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Keep an eye on Norway: Its startup scene is about to go huge

Norway has been a bit of an underdog in the Scandiwegian startup scene for a few years. Need proof? Quick! Name one Norwegian startup that isn’t the obvious one… But despite not basking in the limelight, it hasn’t exactly been withering away in the shadow of the relative successes of its other Scandinavian brethren either.

For one thing, partially in response to the cratering price of oil — on which Norway has traditionally been heavily reliant — the Norwegian government has doubled down on supporting startups both financially and through training and advice, with what appears to be one of the most supportive environments for startups I’ve come across yet.

A strong level of support is going to be important for a number of reasons: In a lot of successful startup ecosystems, there’s a strong drive to help new startups. This may take the form of ‘smart money’ (i.e. investors who don’t just drop money into the startup for equity, but also offer advice, contacts, or other ways of championing their investments), procedural advice, or operational know-how. For example; if you are in a very active startup ecosystem, it’s possible to get a lot of advice around how to set up employee share options, how to deal with operational challenges, or how to deal with brand protection or patenting. Peer learning is a powerful first step to form a baseline for what to expect before getting swept away by lawyers and accountants — in a new ecosystem, the peer learning isn’t as readily available, and seeing the government working with the startup scene to help plug that gap is refreshing.

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Keep an eye on Norway: Its startup scene is about to go huge

Posted 2 hours ago by Haje Jan Kamps (@haje)

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I spent a lot of my formative years in Norway, and have been periodically checking in on the Norwegian startup scene. The first time I went and had a look around was about five years ago, and what I found back then was pretty dismal. So, when I headed back to Norway this week to take a deep dive into the Norwegian startup scene at the Startup Extreme conference, I have to admit: My expectations weren’t that high. And boy, was that unfounded. In just a few short years has gone from been a pretty bleak affair to being a real — if nascent — startup ecosystem.

Norway has been a bit of an underdog in the Scandiwegian startup scene for a few years. Need proof? Quick! Name one Norwegian startup that isn’t the obvious one… But despite not basking in the limelight, it hasn’t exactly been withering away in the shadow of the relative successes of its other Scandinavian brethren either.

For one thing, partially in response to the cratering price of oil — on which Norway has traditionally been heavily reliant — the Norwegian government has doubled down on supporting startups both financially and through training and advice, with what appears to be one of the most supportive environments for startups I’ve come across yet.

A strong level of support is going to be important for a number of reasons: In a lot of successful startup ecosystems, there’s a strong drive to help new startups. This may take the form of ‘smart money’ (i.e. investors who don’t just drop money into the startup for equity, but also offer advice, contacts, or other ways of championing their investments), procedural advice, or operational know-how. For example; if you are in a very active startup ecosystem, it’s possible to get a lot of advice around how to set up employee share options, how to deal with operational challenges, or how to deal with brand protection or patenting. Peer learning is a powerful first step to form a baseline for what to expect before getting swept away by lawyers and accountants — in a new ecosystem, the peer learning isn’t as readily available, and seeing the government working with the startup scene to help plug that gap is refreshing.

HRH crown prince Haakon of Norway. Photo by Dan Taylor/Heisenberg Media.

HRH crown prince Haakon of Norway. Photo by Dan Taylor/Heisenberg Media.

In addition to the government, the Norwegian royal house has thrown themselves into the mix. HRH crown prince Haakon of Norway (which, given he is next in line to the throne, means he can legitimately be called King of the North, right?) opened the event with a funny (“In 1600 we invented clocks and started being late for everything”) and engaging speech about the history of innovation and entrepreneurship both in Norway and beyond.

Leveraging the luxury of having a small startup scene — necessarily so, the whole country only has a population of 7m — the government-led startup support infrastructure is reaching a tremendous proportion of Norwegian startup companies. Of course, accepting assistance in any shape is voluntary, but the ease with which it is available is head and shoulders above what other governments in Europe are able to offer.

The size of the ecosystem also means that it quickly becomes a tight-knit community. That could arguably go both ways, of course, but at least the channels of communication are open. My impression was that it appears that if your startup is able to formulate the right question, chances are pretty decent of being connected with the right persons to help you find a solid answer.

