Thoughts on ecosystems: a quick look at Norway

Thoughts on ecosystems: a quick look at Norway

Astia Angels organized an investor trip to Norway to learn about the entrepreneurial ecosystem in two cities: Oslo and Bergen.  The catalysts were our fellow Astia Angels Johan and Kristin Odfjell who joined Astia about two years ago while living in Silicon Valley and who recently returned home to Bergen, Norway.  The Odfjells moved with their family in 2016 to Silicon Valley explicitly to study entrepreneurship and venture capital funding from the region that is the global center for VC and entrepreneurship. They, like all Astia members, have an international perspective on entrepreneurship and investing.


Our Astia Angels delegation consisted of the two managing directors of Astia, the CEO of Astia, about eight angel investors plus two portfolio companies.


Our time in Norway was a whirlwind of activity. We started off in Oslo to take part in many activities during Oslo Innovation Week. Astia has a lot of experience putting on high quality programming for entrepreneurs and investors, building on twenty years of experience supporting high growth entrepreneurship, and Oslo was jammed full of programming with multiple local, Norwegian partners such as DNB bank, Grundr (a local consultancy for startups), Professional Women’s Network, Silicon Valley Bank, and others.  


Personally, I participated in a panel about investing with two fellow Astia investors as well as the CFO from one of our portfolio companies, Rated People. One characteristic of our panels is that we put an emphasis on being candid and transparent so our panels often take the format of an “ask me anything” and we find that entrepreneurs appreciate that rather than another lecture about being passionate about you company.


The CEO of Astia Sharon Vosmek was the supreme ambassador, delivering up to three keynotes in one day which made me exhausted just thinking about that. 


To get a real feeling for Oslo’s entrepreneurial economy, we met with key local investors at a dinner sponsored by Silicon Valley Bank. One of the Norwegian investors launched a discussion about how Norwegian startups tend to go public at an earlier stage than they do in other markets, especially the United States.  This investor commented that these Norwegian companies are true “unicorns” because they achieve a billion dollar valuation while facing the scrutiny of the public markets as opposed to many US companies that choose to stay private and claim “unicorn” status. (Note: unicorns are companies that achieve a valuation of a billion dollars).  In the United States, angel investors and venture capital have seen the time to exit for investments dragging out longer and longer because there is a lot of access to private equity plus merger and acquisition activity is slow. When this happens, early stage investors have less and less liquidity, and that can slow down the engine of early stage startup growth.  Angel investors and seed stage venture capitalists specialize in identifying, funding, supporting, advising and nurturing early stage company.  Without liquidity from previous investments, we cannot continue this cycle.  So, the Norwegian entrepreneurial system seems to have some interesting advantages.


A key element of any Astia Angels trip is to meet as many entrepreneurs as possible.  On our agenda we had pitch competitions to judge; we held roundtables with entrepreneurs in small groups; and we held a series of twenty minute one-on-one sessions with entrepreneurs.  Because we had so many angels in our delegation, we got a good look at the ecosystem. There were several companies that we were very interested in following up with in the future. Some of the angels were quite enthusiastic about some companies. I think my proclivity is to have a more measured response. I like to see how companies fare when they go through the Astia Expert Sift before I get too enthusiastic, but I definitely saw some targets of opportunity.


After Oslo, we took a scenic six-hour train ride through the mountains to the western coast of Norway to Bergen. There we met a group of investors who come from a variety of industries. It was our impression that in Bergen, there were closer connections between industry and entrepreneurship than in Oslo. In fact, while in Oslo, some impressive entrepreneurs were from Bergen (including the winner of the pitch competition). We find this to be typical in markets where there isn’t a well-developed venture capital or angel investment community. Because Oslo is the capital, it draws most of the venture capital activity. Consequently, Bergen-based startups seemed to be more closely connected to industry and to some extent the universities as well than in Oslo which attracted a lot of app developers.


The industries where Norway in general and Bergen in particular have deep sector experience are shipping and ocean-related technology, oil and gas, and environmental. We did meet with consumer product companies, medical devices and other industries, but we were aware of the dominance of these other sectors.


Overall, this trip to Norway reinforced for me how important it is to get out and visit different markets. Most angel investors prefer to invest in companies in their local market, and it is important to support your local ecosystem, particularly if it is developing. One of my favorite things, however, is to see what is going on in different markets and share, connect and compare companies and markets. Astia Angels is structured to be both sector and geographic agnostic, which hopefully means that we are finding better investments.  Or, at least it means that we are able to bring a broader market view to our portfolio companies and to our investors.