Category: Op-eds (Page 2 of 2)

Selling the Future

During a panel discussion a couple of months ago, a number of successful entrepreneurs from the Nordic countries (Iceland, Sweden, Denmark, Norway, and Finland) were asked what was the most difficult part about raising money here in Silicon Valley from a cultural perspective. One of the panelists said it was the fact that venture capitalists in Silicon Valley expected to be sold the future.

Gísli Ólafsson

Gísli Ólafsson

People in the Nordics are culturally very humble by nature. They are not used to bragging about their success and don’t want to exaggerate what they have accomplished. This becomes especially true for entrepreneurs from the Nordics. They are used to talking about what they have accomplished and not what they are planning to do. If you really push them, then you can get them to tell you what they are planning to do over the next few months, but looking 2-3 years into the future is often very hard for them.

I often get the opportunity to see as Nordic entrepreneurs pitch their startup to venture capitalists from Silicon Valley and I can confirm that this observation by the panelist is very true. As I work with entrepreneurs from the Nordic countries I constantly have to push them to sell the future – sell their vision – sell the true reason why they founded their startup.

A side effect of this cultural humility is that entrepreneurs also often aim too low in their funding requests. They often ask for funding to support sales and marketing in new territories, while leaving out requests for improving and continuing R&D. It is as if they think they should put everything on hold while they sell what they currently have…and then 18 months later they can continue development.

When you compare this to the typical American entrepreneur, who has almost been taught to sell their vision of the future from preschool, it is no wonder many of the non-US startups have a hard time getting funding from Silicon Valley. I often joke that in my new role my title should be Cultural Translator.

For those of you still reading…and still wondering why there is a picture of a moose at the start of this article…then it is maybe because culturally we would rather talk about Moose companies than Unicorn companies in the Nordics 🙂

Gisli is a Partner & CEO USA at Beringer Finance – his Twitter handle is @gislio

Norðurskautið covers the Icelandic Startup and Tech scene. Follow us on Twitter or sign up for our mailing list to keep up to date. You can also join our Slack community –

The Technology Development Fund Needs Refactoring

Yesterday the Icelandic Technology Development Fund announced what projects would receive grants in 2016. The TDF is funded by tax money and operated by Rannís, the Icelandic Centre for Research. It has been an integral part of early stage funding of companies, and many of Iceland’s most prominent technology companies have received grants from the institution at some point in their lifetime.

Kristinn Árni L Hróbjartsson

Kristinn Árni L Hróbjartsson

Yesterday’s list of 48 grantees includes a wide range of projects, from boot-strapped startups, to recently funded companies such as Sólfar, to university based research projects. (Sólfar is on the list for a Project Grant, typically $100,000 per year for up to 3 years. Sólfar announced a €2 million funding round 4 weeks ago.)

Interestingly, some of the companies don’t match the expected profile of companies needing grants. Instead they represent a regular member of the receivers of TDF grants: big, profitable companies, that seemingly should be able to fund their own R&D.

It sounds a bit strange, that Iceland’s biggest funder of early stage innovation and technology approved a grant to Hampiðjan, a multinational company started in year 1934 (not a typo) that reported €7.7 million in profits in 2014.

Similarly, this year a grant was provided to MS Icelandic Dairies. The company is a de-facto monopoly of milk products (we’ve heard horror stories and had resolutions and fines from the Icelandic Competition Authority on that company’s behaviour) a similar grant.

Both are project grants – usually around $100,000 per year for up to 3 years.

In 2012, Marel (publicly traded as MARL with a current ISK 183 billion (~$1.4 bn)), received around $170,000 for R&D. The same year, Matís, a government owned company (.ohf) received a 3 year project grant. That company is up to 30% funded by the Ministry for Industry and Innovation. (Matís has received grants from the TDF in 2013 and 2014 as well).

The reason for this is simple. The Technology Development Fund’s purpose is to fund technology development and research. These allocations are therefore (to my knowledge) according to its stated purpose and operating guidelines.

Is that however, what we want, and what the small but growing entrepreneurial, innovative community in Iceland, needs?

