Nordea launched its own Startup & Growth Customer Unit in Finland in 2016, however in practice the unit was initiated in 2011. Nowadays, Nordea serves 2500 startup and growth companies in Finland. The unit’s aim is to be a key player in helping growth companies & startups boost growth through their key position in the Finnish Business Ecosystem.
Nordea is currently the only bank in Finland to cater most of the startups and scalable companies. As a whole, they serve 75% of the startups and scalable companies together.
Close to 65% belongs to the startups in the market (they come from other banks after finding out Nordea’s offering and also through word of mouth from existing Nordea customers), and 85% of all the scalable companies in Finland.
However, this unit is the only one of its kind in the Nordics. We had a chat with their Head of Startup & Growth Customer Unit, Vesa Riihimäki, about their first year of operations and future plans.
Q: Tell us about the current team working in the unit.
“We are currently 29 people in Finland and there is a team restructuring going on in all countries. After a few weeks, we will be in a setup where we will be 13 persons in Helsinki and most likely 12 in the other cities in Finland. The change means that in the other Finnish cities, they will start to have their own portfolios of purely scalable companies.”
Q: How are the plans for a Startup & Growth Unit in the other Nordic countries going forward?
“In Denmark, operations have been running already for half a year with a 3 person team. They have been gaining several startups as customers so they are really moving forward. In Oslo, something similar has happened and they just recently appointed a team leader. Sweden is still under development but the unit has been running for almost half a year.”
Q: What are some of the most important milestones from the unit during the past year?
“Last year we reached 250€ million in portfolio loans for startups in Finland, and since we started it has been more than 350€ million that we’ve granted loans for startups & growth companies. Also last year, with InnovFin we managed to deliver an 80€ million loan with a state guarantee. During April this year, we might be having that new program again but this time with 200€ million.”
Q: Are there any important observations you can point about your offering for startups and any trends you’ve noticed within the past year?
“Based on the 5 years we’ve been in the market the ecosystem keeps on growing every year. There are more startups and there are more equity providers. There is also more loans to startups because of us. The quality of the startups and their pitches, the founders and how professional they are has been picking up year by year. Also, looking ahead, we have also been very active with VC funds. Last year we were active with 3 different funds where we had a limited partner role and that is something we want to continue pushing.”
Q: How does the future of the startup ecosystem look like to you?
“From our point of view, the reason of why we want a Nordic setup of our unit is because we understand that there are no borders in the Nordics. When it comes to the ecosystem, there will be even more players and more different instruments coming into the field. I definitely believe it is going to be much more difficult for startups and growth companies to understand what is available and what is good for them because it is now for them pretty difficult.”
Q: In this future setup, what is Nordea’s advantage?
“There are still banks that don’t like startups & growth companies. Many of them think it is risky business, especially during the early stages. Then, during the high growth phase, not just in the Nordics but also all over EU, banks want to stay away. That is something that differentiates us, out of the 2500 startup & growth customers we have, 1300 have a loan from us. That is clearly a number that differentiates us from other banks. We’ve been on the market for 5 years, and we have learned what are the challenges but also what works for different startup businesses, so we know our customers.“
Q: In a nutshell what are some of your actual offerings to startups?
“Right now we are building into shape our “Crowdfunding” service. We are also running every 2–3 months our Venture Funding Events, where we pick up companies from our portfolio companies that are seeking for equity and we invite them together with our private banking customers for a 2–3 hour pitching session. We have done one SME bond and are very active in changing the scope of that product. Lastly, we have our Trade Portal which is free to use for everyone where you can seek for relevant info of local markets and conditions through our business partners globally.”
Q: Talking about portfolio companies, how does a startup or growth company become one of your portfolio companies?
“Just call us and we will have a chat. We are looking for scalable business models. If we believe that yours is, most likely we have a deal.“
If you want to read more about Nordea’s Startup Growth Services go here.
About Nordea’s Startup & Growth Unit
Nordea’s Startup & Growth Unit specialises in serving high-growth companies and companies in their early stages looking for fast growth. They want to build long-term customer relationships and be the partner that supports businesses to grow and succeed throughout their life cycle.