risto siilasmaa

Gemalto Acquires Valimo Wireless For Undisclosed Sum

Gemalto, provider of end-to-end security solutions, has acquired a Finnish startup Valimo Wireless. The terms of the transaction were not disclosed. Some of Valimo’s investors included Altine Group, Risto Siilasmaa and SpringBank TechVentures.

Valimo has developed a two-channel, two-factor authentication based on Public Key Infrastructure, combining an over the air platform with a software client in the SIM to generate a legally binding electronic signature. What this jargon from the press release means is that Valimo enables mobile phone users to securely authenticate themselves, digitally sign documents and confirm legally binding transactions simply by entering a self-chosen passphrase or a PIN code. Voilà!

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Fruugo Secures More Financing From Current Shareholders

fruugoAccording to a Finnish business periodical, Talouselämä, Fruugo has secured more financing from its current shareholders, Jorma Ollila, Risto Siilasmaa and others. We previously wrote about Fruugo laying off 40% of its staff to cut its burn rate. At the moment, 25-30 people work at Fruugo.
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Dodreams Receives A Major Investment From Top Finnish Investors

DodreamsDodreams Oy, a Finnish MMO-gaming company, has received a major investment from some of the top Finnish investors working with early stage companies. Dodreams offers portal and media companies tournament system software and services to combine MMO gaming with mass media. They recently worked with MTV3, the largest commercial television channel in Finland, to launch and host the Maailmannopeinkansa.fi -game (translates to world’s fastest people). The amount of the investment was not disclosed, but the investors are Veraventure Oy, Risto Siilasmaa (F-Secure founder), Optiomi Invest Oy and the private investor Klaus Berner. The amount and status of the investors in the Finnish ecosystem puts the investment, with my educated guess, roughly in the area of 500 000 – 1 000 000 €.
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Government Backed Accelerators Chosen – March On Finland!

vigoVigo, a Finnish government run program to strengthen the currently rather dismal foundation of Finnish risk capital ecosystem and to create international venture accelerators and investors in Finland (see our previous story here), has come to an end and now it’s time to see what we got. And it does not look that bad at all.

In total, three venture accelerators where chosen by the steering board, which was lead by Mr. Risto Siilasmaa, Chairman, founder and former Chief Executive Officer of F-Secure Corporation, Member of the Board at Nokia and a prominent business angel among other things. It seems that the Vigo steering board was looking into finding teams to cover various different industries and compliment each other instead of creating competition into the Finnish venture capital scene. They seems to have found three such ‘mutually exclusive’ teams to fit the bill, namely Lifeline Ventures, Lots and Veturi Venture Accelerator. Here’s a short description of each in turn.

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Fruugo Burned Through 14,5M€ In 2008

fruugoFruugo has burned through 14,5 million euros in 2008, according to an article in Kauppalehti. Last year’s books show (in Finland these are public for all limited liability corporations) that Fruugo’s net loss for the year is 14,5 million euros and with no income, this is the investment Fruugo used in 2008.

Fruugo is the much debated startup from Finland that has gathered a lot of media attention in the recent year. One of the reasons they have done so is their attractive and well known board members that include Risto Siilasmaa (Founder, F-Secure), Jorma Ollila (former CEO and Chairman of Nokia) and many others. Fruugo’s main product is a webshop that would aggregate all the different webshops into one.
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Frosmo Secures A Class Angel Round

FrosmoFrosmo, a Finnish based skill gaming company, has secured an angel round from highly distinguished investors and individuals according to Kauppalehti. The size of the investment round has not been disclosed, but the investment round included 6 individuals; Risto Siilasmaa, Hannu Vaajoensuu, Kirsi Eräkangas, Markku Toivanen, Jarkko Veijalainen and Klaus Berner. Kauppalehti tells that the investment will enable the company’s strong growth overseas – so it is a relatively large angel round.