The Fund’s stated purpose is to “support research and development activities, which aim towards innovation in Icelandic industry.” It is broad and vague, and maybe purposefully so, to enable the fund to grant funding to a big variety of project. I think, however, that this purpose needs revisiting.

The Ministry for Industry and Innovation is today announcing its action plan to help entrepreneurs and startups. One of the likely big actions is increasing the funds available to TDF by ISK 975 million (~$7.5 million), bringing the total amount available for the year 2016 to ISK 2,347 million. That’s almost doubling the budget for grants.

Are we sure that this version of TDF is what we want, need and should have?

I believe, that before we start shovelling these massive amounts of cash into TDF, we should zoom out and think: Is there maybe a better way to do this?

My thoughts are the following.

First of all, I think it’s utterly ridiculous that tax-payer money is being used to fund the research of big, multinational, profit bearing private companies. This could be addressed in the fund’s rules.

Secondly, I think the fund’s focus should be made clearer. Funding everything from research in universities to the development of computer games is a very broad focus. The fund could be split up to adapt the application and selection process to each of these cases.

Thirdly, instead of adding this money to a fund that gives out grants, we should look into whether a matching scheme could work, similar to Israel’s Yozma, which matched VC investments coming into Israel.

The Icelandic startup scene is most definitely growing. We need to make sure that the support system grows with it, in the right direction.

Kristinn is a co-founder of Norðurskautið. He’s on Twitter as @kiddiarni.

Norðurskautið covers the Icelandic Startup and Tech scene. Follow us on Twitter or sign up for our mailing list to keep up to date. You can also join our Slack community –

Failures and Job Hoppers

Society is one of the most influencing factors on how we shape our career paths. We all want to place ourselves as an ideal marionette of those entitled to pull the strings and define the rules of the game. Some of you may already know how dropping out of school is labeled as an act of irresponsibility and some of you may already know the feeling of being discredited by colleagues, friends or family who lack the nerve to rip up the roots and move on to greener pastures, whether it be a new job or an entirely new venture.

Kristján Pétur Sæmundsson

Kristján Pétur Sæmundsson

Nowadays, we have access to vast amount of information that can help us get the necessary feedback to validate our plans. Startups create a wide range of opportunities and by doing so, they tend to scream for attention wherever they can, in hope of attracting great talent.

Most of them fail, become mediocre and in a sense unsuccessful, while some close millions in risky seed rounds. I think we’ve managed to grasp the fact that going out on a limb, taking a chance by risking everything on one turn of pitch-and-toss, for the slim possibility of building something significant and worthwhile, might be the best place to align your mindset with your end goal. Furthermore, such ventures are likely to accumulate knowledge that not even one of the best schools could ever teach you – you have to make your own decisions.

I am sure you’ve read books and articles on success stories from entrepreneurs, leaders and companies that seem to somehow stand out from the crowd. They wrap you up in the idea of success, but often fail to mention the importance of failure on the way.

Too often do we give little regard to those whose doors close long before they are opened –  those who fail small and early. The startup community gives credit to failure, but only when it comes to well known companies, the media help in growing into successful role models, only to watch them fall apart, giving us the idea that they “fail gracefully”, in order to rise up even stronger, adding more value to their comeback.

Seldom do we pay attention those who struggle on their way towards success and fail too soon, not focusing on the importance of the paradoxical side-effect of failure – the learning experience that comes along with it. As long as you are fully committed and as long as you put all your energy and efforts in it, success and failure go hand in hand, giving you important feedback to learn about yourself.

This lack of regard is also valid for those sometimes referred to as “ job hoppers”, those who, for one reason or another, have changed jobs frequently in the past. In terms of employment, we often put too much emphasis on searching for educational background and honorary degrees. A short tenure doesn’t constitute failure, just as an equally long formal education doesn’t constitute success.

The fact is that cultural fit, challenging environments and appropriate development are just as important to the employee as they are to the employer, and they hold the right to assess their relationship with the employee regularly, just as the employer does towards them.

