Arctic Startup

Fruugo, the new Finnish startup gathering loads of interest with Jorma Ollila and Risto Siilasmaa on board among others, has been in strict stealth mode. Today, CEO Reijo Syrjäläinen revealed a bit more about their plans to Arctic Startup in a breakfast meeting.

In short, Fruugo positions themselves as the “trusted 3rd party of ecommerce”. The major problem Fruugo sees and is trying to solve is in the internet ecommerce supply chain. Reijo described that purchasing from the web is still quite painful; you enter some product name to a search site, and from the thousands or millions of hits you need to figure out where you could and should get what you are looking for. Then, after finding some etailer, the next questions arise around whether you trust the seller, payment options, etc. Also for the etailer, especially in Europe as an example, it’s hard to deal with varying regulations, laws, taxes etc. in different countries.

Fruugo believe they can offer the consumers and etailers easier, simpler, and safer way to do web purchases. They see big inefficiencies in the current web ecommerce supply chain, and believe they can streamline it a lot. Reijo didn’t want to comment the business model nor the technical concept in detail yet. Fruugo is essentially a consumer company, and their marketing activities will be heavily focusing on creating buzz and interest in the internet.

Currently Fruugo is building the technology platform with especially scalability and partner integration automation in mind, and establishing partnerships with key players in the industry. The service will be available in closed Beta in a few months. So far Fruugo has “some plans” for including also mobile into the equation, people’s roots being strongly in the mobile world, but not right from the start. Reijo comments they naturally see a huge potential in the mobile web, as mobile handsets are becoming the main way of accessing web in many parts of the world.

So, what does the mystic equation 1L + 1M + 1P = ? on their web site stand for? There have been all sorts of wild quesses thrown in the air, but Reijo now reveals it’s simply “1 Language + 1 Mind + 1 Purpose = Success”. So it rather describes the company’s culture and mindset than its offering, as was speculated. They are building the company around a strong vision and hand-picked people with strong can-do attitude.

Reijo also states all the key supporters have positioned Fruugo for real success - they didn’t even think about establishing the company anywhere else, as all share the same love for Finland. They really want to show that it’s possible to create a top-notch internet startup here as well. Naturally Fruugo is going to bring more international color to their team, but the “heart and soul” will be Finnish in any case.

We’ll be revealing more about Fruugo later on as things progress. Also note that Fruugo will launch their renewed web site by Monday, with a bit more content than currently.

Habbo Hotel has registered one hundred millonth member. The user account was created in the UK. M&M, a Finnish marketing and advertising medium, has also stated in their news that in the five and half months of this year about 20 million new characters were created (3,5+ million a month).

M&M also reports on business figures (well, proportional at least). Sulake’s May 2008 is 20% bigger in terms of revenue than in May 2007. It is also said to be positive, making this year the first profitable one.

TripSay adds groups to its service, continueing on the strong community path. With groups, users of the service can more easily see what their peers in the same group are doing. Users can also add certain places to different groups.

Juha Huttunen, the CEO, commented groups in the following manner; “We added groups because they are a crucial element for finding people that share the same travel passions. With groups it is now again easier to find tips related to your interest. You can now easily find the places and tips recommended by e.g. fellow surfers or party animals. You can also create your own group with just friends too.”

With regards to their moving out of private beta, Juha Huttunen did not reveal all that much. The list of todo-items isn’t apparently all that long - I’m guessing they are in the final stages of fine tuning code and sorting out the communications things with regard to getting everything in-sync. The launch date is still unsure, but we’re guessing that its set for August.

This Friday, Arctic Startup will be among the first to know what Fruugo, the super secret Finnish startup with Jorma Ollila and Risto Siilasmaa on board, is really up to. We have received an invitation to a morning event this Friday.

Fruugo will be hosting a breakfast meeting with a few bloggers. Fruugo is taking this first step seriously as the host for the session is none other than their CEO Reijo Syrjäläinen. VP of marketing, Janne Waltonen does not want to reveal anything regarding the event, however he wants to point out this is one of the first initiatives to support their open attitude towards social and participatory media.

If we could ask just one question from the CEO, Reijo Syrjäläinen - what would you want to ask?

Disclosure: I have worked with Janne Waltonen on founding Gyllene Skor, he is also a share holder in the company.

I attended the Parteco picnic today, organised by Katri Lietsala and Esa Sirkkunen, who ran the Participatory Economy and Beyond -research project. It was a good event with old media companies slowly turning to social media (which I have to say shouldn’t be done only for social media’s sake).

I also heard some good rumours regarding the Finnish startup scene. First of all, regarding Dopplr - Marko Ahtisaari, Lisa Sounio and Taneli Tikka have left, or are leaving the company to continue to new challenges. Taneli Tikka is currently very active with his new startup RunToShop, which is creating some buzz among Finnish startups. The moves at the moment are not official, but there is a lot of buzz around that.