The Startup Extreme event was interesting — and oh so very Norwegian — in itself. It was extremely inclusive (people graciously switched from Norwegian to English whenever I joined a conversation; I didn’t let on that I speak fluent Norwegian), and the recurring feedback was that absolutely everyone was very approachable; unusual at startup conferences and, in my experience, downright rare in Norway. Day one was a pretty straightforward conference, but at the end of the day, the majority of participants were loaded into buses for the extreme part of Startup Extreme; Two days of sky diving, wild water rafting, eating sheep’s heads, and staying up until the sun sets (i.e. never) was all on the menu. And, with this being Norway, the next point on the program was drinking as if your liver is an invading enemy force that can only be repelled by viking-immobilizing quantities of aquavit. It sported the perfect mix of activity and downtime to give its participants an opportunity to have the sort of deep conversations that makes this type of event worth while.

Five years ago, I found that the startup scene in Norway had a handful of players and very little support infrastructure to go with it. Today, it’s a completely different world. I look forward to diving more in depth over the next few months, but here are a few tasty morsels to get you started…

If you’ve tried to build a ‘smart home’ recently, you’ll have spotted that most devices are pretty dumb; or at least they’ve been struck by the Tower of Babel curse: Getting them to talk to each other is bloody hard. Starting with their home market in Norway, but rolling out internationally later, Futurehome is one to keep an eye on.

Children suffering from long term illness often struggle with crushing isolation issues, and according to No Isolation‘s CEO, 80% of children with severe disabilities have no friends at all. This is the problem the company is tackling with a product launching later this year; a fantastic startup than can hand-on-heart say they’re making the world a better place.

Wear an armband and your drone will fly slow (or fast) circles around you as you make a half-hearted attempt at avoiding to kill yourself on the ski slopes. Very impressive tech; if you’ve not heard of Staaker yet, don’t worry; soon, you won’t be able to avoid it.

Nabobil is taking on Turo, Getaround and co with some truly astonishing numbers

Nabobil (Norwegian for ‘Neighbor Car’) is a sharing economy for cars platform – much like Getaround et al. The company is showing some truly impressive traction, and while it’s currently only serving the local market, it has some ambitious expansion plans up its sleeve and a pretty impressive plan of how to get there. Definitely one to keep an eye out for.

I was surprised to find a fish food company winning a startup pitching competition; but on closer reflection, it’s the perfect story to illustrate why Norway’s isn’t like other startup ecosystems.

All the startups I can’t talk about… yet

A number of the startups I met with in Norway — both as part of Startup Extreme and separately — aren’t ready to share their full stories yet. But they will be, and when they do, you know where to come looking for you – that’s right; your favorite green-mastheaded tech site. Stay tuned.

France’s Convargo wants to connect shippers with truckers

The young company is also announcing that it’s raised €1.5 million from a very long list of investors. They include Xavier Niel (Free and Kima Ventures), Rocket Internet’s own Oliver Samwer, Jacques-Antoine Granjon (Vente Privée), Pierre Kosciusko-Morizet and Olivier Mathiot (PriceMinister), Jean-David Blanc (Allociné and Molotov), Marc Menacé (Menlook), Clément Benoit & Benjamin Chemla (Resto-In & Stuart), and Thibaud Lecuyer (Dafiti).

In addition, Convargo has perhaps smartly picked up support from a range of transportation industry folk, including Roger Crook (former CEO of DHL Global Freight Forwarding) and François Bourgeois (founder of French leading freight exchange Teleroute and 3617 LAMY).

Phew.

But back to what exactly the startup does. Operating a model that sounds similar to U.S.-based Trucker Path and Cargomatic, Convargo’s platform connects shippers with local carriers, including facilitating the booking process.

It claims to let you get a quote and book a shipment in just 3 clicks, while giving you access to thousands of local carriers. Through the app you can track the position of your goods in real time, and receive immediate proof of delivery upon arrival.

