a young company founder a promising contender for investment. “Do the team members show up early and work late? There’s a huge failure rate with any early stage business, and you need to have more than just a good product to overcome that.”

But there’s also a sense of pragmatism ingrained in the attitude of both the StartUp Lab manager and the space’s resident businesses. “Although I work at least 60 hours a week, the cultural focus on work-life balance definitely impacts on the atmosphere within the lab,” explained Mathews.

“We as a team are super-supportive of each other. We don’t believe in burning out, we don’t believe in not enjoying life, and we support each other on that. We work really hard, we have really tight deadlines, and we are very passionate about our work, but we’re also very understanding of one another.

“There’s no pressure to be able to say: ‘look at me, I was at the office for 12 hours today – there’s no one-upping each other. When I think back to Canada, and even living in Switzerland, it was very much about the clock. Here it’s a lot more about how to work effectively, get the job done and if you need to take a personal day, you take a personal day.”

The grass isn’t always greener on the other side of the world

In keeping with the incubator’s emphasis on caution, the founders of Domos Labs have been developing their cloud-based machine learning technology for three years. “We’ve created a software model that takes data from the router, analyses it, and kind of inserts rules to fix problems. At the moment, we are the only company in the world that can see this kind of data,” Berntsen explained.

Yet with three people working in Oslo ,and another three engineers working from Finland, the team is in no rush to graduate to Silicon Valley.  “For us, this is the perfect place to start, to test on a small customer base, then we can scale globally later,” he added.

With a population of just five million, Norway certainly provides a much smaller testbed than British companies are used to considering. But for the Lab’s manager, the business dynamics of larger neighbours also make inward-focused product development a good idea.

“There hasn’t been a single social network come out of Europe, because the countries are too small to get the upper hand. If you have the same idea in Norway and the US, you’re gonna win in the States, right?” Holmefjord argued. “If your competitive advantage lies in your market, you’re not going to do it here. It’s got to be about the product.”

“If you look at Nordic success stories like Skype, it’s been good technology that’s gotten in to bigger markets. Then in Sweden, Spotify’s founders used the smallness to their advantage. Record labels were never going to test something like that in the US because of the chaos it would wreak on their biggest market, so having access to a smaller customer base can actually be an advantage.”

Despite the fact that the music-streaming service is one of the Nordic region’s most famous success stories, he thinks that this mentality is more suited to business solutions than consumer goods. “When it comes to selecting teams to join the Lab, we tend to biased towards B2B stuff, because we think that has better odds of succeeding here,” Holmefjord explained.

At the same time, and in contrast to the openness to foreigners joining in the startup scene, keeping development local in the early stages of a business is something which is prized highly in the StartUp Lab. “We’re not super keen on having four business school students come in with an idea that they want to outsource to India. We want teams who can execute their own core product,” he explained.

In many ways, the comments sum up some of the most important aspects of Norwegian small business culture. As much as hard work and strong teams featured in our discussion, business plans, outsourcing and profit margins – words which it seems hard to imagine the entrepreneurial ecosystem in the UK doing without – were hardly discussed at all. In Oslo, small business owners avoid the hype and get on with working out what local customers want – UK-based entrepreneurs should sit up and take note.

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ABOUT THE EXPERT

Hannah Wilkinson is a reporter for Business Advice. She studied economics and management at Oxford University and prior to joining Business Advice wrote for Kensington and Chelsea Today about business and economics – as well as running a tutoring company.

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