Viking Magazine - February 2019 - 26

efore he talks about
what's changing in
Norway's business
scene, Arne Tonning
sets the stage by
describing what's been
there historically.
" Norway has historically had industries based
on natural resources, " says Tonning, a partner
with the venture capital firm Alliance Venture,
based in Oslo and Palo Alto, California. " In the
early days, it was fish and electrical power. And
since the 1970s, the oil and gas industry has been
dominant. "
Now, though, innovation is driven " more by
renewable energy than fossil fuels-which is a
good thing, " Tonning says. Norway's best talent
no longer goes automatically into the oil and gas
industry, instead " it goes into other things, like
building tech startups. "
A wave of new companies is cropping up in
Norway, based more on technology than on
geography and geology.
" There's a really large ecosystem of startups, "
says Kris Riise, who founded one of them, called
Unloc. There's " quick growth specifically in Oslo,
but also in Norway in general. "
* VOLATILITY IS THE MOTHER OF INVENTION *
Insiders in the startup ecosystem point to one thing
more than any other to explain Norway's wave
of tech entrepreneurism, and it's the oil market.
Global oil prices fell off steeply in 2014 and 2015
after a string of highs for several years. The effects
were seismic in Norway's economy.
The price drop shook loose talent that otherwise
might have stayed in well-paid oil and gas careers,
but it also changed the thinking of investors.
" If more mature industries are flattening out or
declining or bumpy, then [investors] are looking
for other areas to invest in that will grow, "
Tonning says. Early-stage " angel investors "
and venture capital firms are typically the main
source of funding for new companies, he explains.
But now the money market overall-industrial
investors, large investment funds, " family offices "
that manage private wealth-is interested in
Norway's next generation of tech companies.
" I think the decrease in the oil price was very
much an eye opener to the Norwegians, " says Pål
T. Næss, director of entrepreneurs and startups
for Innovation Norway, a government agency that
fosters economic development. " When the oil price
goes from $110 down to $40 or $50 a barrel, most
Norwegians understand that we need more legs to
INVESTMENTS ON THE RISE
Norway saw a record number of investments
and a record value of investments in its new
technology companies in the first part of 2018,
part of an upward trend that's been unfolding over
several years. The total of 67 private equity or loan
investments during the first half of 2018 was a
76.3 percent increase over the same period a year
earlier, according to financial news site " The Nordic
Web. " The amount of money invested in the first
half of 2018, just under $186 million in value, was up
69.7 percent from a year earlier.
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26 VIKING FEBRUARY 2019 sonsofnorway.com
http://www.sonsofnorway.com
Viking Magazine - February 2019

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