Frosmo is company developing a browser based skill gaming service, very much like that of King.com – the world’s largest and most popular casual skill gaming community. Frosmo’s main markets are in Eastern Europe and Asia – not the most common country’s of operations for a Nordic company. Nevertheless, Eastern Europe has been a growing market for casual games in the recent years.

Frosmo has some 40 000 players daily. While their main site may not be the fanciest of sites on the internet, they tailor their service to customers through partners. In Finland they have partnered for example with MTV3 to host their service TopKani.fi which is a lot more user friendly and attractive.

Connected Day Attracts Popular Board Directors

ConnectedDayThe Finnish business paper Kauppalehti has dugg up some interesting facts about ConnectedDay, the Finnish based startup that focuses around photographing and videoing children in day care centres. The photos and videos can then be shared with parents wanting to have an eye on their children while at work.

Sari Baldauf, a former Nokia Networks chief, has invested into the company and now owns 25 percent stake in it. Risto Siilasmaa, another well known investor has invested into the company with a 35 percent stake in it. According to Timo Airisto, CEO of ConnectedDay, Siilasmaa and Baldauf are seen as both investors and mentors to the company.

According to the Finnish tax authority, the company had no revenues in 2007 and according to Airisto, last year was still in the red, but they are looking to break even this year.

Fruugo’s Ownership Structure Revealed

Fruugo logo

Adding to the yesterday’s news on Fruugo’s service launch plans, just this morning the Finnish business media Talouselämä has published the ownership structure of Fruugo.

Risto Siilasmaa, founder and chairman F-Secure, is the biggest owner with 30,9 % share. Fruugo’s founder and Evangelist, Nils ”Nippe” Forsblom is the second biggest owner with almost 30 %. Risto Siilasmaa came aboard in the very beginning and brougth in Nokia chairman Jorma Ollila and the ex-CEO Reijo Syrjäläinen. Jorma Ollila owns 9,4 % of the company. A year ago, Seppo Sairanen (the previous main owner of FIM financial group) invested in the company, and last summer the Finnish media group Sanoma, who’s Kim Ignatius recently entered the board. Sixth biggest owner is Kalle Vuoristo, the CTO of Fruugo.

The full ownership structure of Fruugo, as published by Talouselämä:

Ownership %
First Fellow (Risto Siilasmaa) 30,9
Queensway Dev. (Nils Forsblom) 29,2
Kestrel (Jorma Ollila) 9,4
Optiopaja (Seppo Sairanen) 6,8
Sanoma 5,9
Kalle Vuoristo 5,0

According to the article, Fruugo has burned around 10-15M  euros so far, maybe even more. They have slightly above 60 own employees at the moment, plus tens of consults.

Fruugo is an aggregator bringing the online web stores under one service. Pan-European web commerce is still difficult, but through Fruugo the European web stores can sell their products to the whole Europe, and all consumers can buy the products of all merchant integrated with the service, using their native language and local payment methods. The business model, as we reported yesterday, is based on transaction commissions. The cut Fruugo takes is around 10 percent, more or less depending on the product category. The company believes the rate is justifiable to merchants, as using the service Fruugo will take care of payment systems, fraud management, customer service, and currency exchange.

Fruugo’s public launch is coming up in Q2, but the exact countries are not disclosed. Next Fruugo faces the challenge to make itself known to the millions of European online shoppers.

(See our previous coverage on Fruugo.)

Fruugo Goes After EUR 60 Billion Market with One-Stop Online Mall

Fruugo logo

Fruugo, the ambitious Finnish e-commerce startup (see our previous coverage) has announced (see Reuters’ press release Tarmo Virki’s interview news below) the company is on track to launch closed beta still in January, as stated previously. The service will next open in Sweden by early February. The public opening is planned for April, while the news does not specify in which countries it will be available.