For the carriers themselves, the startup promises to send them more business and reduce overheads as it’s effectively a cheaper middle person, with lower overheads itself. The usual online marketplace play, you might surmise. Interestingly, I’m told that 90 per cent of carriers in Europe have fewer than six trucks, so it’s a highly fragmented industry.

Maxime Legardez, co-founder of Convargo says, “with scale, and using an algorithm, we aim to fill the trucks so that carriers can operate up to 100 per cent capacity. Right now, about 25 per cent of European trucks drive nearly empty. It’s an evidence of the enormous amount of blatant inefficiency in this industry, which has direct collateral impact such as excessive exhaust emissions.”

Asked why he quit Vaniday, Legardez told me he started thinking about Convargo at the end of last year and that after dozens of meetings with key people from the industry he became convinced “this was simply an opportunity I would never see again and a huge opportunity to add value to a key sector of the economy”. Now, along with a number of other freight marketplace startups, he’s attempting to make that opportunity count.

Gapping up
M&A news: MRO +3.2% (acquires PayRock Energy Holdings for $888 mln), PRGO +1.4% (to sell its US vitamins, minerals, & supplements biz to International Vitamin)

Select EU financial related names showing strength following Brexit polls suggesting UK to remain in EU:RBS +8.6%, LYG +8.1%, BCS +7.8%, PUK +5.7%, DB +5%, HSBC +3.9%, ING +3.7%

Select large EU names trading higher: IHG +7%, SHPG +5.1%, AZN +4.8%, VOD +4.7%, GSK +4.7%, SNY+3.6%, MT +3.9%

Select oil/gas related names showing strength: CHK +8%, BAS +5.7%, YNDX +5.5%, SDRL +5%, WLL+4.4%, BP +4%

Other news: NVCN +35.5% (announces 'positive' results from a study using the Reducer product were published in The Netherlands Heart Journal documenting 23 consecutive patients implanted with Reducer to treat refractory angina), FATE +25% (receives FDA Fast Track Designation for ProTmune), CERS +11.8% (to receive up to $180 mln of funding over 5 years to advance its INTERCEPT red blood cell program), INO +5.5% (enters into At-the-Market Equity Offering Sales Agreement to sell up to $50 mln shares of common stock from time-to-time), ALLT +4% (continued strength), FCX +3.8% (copper futures up 1%+ this morning), JD +2.6% (rumored to be near a deal to acquire Walmart's (WMT) Yihaodian, according to Marbridge), HOLX +1.7% (FDA approves emergency authorization for Aptima Zika virus assay), AGN +1.5% (presents new data highlighting in vitro activity of Avycaz against several species of Gram-negative pathogens), GAIA +1.3% (announces extension to of the expiration date of its previously announced tender offer to purchase shares of its Common Stock), CXRX +1.2% (announces 'positive' findings from analysis of Photodynamic Therapy with Photofrin clinical data; settles arbitration with former financial advisor),CLRB +1.1% (files for 300,006 common share offering by selling shareholders; proposed max offering price $3.785/share), MNK +1.0% (granted orphan designation by the FDA for hydromorphone hydrochloride for the treatment of complex regional pain syndrome)

Analyst comments: YELP +5.9% (upgraded to Buy from Hold at Deutsche Bank), EXPE +5.4% (upgraded to Overweight from Neutral at Atlantic Equities), CTLT +2.8% (upgraded to Buy from Neutral at BofA/Merrill), SYMC+2.7% (upgraded to Buy from Sell at UBS), CMTL +2.2% (initiated with an Outperform at BMO Capital), UA +1.6% (upgraded to Buy from Neutral at Buckingham Research), GLW +1.4% (initiated with a Buy at Citigroup)

- firm thinks now is the opportune time to sell SJM as a solid FY16 performance on multi-faceted tailwinds potentially reverses

- firm raises their FY17e and FY18e EPS to $6.29 and $6.62 from $6.26 and $6.42 respectively, introduces FY19e EPS at $7.03

Bercy espère, en 2016, récolter plus encore qu'en 2015. L'année dernière, la cellule de réglarisation avait rapporté 2,65 milliards d'euros aux caisses de l'Etat.

