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Finnish startups raise almost EUR 1 billion in 2020

FVCA managing director Pia Santavirta underlined the direct link between the record domestic investment total with attracting foreign investors.


Finnish startups raised a record 951 million euros of growth funding last year, representing a two-fold increase from 2019.

Finnish startups have continued to show their potential to investors in spite of the ongoing pandemic, in what has turned out to be a bumper year for investments in 2020. Companies such as HMD Global, Wolt and ICEYE were just three of the multitudes to attract significant funding rounds last year.

“Without the global crisis and a possible recession ahead, we would not have been raising a round, but it’s our responsibility to do everything we can to be there for our employees and partners,” explained Wolt CEO and co-founder Miki Kuusi, after the company announced a 100 million-euro financing round in May 2020.

Delivery service provider Wolt had another bumper funding year in 2020, attracting over 100 million euros in capital. Image: Wolt

Overall, venture capital investors contributed the largest share of the 951 million-euro investment pie, a total of some 495 million euros. This represents growth of more than 200 million euros on the previous year’s total. Finnish investments in domestic startups also ballooned over the past 12 months, making up a little under a half of the total VC investments.

In addition to breaking records, this growth of domestic investment activity has also spurred foreign VC enthusiasm.

“Finnish investors’ activity also increases the amount of international investments, as 83 per cent of foreign venture capital investments made in Finland are made in cooperation with Finnish investors,” said Pia Santavirta, managing director of the Finnish Venture Capital Association (FVCA). “174 startups raised venture capital funding in 2020.”

The telephone manufacturer HMD Global was the recipient of the largest investment total in Finland in 2020, raising 195 million euros funding from the likes of Google and Qualcomm. Image: HMD Global

This successful cooperation between entrepreneurs and investors has seen Finland become one of the fastest-growing startup hubs in Europe.

“Expanding international networks will continue to be important so that an increasing amount of Finnish companies receive help so that they can develop into a globally significant growth company,” commented Janne Holmia, the chair of the board at the FVCA and from Verdane.

Other investors, such as larger companies and pension funds, invested a total of 370 million euros into Finnish startups in 2020. Crowdfunding, meanwhile, drew approximately 50 million euros.

Space tech startup ICEYE landed around 74 million euros in funding in 2020. Image: ICEYE

The pandemic had a direct impact on the private individuals who invest their own wealth into startups. These business angels invested a total of 36 million euros in 2020, a drop from 2019’s record figure of 54 million euros. In light of the pandemic, business angels trained their focus more on supporting existing companies in their portfolio rather than actively seeking new investments.

Nonetheless, angel investments still broke records in exits made by investors: a total of 171 exits took place, up 68 per cent from 2019. In spite of the challenges of the pandemic year, the number of loss-making exits remained stable, standing at 37 per cent in 2020.

2020’s figures represent almost double that of the previous years. Image: FVCA
By: James O’Sullivan