I for one would probably qualify as a job hopper. I have held four positions in different companies, in less than four years. Each of them forced me to adapt, learn and expand my vision upon different procedures and strategies. Every “hop” made me able to take on new matters with a range of previous experiences to draw from.

I challenge you to think about each role you’ve held and list up a few things that you picked up on or developed at each place, regardless of the length of your tenure. Then, compare what you learned during your first year within a company, to what you learned the last year within the same company. Compare the educational value of  both your wins and your losses. Which had a greater impact on your professional path and personal development?

Building on this introspection, do you think your position towards potential talent may need to be reassessed?

The author is a Recruiting Manager at TeqHire. is a specialized recruiting service for the tech industry that operates in Iceland, Romania and Berlin.

Norðurskautið covers the Icelandic Startup and Tech scene. Follow us on Twitter or sign up for our mailing list to keep up to date. You can also join our Slack community –

Last four years in hindsight

In early 2008 I moved to Iceland after five years in Stockholm. In the next two years, I experienced, as many Icelanders, extreme changes in both the economy and mindset of people, both locally and non-locally. I will not dwell on that issue since so many have written and shared their thoughts on what could have gone better.

Since January 2010 I have worked for Arion bank, the second largest bank in Iceland. The first two years were in the Recovery department, pretty much restructuring of overleveraged balance sheets of Icelandic companies. It was a challenging task, but an experience I learnt a great deal from.

Einar Gunnar Guðmundsson

Einar Gunnar Guðmundsson

In late 2011 I switched course. I decided to continue to work for Arion bank but under very different circumstances, namely to build the bank’s work for and with the startup community in Iceland. And what a journey it has been. In the aftermath of the global financial meltdown, few years had to pass before most people and companies had either the energy or will to shift their efforts to something constructive rather than just coping with reality.

Today, Iceland has a thriving and vibrant startup community. Two business accelerators are in operation, the third one is planned in the first half of 2016, international conferences on Iceland are regularly held, three new VC funds (Eyrir sprotarBrunnur and Frumtak II) have started in addition to the state owned NSA.

The accelerators are: Startup Reykjavik, Startup Energy Reykjavik and Startup Tourism. I have had the pleasure of building the first two ones at Arion bank with other people, since the bank owns these two. More on the accelerators later.

Two supporting entities to the community are in operation: Firstly, the state operated Innovation Center Iceland (NMI) and the privately owned non-profit Klak Innovit.

Additionally, there are several co-working spaces operated by several parties. The Icelandic Ocean Cluster hosts dozens of companies in all maturity stages in addition to investors at the beautiful harbor side downtown Reykjavik. Can’t help to love their place. NMI operates a few co-working spaces: Center for the creative industries at Hlemmur square consists of Hellirinn (The cave), Gasstöðin (The gas station) and Tónlistarklasinn (The Music cluster). Other spaces are availble from NMI’s side in Reykjavik and in towns close to Reykjavik. KPMG Iceland has one floor for startups, mostly in software. Innovation House, founded by Opera’s founder Jon Tetzchner has great facilities and hosts 15-20 companies on a regular basis.

My point is that almost none of these initiatives were available five years ago. The same trend has happened in Iceland as elsewhere in the Western world, where startups and entrepreneurs have started to be noted, not only by media, but by investors and the general public. Not to mention clients that gain value by purchasing their products and services. Building a thriving startup community does not happen overnight. It takes relentless efforts of people in various positions in society to do so. But mostly by entrepreneurs. What has happened is the cliché “Build it and they will come”, and Iceland is witnessing that these days. And there will be more coming.

Einar Gunnar Guðmundsson is a corporate entrepreneur at Arion Bank. This post was originally posted on his blog.

Norðurskautið covers the Icelandic Startup and Tech scene. Follow us on Twitter or sign up for our mailing list to keep up to date. You can also join our Slack community –

Iceland: VR Valley?

In a popular blogpost from earlier this year the investor, tweeter and entrepreneur Marc Andreessen discussed a politician’s pipe-dream: what it would take to create the next Silicon Valley.