La régularisation des repentis est une vraie aubaine pour le gouvernement. Qui plus est en cette période de reprise progressive de la croissance. 1,9 milliard d'euros pour l'année 2014, 2,65 milliards en 2015 et plus encore en 2016, selon Les Échos qui cite le secrétaire d'État au Budget. «Le service de traitement des déclarations rectificatives (STDR) produira en 2016 des recettes équivalentes, peut-être même supérieures aux recettes produites en 2015», a déclaré Christian Eckert devant la commission des finances du Sénat mercredi après-midi. Contacté par Le Figaro, l'entourage n'a pas souhaité donné de chiffre précis arguant que «les nouvelles prévisions n'ont pas encore arrêtées». Pour l'année 2016, Bercy avait prévu, dans la loi de finances, de récolter 2,4 milliards d'euros. Mais les anticipations du gouvernement sont généralement inférieures aux recettes réellement récoltées. En 2015, 2,65 milliards d'euros avaient ainsi été engrangés, contre 1,7 milliard d'euros initialement prévu dans la loi de finances.

Pour expliquer cet optimisme, Bercy avance deux explications: d'une part, à peine plus d'un tiers des dossiers déposés ont été traités et d'autre part l'effet «Panama Papers». Le ministère des Finances espère que la révélation de cette affaire en avril dernier pourrait encourager de nouveaux contribuables à régulariser leur situation. Si tous ne sont pas obligatoirement des fraudeurs, une bonne partie d'entre eux a vraisemblablement cherché à échapper au fisc. Sur les 7800 dossiers traités en 2015, 515 avaient un lien avec une société écran implantée» dans ce pays. Ce qui a entraîné 760 millions d'euros de régularisation. Reste à présent à connaître l'ampleur des montants restant à officialiser. A l'époque, le chef de l'État avait déclaré attendre «des rentrées fiscales de la part de ceux qui ont fraudé».

La mise en garde de la Cour des comptes

Pour «accueillir» ces potentielles nouvelles demandes, la cellule de régularisation, mise en place en 2013 par Bernard Cazeneuve, ministre délégué du Budget à l'époque, doit voir prochainement - courant juillet (?) - son nombre d'antennes régionales augmenter de trois pour passer de sept à dix et ses effectifs globaux, de 159 à 209. Depuis sa mise en place, ce dispositif a permis à l'État de récupérer près de 30 milliards d'euros d'avoirs qui viennent alimenter les recettes de l'impôt sur le revenu et de l'ISF ou encore les donations et les successions. Pourtant, le nombre de demandes de régularisations est en train de stagner: de 1800 nouvelles déclarations par mois il y a un an, soit à peine 300 de plus par mois sur la période allant de fin mai à fin décembre 2015. Un montant divisé par plus de six!

A lire aussi:Qui sont les 45.000 Français repentis fiscaux?

De son côté, la Cour des comptes, lors de son dernier rapport publié en février dernier (page 381), mettait en garde contre le profil éphémère de ces recettes. «Les recettes exceptionnelles procurées depuis 2014 par le STDR ne sont pas pérennes, puisqu'elles sont en grande partie constituées de rappels d'impôts et pénalités sur exercices antérieurs qui prendront fin lorsque le traitement des régularisations sera achevé», expliquent les Sages.

Two shopping developments have changed hands for lower prices than expected, raising concerns the property industry is playing “catch-up” with the structural changes affecting the retail sector.

Intu Properties, the FTSE 100 property group, confirmed at the weekend it had bought out its joint venture partner in the Merry Hill estate near Birmingham for £410m in the year’s biggest shopping mall transaction.

Australia’s Queensland Investment Corporation (QIC), which owned the stake, had originally marketed it for £500m a year ago, said Robert Duncan, analyst at Numis Securities.

Meanwhile, Intu’s rival Hammerson said on Monday it had sold the Thurrock shopping park in Essex to TH Real Estate for £93m, representing a £26m profit for the vendor but still coming in “marginally below book value as at December 31, 2015”, Hammerson said.

Mike Prew, analyst at Jefferies, said that while the two assets were very different, both were affected by “negative pricing trends”.

