Denmark has gained quite a reputation for supporting an overall positive business environment and fostering creativity and innovation – all of which have contributed to its capital city attracting the attention of global startups.
Before we jump into the post, here are a few quick facts about Copenhagen and its tech scene:
- The estimated population of Copenhagen is 1,280,371.
- Per capita, Denmark has the highest number of broadband internet connections in Europe.
- In comparison to other European capitals, Copenhagen has a relatively low number of startups per capita, as well as low numbers of high-growth SMEs. There is a perception that larger companies drive innovation as opposed to startups.
- The Global Creativity Index 2015 named Denmark the most creative country in Europe and is continually recognized in livability and happiness indices globally.
- Copenhagen ranked 5th in the European Digital City Index last year, scoring highly for its business environment, access to capital and non-digital infrastructure criteria.
With an unfavorable tax system and a perceived lack of entrepreneurial culture, Denmark may not be top of mind when it comes to flourishing tech hubs.
While the country may not fall into the mold of a typical tech center, it still has a great deal to offer – recently scoring high for a positive overall business environment supported by its access to capital and digital infrastructure criteria.
The country has become a hot spot for an increasing number of accelerators, incubators, co-working spaces and investment funds, all geared towards helping startups excel.
Considered one of the most digital economies in the world – Copenhagen was recognized as having the best business environment in last year’s European Digital City Index – it’s believe the country can offer unique business opportunities to global financial services companies.
“The highly developed digital infrastructure in Denmark is a product of the close cooperation between the public authorities and business, providing international financial services companies with unique access to developing new FinTech solutions and services,” Copenhagen Capacity stated.
Earlier this year, Denmark took the No. 11 spot on the global Digital Money Index 2016 by Citigroup, while also being ranked fourth in the Digital Money Solutions sub-index. The Danish government is working to grow the country’s 40 percent use of mobile payment services by supporting initiatives to wean people off cash, such as allowing certain retail outlets to stop accepting paper money.
“Denmark has traditionally had a high level of innovation and tech readiness within the financial services sector with close links to the established suppliers of IT and technology. Coupled with Denmark’s strong culture for collaboration between business and public authorities, Greater Copenhagen offers a unique environment for creating new and durable digital solutions,” Claus Lønborg, CEO of Copenhagen Capacity, explained.
The Copenhagen Difference
Though Copenhagen may be a tiny city in a small European country, it’s has still fostered several well-known unicorn startups, such as Skype, JustEat and Unity Technologies.
There are many factors that have helped Denmark to gain attention for being a place that’s able to attract the attention of burgeoning startups. One of the top reasons startups are choosing Denmark is the country’s quality of life.
“Denmark seems to have cemented its position at or near the top of every global quality-of-life survey. Now it also looks like a fertile ground for scale-ups: it shows 1.7 scale-ups for every hundred thousand people, which is 2.5 times the ratio in the U.K. and almost 6 times the average ratio in continental Europe. Not surprisingly, Denmark ranks third in the European Innovation Scoreboard,” Alberto Onetti, chairman of Mind the Bridge, explained.
The survey counted 96 startups in Denmark, which have cumulatively raised over $1 billion in venture capital funding or through the IPO channel. This figure accounts for 22 percent of the all startups mapped across five Nordic countries (430 in total, including Denmark, Finland, Iceland, Norway and Sweden).
Huffington Post Lifestyle U.K. also noted that the country provides easy access to the rest of Europe, an openness to new technologies and innovation and an increasing number of funding opportunities.
Startups in Denmark have access to public funding schemes, business angels, local and international VC investors, accelerators and global business development organizations.
Accelerance, a Denmark-based accelerator, attracted private funding of almost $200 million to startups in the country last year. Since it began in 2010, the firm has helped more than 250 startups raise over $269.5 million in funding and investments.
“The Danish scaleup ecosystem is still quite young, so international investors have a great opportunity to reap the fruits of Copenhagen’s booming startup scene,” Claus Lønborg, Copenhagen Capacity CEO, stated.