You may have already heard that Starttaamo is making some noise over in Oulu, Finland. For a small startup organisation, they are doing remarkably well. Their members have raised a total of 20-25 million EUR, out of which over 10 million EUR comes from non-public sources.
This is especially impressive, considering that Oulu is a small town of 150 000 inhabitants located just 160 kilometers away from the Arctic Circle. We can only guess that this is where the perfect Finnish combination of dire colds, a lot of beer and hot saunas works best. Alternatively it can be Starttaamo’s entrepreneurial spirit, “can do” attitude and no government funding allowed policy, that is helping them achieve these results.
“We do things, we do not ask” says Teemu Polo, one of the co-founders and Chairman Of The Board of Starttaamo ry. For instance when they had the idea of starting a co-working space, they had no funding and tried to find a landlord who would be aligned with their goals. Eventually they found one that agreed to the “one day we will pay the rent, promise.” rental agreement.
Many organizations would do things completely differently, such as trying to secure the funding first and then focusing on acquiring an affordable space. Starttaamo’s entrepreneurial spirit works differently, they simply do things. Right away.
They are also a very confident bunch with a can-do attitude. Thanks to which, they are able to host a lot of events, coaching sessions with the likes of Peter Vesterbacka of Rovio, hackathons and much more. In addition to external speakers, VC’s and investors, they also have very active local members such as Eero Kaikkonen who sold his company Hantro to On2 which was later purchased by Google and Juuso Nissilä founding CEO of Valkee.
Finally it is interesting to note that perhaps because of the cold and absolute fearlessness, Starttaamo also has a strict stance towards government funding and is trying to avoid it as much as possible while tapping support from the private sector.
According to Polo, one of the reasons for this is practical. They view themselves as entrepreneurs and value their independence without a wish for having to report to higher powers. After all, if you are supported by the government you need to file reports and stick to your plans, making it hard to be agile and play around with ideas.
“When we started driving this thing, we wanted to be more idealistic. We did not want to see direct support for the organization. People should be driving towards sponsoring results vs. sponsoring structures and organizations.” says Polo.
That is not to say that they encourage their members to stay away from government support, on the contrary as entrepreneurs and CEO’s in their day jobs it makes sense to get any help you can get. However as an organization, on a more idealistic level, this is something they choose to stay away from.
We also briefly discussed the efficiency of using tax payers funds in order to support companies and this is a complicated discussion with a lot of pro’s and con’s.
One of the arguments that can be made is that government funding is dropping the cost of entrepreneurship, which in turn should increase the quantity of entrepreneurship. However you also need to consider the effects on overall output of the economy, effect on wages and alternative ways to spend the money such as entrepreneurial education. So if you are up to the challenge, feel free to discuss the use of government funding as entrepreneurial subsidies in the comments.
Nonetheless, Oulu is bringing a lot of new companies to the table such as, Bitbar, Fingersoft, Brightsign, Fantastec, InterestID, Soljuva and Valkee. Oh and you might think that this is a fairly new phenomenon, but you should take into account that the worlds first public NFC user, Worlds 1st GSM phone call, Worlds 1st 3GPP phone call and Europe’s first free urban area WLAN network all come from Oulu.