Siilasmaa states in the press release interview they “are working to create a European marketplace, so that all those merchants would find all those consumers and all consumers would find all those merchants.” Fruugo has said before the company wants to be the trusted 3rd party of e-commerce. Based on the latest press release news, this means Fruugo aims to unite the online shopping market by opening a “one-stop mall” for Europeans (Europe is the firm’s main target market for now, as it has declared before as well). Fruugo will have hundreds of links to different online stores available in its mall. This explains why the company has been using user experience and website optimization and monetization consults. The initiative could certainly become something big if the company is able to execute the vision.

The addressable market is around EUR 60 billion ($79.50 billion), the company states, half of the total online shopping market in Europe last year. As Fruugo stated in the autumn, it targets all consumer durables and content sold in physical boxes. According to the news, there are some 30 merchants currently integrated with Fruugo, while further 100 in the process. The merchants carry brands like Lego, L’Oreal, IBM, Nokia, Adidas, Lacoste and Nike.

The big question speculated a long time has been, what is the business model? Fruugo now states it does not collect any sign-up or monthly fees from the merchants, it only charges transaction commissions. Fruugo’s business model is said to mix “online retail with search and price comparison capabilities”, and in addition, social networking, which allows consumers utilize their online networks when seeking the best shopping deals. There isn’t more information given on the last point, but it certainly sounds interesting if Fruugo has created some way of utilizing social search (cf. Google speculations) while shopping for products, which might lead to much more relevant search results and recommendations.

Just recently, to add to Fruugo’s well-known board members Nokia chairman Jorma Ollila and founder and chairman of F-Secure Risto Siilasmaa, Kim Ignatius has joined the company’s board (the news in Finnish). Ignatius is Director of Finance and Administration in the Finnish international Sanoma media group, while he served before as Finance Director of TeliaSonera, the biggest mobile carrier in the Nordics. In the same General meeting the board also allowed usage of stock options. Sanoma has been very active in the past years buying internet and media startups so we will see if the corporation plays any role with Fruugo.

Apparently Fruugo’s cash position is healthy after all, as the owners are reportedly not after quick profits – Siilasmaa states confidently “The day will come when this firm is cash flow positive.”

See full press release interview news below.

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Risto Siilasmaa Keynote in Slush Helsinki

Risto Siilasmaa, the founder and former CEO of F-Secure (among other tricks of trade), kicked off Slush Helsinki last week with his keynote addressing the current economic situation. Mr. Siilasmaa is one of the most famous Finnish entrepreneurs of all time, having IPO’d F-Secure and now directing such companies as Fruugo, Nokia and others as a board member.

Apologies for the small ticks in the film, you’re not missing more than a few secs in total – technical glitches.

Slush Helsinki

There has been much talk around Slush lately. Yet, it has not yet been very clear at all what is happening and I’m partly to blame. Now I try to shed some light onto the issue and at the same time invite you all to Slush.

In a nutshell Slush is a new Helsinki originated event for startups by startups. The whole process started when I along with a few others passionate about the subject were trying to brainstorm on how to give a boost to the Finnish startup scene, home and abroad. We had an idea that a bigger annual event might be the answer for the lack of visibility among Finnish startups in the global arena. If nothing else, we saw that such an event was missing from the Finnish startup fabric.

After throwing ideas back and forth for while I, Peter Vesterbacka (of Mobile Monday fame) and Kai Lemmetty (of Floobs) came up with an event that would show the best Finland has to offer, once a year every year. Later on Helene Auramo from Zipipop jumped along to bring her positive energy to the team and give it an even stronger startup perspective. Peter came up with the name Slush and so it started.

Finnish summer can be an amazing experience with its nightless nights, but there’s also the dark winter we live with the other six months. Thus, any startup born in Finland have equal number of slushy and dark Novembers in their DNA as they have those warm sunny Julys. Many say the one quality a startup needs above all is perseverance against adversity and out of all the languages Finnish is the one that has its own word for describing just that. The word is Sisu and I believe that it has much to do with Finns pushing through those dark slushy winter months. Thus, an apt name especially for a startup event. Having said that, I believe this is the case with startup DNA all over the Nordic and Baltic countries.

