Finland’s Billion Dollar Babies

It is no surprise that top-tier angel investors and venture capitalists from Europe and the U.S. have been flocking to Slush, a start-up conference in Helsinki.The phenomenal success and high valuations of Finnish start-ups Rovio, Supercell, and MySQL are creating lots of interest in this Nordic country. Europe still doesn’t build that many billion-dollar Internet companies. Informilo looks at how Helsinki ended up being home to three of them.

Rovio, the gaming and entertainment company co-founded by Peter Vesterbacka, a featured speaker at DLD14, is behind the widely-popular mobile game Angry Birds. The company, which has branched out into stuffed animals, a Hollywood film and its own theme park, has been valued at anywhere from $2 billion and $9 billion in the press.

Supercell, a four-year-old tablet-first gaming company, launched two iPad games in 2012, one in late June called Hay Day, the other in August, called Clash of Clans. One instantly became a global hit, the other a blockbuster, and the company has been generating eye-popping amounts of money ever since. "Supercell had the fastest revenue growth of any start-up Accel has ever invested in worldwide,” Kevin Comolli, a partner in the London office of Accel Partners, told Informilo in 2012. Given Accel’s track record — it is an investor in the likes of Facebook, Wonga, Qliktech and Rovio —that is saying something.

Supercell’s strong growth also attracted investment from Atomico, the venture firm founded by Skype’s Niklas Zennström, and the attention of Japan’s Softbank, which purchased 51% of the company for $1.5 billion in 2013.

Then there is Finnish open source database MySQL, which was sold to Sun Microsystems in 2008 for $1 billion and is now owned by Oracle. Monty Widenius, the main author of the original version of MySQL, has since launched MariaDB, a massively-popular and highly-scalable new database for cloud and Big Data applications, which he has rolled up into a Finnish consulting company called SkySQL. And he is one of several founding partners at Helsinki-based venture firm Open Ocean, which was formed to help European entrepreneurs build similarly scalable software companies.

One of Open Ocean’s missions turns out to be helping Widenius build what could be his next billion-dollar venture. Ocean Capital invested seed money in SkySQL and participated in a $20 million round last October that was led by Intel Capital; other investors included California Technology Ventures, Finnish Industry Investment, and Spintop Private Partners.

"SkySQL, which we joined in the seed round, was really a no-brainer investment for Open Ocean; there was a very clear market opportunity forming with Oracle's support for the MySQL community decreasing, and the best team in the world for this particular business had left Oracle to start the company,” says Tom Henriksson, a partner at Ocean Capital. Longer term, we see that SkySQL could become bigger than MySQL ever was.”

Europe still doesn’t build that many billion-dollar Internet companies, so how did Helsinki come to be home to three of them?

“All the journalists say the decline of [Helsinki-based global mobile phone manufacturer] Nokia gave birth to the start-up sector but it is not the case,” says Petteri Koponen, a founding partner at Lifelong Ventures, a €30 million early-stage fund and one of Supercell’s earliest investors.

“If I think about the best start-ups, the ones that have attracted funding or have provable traction already, there are very, very few funded by ex-Nokia employees, and even companies we back which have hundreds of employees don’t have that many ex-Nokia engineers,” says Koponen. “The bigger indirect effect is that entrepreneurs feel that since we no longer have Nokia here it is their responsibility to kick butt and get things done to strengthen the ecosystem.”

While Nordic VC firms such as Northzone, Creandum and SunStone Capital have been active in Finland for a long time, the big change over the last few years is that “tier one venture firms such as Index, Balderton, Accel Partners and others are much more active in Finland,” says Koponen. Lifelong Ventures has 37 companies in its portfolio and more than half of them have attracted venture capital from outside the Nordic region.

“Another big difference between the year 2000 and today is we now have serial entrepreneurs who are founding their second or even third company,” he says. Start-Up Sauna, which runs the Slush conference and an accelerator program aimed at budding entrepreneurs, is very active; most nights there are networking events involving various parts of the tech sector.

Though Helsinki doesn’t have “Stockholm’s momentum,” says Nikolaj Nyholm, a Copenhagen-based partner at Sunstone Capital who has been actively investing in the Finnish market for four years, “there is definitely something happening now.”

“Many of the people starting new gaming companies have the same roots in the demo scene in the early '90s,” says Nyholm. “In reality it is a very small and tight-knit group and they have been able to assist each other very, very fast. Gaming is by far where most of the money is going. And why investors are visiting more frequently. In reality the other countries are at least a generation behind in gaming.”

It was Kristian Segerstrale, the CEO of Playfish (now owned by EA) who introduced Accel’s Comolli to Ilkka Paananen, one of six co-founders of Supercell, all of whom have deep experience in gaming. Paananen, Supercell’s CEO, is the founder of Sumea, which developed games like Yo Yo Fighter which were distributed via mobile operators such as Vodafone, O2, Orange, AT&T, T-Mobile and Cingular. Sumea was sold to Digital Chocolate in 2004 and Paananen served as the acquiring company’s CEO for six years. In 2010 he quit Digital Chocolate and rounded up a team of people from gaming developers like Remedy Entertainment to form Supercell.

Now some of Supercell and Rovio’s developers are leaving to create the next generation of games in Finland, says Nyholm (see the chart).

But it would be a mistake to believe that gaming is the only game in town for start-ups. Finland has played a pivotal role in the global open source movement. Linus Torvalds invented Linux in Finland before moving to the U.S. and, for example, the open-source IMAP server Dovecot, the world's most-used IMAP server with some 2.7 million installations and over 50% of the global IMAP server market, also has its roots in Finland (see the chart).

As for Widenius? He says he is ready to take on Oracle again, proving that the ambitions of Finnish entrepreneurs don’t stop at gaming — or at the border.

New Finnish gaming companies started by entrepreneurs who previously worked for Rovio and/or Supercell


Gaming company

Founded by



Antti Stén, CEO, Founder, ex-Rovio

Tuomas Erikoinen, CCO, Founder, ex-Rovio

Ilkka Halila, CTO, Founder, ex-Rovio

Received seed funding from Finnish investor Jari Ovaskainen and seasoned games investor London Venture Partners (“LVP”) in November 2012


Andrew Stalbow CEO, ex-Rovio

Petri Järvilehto COO, ex-Rovio

In November 2013 received $2.35 million in seed funding from Los Angeles-based Upfront Ventures, and Sunstone Capital, which is headquartered in Copenhagen and is one of the most active independent venture capital investors in the Nordic market

Next Games

Joakim Achrén

Co-Founder, Chairman & CPO at Next Games, ex-Supercell

Teemu Huuhtanen, co-Founder & CEO, ex-Rovio





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