Juha Huttunen of Tripsay was also nodding towards August with regards to their official launch. Therefore we’ll have to wait a few more months before we will be able to see the service they are coming out with. I understand they are currently making final moves towards the launch.

Last, but not least - rumour or not - the Iron Sky movie, followup to the largest Finnish movie ever distributed - StarWreck, will be launched in 2010. Currently the script is being finetuned for the “investment round” that will be a few million euros and that will begin during the end of this year.

However, there was a lot of positive talk among the startups there regarding various issues and I also received a lot of great ideas regarding our next event.

Openbit, a Finnish Tampere based provider of on-device payment and DRM solutions for mobile applications, and Tanla Solutions, Indian telecommunications software and services provider have announced today that Tanla buys 85 % of Openbit for $US 15.81M / EUR 10.2M in cash. The valuation is therefore at EUR 12M, 23.5 times Openbit’s EBITDA (EUR 0.51M) from the fiscal year 2007.

The remaining 15% is still owned by the management and will be acquired by Tanla in two parts, 5% after the first year and 10% after the second. Openbit has been one of the fastest growing companies in Finland in terms of revenue growth, ranking third in the Deloitte’s Finnish Technology Fast 50 list of 2007.

Seems like a potentially very good match for both companies. Openbit should be able to expand their channels and partners faster in Asia and North America, and Tanla gets extensive foothold in Europe.
Congrats to Openbit for the work well done so far!

See Tanla’s press release (PDF) for more information.

Kuneri, Oulu based company founded in 2006, has won EMEA Regional Award in the Forum Nokia 2008 Code Camp Competition with their Easy Vote application. The contest was aimed at inspiring building Web Runtime (WRT) widgets and Flash applications.

The winner Easy Vote is a mobile Flash Lite application enabling users to vote by mobile phone call, text message, or Web service via rich user interface. Kuneri focuses on creating applications and tools for Flash Lite development mainly on the Symbian S60 platform. The firm also offers KuneriLite, an application development toolkit for Symbian/S60 stated to extend Flash Lite capabilities and allow creating applications without any Symbian knowledge.

Kuneri’s blog post.

It took a while, but it was worth it. The video is now ready and good to go for viewing. Feel free to leave any comments regarding the event or topic in the comments, we’re always looking forwards to developing our act.

Norfello, a software development and public web-based services company, has launched Postita.fi service (website currently in Finnish only, though the actual service offers English also), which allows the users to automate sending company letters.

After a simple registration one can start uploading PDF’s to the service. After transferring some money into the account with a credit card (instant) or bank transfer, uploaded letters can be confirmed to be sent. Postita.fi automatically prints and mails the letters in a standard envelope to the recipients, by the following day if the material is uploaded before 11am the day before. The total price for 1-page letter is quite affordable 1.02€ incl. VAT. I tested the service and it seems to work quick and smooth - seems like an easy way to get rid of printing and mailing letters, if you are fine with standard envelopes.

Norfello was founded in 2005, and according to the company’s web site they are privately held, have 13 employees, and are growing rapidly. The firm was recently part of the Finnish web 2.0 company group who made a field trip to San Francisco.

The company has previously introduced Laskulle.fi, which allows one to create PDF invoices by filling the simple form on the web site, free of charge and without registration in the basic version. It isn’t too hard to see the automatic mailing feature of Postita.fi being introduced to Laskulle.fi quite soon.

Norfello seems to sit somewhere middle in what comes to e-invoice services. E-invoices have gained a lot of attention lately, and there’s a lot of competition rising up in the SME segment. Verkkolaskut.fi is other Finnish-focused quite comprehensive service already (though the site brand is pretty poorly selected I’d say), among quite a big bunch of other small and bigger players. Might be Norfello tries a bit different approach to avoid the masses.

As Antti reported earlier we are closely following the Finnish companies that will be pitching to Israeli VCs at the IVA conference. Last Wednesday we had a chance to witness the final preparations of these companies for the event. Concilio Networks, Eniram, EpiCrystals, SenseG, and Whatamap did a dry-run of their pitches, which were then commented by seasoned professionals (incl. Jussi Harvela, Moaffak Ahmed, Pekka Roine).

Pitching is hard, if you want to do it properly. You have to keep your pitch length at eight minutes, you face a VC audience that sees thousands of pitches every year and you only have about ten to fifteen seconds to get everyone’s attentition. So what can you do? Here are some advice from the experts:

1) Focus, focus (never say “..and here’s a few more things you can do with our product”)

2) Reveal your value proposition first, then a concrete use case

3) Focus on a single benefit, provide ROI

4) Tell a story, but use a format (like news broadcasters do)

All the above-mentioned Finnish companies are in Israel at the moment. They will pitch on Wednesday, May the 21th and have many pre-scheduled meetings and events prior to that. We try to get a word from the field so keep an eye on our future coverage.