After finding the right people to take on the challenge we were ready to start working. What we really aim to do is light up the startup scene, namely by showing students what entrepreneurship can be at its best, and show the international crowd that there is much more to Finnish startups than the tip of the iceberg they’ve seen so far. Naturally big part of the whole event is to enable the Finnish entrepreneurs meet not only each other but also investors and other businesses from home and abroad.

We know there’s a plethora of events that are not working as well as they could for the entrepreneurs themselves, and thus we decided that everything we do should be done in the interest of the startup scene in mind. If something is in conflict with that focus, it will be scrapped from the agenda. For startups by startups or nothing.

Now we are at a point where the website is up and running so we can tell people about the event, invite them along and spread the word. Even the fact that the website leaked out half ready turned out to be only beneficial, since many people wanted to help out. For example the nice guys at Valve volunteered to help out right away. I’ve also heard that the Bolder guys are ready to do their part and Scred has promised to make the actual platform for selling tickets for the event.

The event itself will take place 24th November at Korjaamo Culture Factory in Helsinki and run through the whole day. The program will be a combination of four parts:

  1. Success Stories – This is were we have the Finland’s finest web entrepreneurs lined up. Risto Siilasmaa from F-Secure, Petteri Koponen from First Hop/Jaiku, Ilkka Paananen from Sumea/Digital Chocolate, Asmo Halinen from Apaja only to name a few of the entrepreneurs that have started small and made it big.
  2. Technology track – This is modeled on the Startup Developer Gathering (SDG), which was put together by Kai Lemmetty. For Slush Kai is putting together a tech presentation bar none. This track will go on all day and have many Finnish heavy weights like Teemu Kurppa (Jaiku/Google) presenting their insight for the Slush attendees.
  3. Thirdly, a showcase where up to 40 local startups can show what they have, be it products, services, their team, philosophy behind the concept and what not.
  4. Fourthly, probably the most important reason pulling the event together in the first place, we have seven pre-screened teams presenting their business ideas to the audience. These teams will be funded by the Slush Fund. The Slush Fund will be in effect just as big as the combined sponsorship revenue plus the proceeds from the sold tickets will allow it to be. In another words we will channel all the money from the event (minus cost e.g. rent for the venue etc.) to the seven teams. If you are a student with an idea for the next big thing you should apply. Instead of writing code and making coffee at one of the big corporations next summer, you could spend the summer of 2009 working on your own idea and have the expertise of most of the Finnish startup community to draw from.

In a nutshell this is Slush Helsinki. An event for startups by startups.

If the website seems that it does not give out all the details yet, it is by no means because we want to keep you in the dark but rather because we are working on the agenda as we go along to make it as good as resources and time allow. ArcticStartup will be naturally reporting what is happening at the event itself but also how the event is developing from now until the day itself in late November. Welcome to the Slush everybody!

Edit: There was a mistake saying October instead of November. The correct date for Slush is NOVEMBER 24th.

Siilasmaa invests in Whatamap.com

Risto Siilasmaa (of F-Secure fame) has invested in Whatamap.com, a mobile map service, (more on Whatamap.com here) and is thus also bringing much needed experience to the company on how to build and scale a startup into a successful global player.

The parties did not disclose the specific sum invested but according to Whatamap.com the investment was ‘markable’.

Fruugo’s CEO shares plans with 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.

Fruugo's success formula

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.

Arctic Startup Exclusive: Interview with Fruugo CEO Reijo Syrjäläinen

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.

Internationalization insights at Verso Software Summit

Verso - Vertical Software SolutionsTEKES organizes Verso Software Summit as part of program November 5th in Marina Congress Center in Helsinki. Free enrollment by Oct 24th.

The event offers presentations given by experts such as Johan Zetterström (Salesforce.com), Risto Siilasmaa (F-Secure), and Seppo Ruotsalainen (PROFict Partners). After the keynotes round table discussions will follow where different cases are talked over lead by a variety of expert advisors. Topics cover different aspects of internationalization strategy and operations, including partnering, financing, M&A, and HR challenges.