Mr Duncan added: “The valuers are still playing catch up when it comes to retail valuations more broadly. We are starting to see retail properties trading at weaker valuations, which may be the start of a trend.

“The role of physical retail is changing hugely. It’s not worth what it was before — space is less productive and it’s more about showrooming than selling.”

Many landlords are offering incentives such as rent-free periods to attract good retail tenants, which may not be fully taken into account by valuers, he said.

Valuations were hit slightly by an increase to stamp duty on large commercial property transactions in March, while worries over the EU referendum have also affected the property investment market.

However, Mr Duncan said there were wider concerns over whether retail property values could continue rising given the structural impact of ecommerce on the industry. Property revaluations due later this month would shed more light on the direction of prices, he said.

The collapse of two retailers, BHS and Austin Reed, this year highlighted the challenges to the sector.

Investment into retail property was down 54 per cent year on year to £1.6bn in the first quarter of 2016, the weakest quarter in four years, according to CoStar, a research group. It attributed the drop to the “ongoing impact of the internet and latent concerns over rental growth in non-prime”.

Intu bought the Merry Hill stake from QIC using a £500m loan facility. QIC made a capital loss of more than 20 per cent, having bought the whole of the centre in 2007 at the top of the market, according to Mr Prew. Intu had pre-emption rights on the remaining stake, having bought 50 per cent in 2014.

An ebullient 21-year-old French video blogger may not appear to be an obvious antidote to advertisers’ fears about the rise of ad-blocking software, but partnering with Enjoyphoenix has proved highly effective for L’Oréal.

The cosmetics company and global advertising heavyweight is working with a growing number of online “influencers”, including the French YouTube star and make-up reviewer as a way of varying its online offering — but also to circumvent ad-blocking apps.

“This is really about creating greater content and experiences, greater formats for our consumers — especially in an age where ad-blocking is going mainstream,” Lubomira Rochet, L’Oréal’s chief digital officer, told the Financial Times.

“The whole thing that ad-blocking is pointing to is classical advertising fatigue,” she said. “We need to reinvent the experience and we need to make it less interruptive, more immersive, more rewarding, more personalised.”

The rise of ad-blocking apps has caused turmoil in advertising, throwing into question the effectiveness of “traditional” online methods for reaching customers, such as banners and video adverts on websites.

Pagefair, which helps advertisers get around blockers, estimated last month that more than 200m people now use some form of ad-blocking software on their laptop or desktop computers, as do more than 419m — about 22 per cent — of the world’s 1.8bn smartphone users.

To deal with that problem, L’Oréal has struck deals with homegrown stars on YouTube, Instagram, Pinterest and other internet sites. Getting video bloggers to talk about and review its products helps the company avoid paying for banners and videos, which are prone to being removed from viewers’ screens by ad-blocking software.

Some of the arrangements are financial, which L’Oréal says it always discloses. For example, it is working with five YouTube vloggers in the Middle East with a combined subscriber base exceeding 22m.

Other deals go further, such as in the case of Enjoyphoenix, who now appears weekly on L’Oréal’s Maybelline YouTube channel. She has made 66 episodes to date using L’Oréal’s production facilities. Enjoyphoenix has nearly 2.5m subscribers on her main YouTube channel.

“This is really a reinvention of marketing models in an age of ad-blocking and an age of selfies and influencers,” said Ms Rochet. “That is a huge shift.”

Striking arrangements with online reviewers and other popular vloggers can deliver potent results that go beyond circumventing ad blockers. When Zoella, the UK-based vlogger, did a spontaneous and unpaid review of the latest offering from L’Oréal’s The Body Shop brand, sales of the product doubled during the following four weeks.

L’Oréal last year spent €7.4bn, or 29.1 per cent of sales, on advertising and promotion, according to company accounts. The company said digital accounted for 25.5 per cent of net media spending.

Ms Rochet said so-called “earned media”, such as working with online influencers, was growing as a proportion of the company’s media mix spending. “We are changing the way we craft our advertising,” she said. “And we are absolutely also working with influencers.”