In essence his argument is simple: Don’t even try. Trying to mimic an organically grown, entrepreneurial community with governmental stimuli won’t work.

But policymakers shouldn’t be trying to copy Silicon Valley. Instead, they should be figuring out what domain is (or could be) specific to their region — and then removing the regulatory hurdles for that particular domain. Because we don’t want 50 Silicon Valleys; we want 50 different variations of Silicon Valley, all unique from each other and all focusing on different domains.

Why am I quoting this almost year-old blogpost?

Two weeks ago, two Icelandic tech companies, CCP and Sólfar, announced funding rounds, $30 million and €2 million respectively. In both cases, Icelandic investors participated in the funding rounds. In addition to this, Eyrir Sprotar announced an investment in Mure VR, makers of Breakroom VR, a little under a year ago (December 30, to be exact). This amounts to 3 VC investments in Icelandic VR efforts in under 12 months.

This, by my accounts, is a lot. Especially for a small fledgling ecosystem like Iceland’s.

Foundations for a cluster?

For an industry cluster to become possible, and more importantly, globally competitive, many factors are needed. It might be hard, but it is definitely possible. We’ve already seen the rise of the Icelandic Seafood Industry which is now one of the most competitive and best run seafood industries in the world. Maybe the next cluster is the VR cluster?

Even though the recent VR investments are focused on one industry (i.e. Virtual Reality), the companies and their products are fairly diverse. CCP is pure gaming, launching two games in 2016 – Eve Valkyrie and Eve Gunjack. Sólfar just announced Everest, which by accounts seems more of an experience, or attraction. Mure VR is developing Breakroom – a VR product for the workplace. This means that we have 3 funded VR companies that are experimenting with three different aspects of the VR platform.

Facebook's Mark Zuckerberg playing Eve: Gunjack on the Samsung Gear VR

Facebook’s Mark Zuckerberg playing Eve: Gunjack on the Samsung Gear VR

We might have the beginning of a VR industry in Iceland, where Iceland is one of the places where talent interested in VR goes to work. Where VR companies build offices and where VR innovation happens.

Icelandic regulators should pay close attention. If these companies start gaining traction, officials should make sure the environment here is great for starting VR businesses. They could encourage the adoption of VR technologies, and fund research by Universities and academia to further innovation in the sector. How exactly regulators should enable a VR industry is not mine to say, but to quote Andreessen, the government should do what they do best: “create, or rather, relax laws.”

Risky business

While I’m ecstatic that entrepreneurs and innovators in Iceland have been able to secure the confidence and cash of investors, we must remember that VR is a very untested market. Several days ago, EA Games, one of the gaming industry’s giants, announced that the company would not invest heavily in VR gaming for the next several years. The reason: they don’t believe the market is there or will be there for the next 5 years.

This, of course, could be the arrogance of the incumbent. Incumbent smartphone manufacturers didn’t believe people wanted touchscreens until the iPhone came, and then it was to late for the incumbents.

Analysts don’t agree either. Kzero, a consultancy group in the virtual space, estimated that the consumer VR market will be $5.2 bn in 2018. Another consultancy, Digi-Capital, estimates the joint AR (augmented reality) and VR market to hit $150 bn by 2020 (and the VR market in 2018 supposedly will be a little over $15 bn according to their graphs). The third group, Grand View Research, estimates VR gaming to hit $9.55 bn by 2022. In short, a lot of unknowns.

The prospects of Iceland becoming a hub for VR increased dramatically last week, but it’s still far from certain. To get there, we need to help the current companies succeed, enable new ones, and create an environment where this industry can prosper.

Norðurskautið covers the Icelandic Startup and Tech scene. Follow us on Twitter or sign up for our mailing list to keep up to date. You can also join our Slack community –

The most difficult tech recruitment in Reykjavik

Jökull Sólberg Auðunsson, co-founder Takumi

Jökull Sólberg Auðunsson, co-founder Takumi

Due to software eating the world the demand for coding talent has been increasing. Not only are the number of people seeking degrees in computer science increasing, but the pay is rising and the fight for top talent is fierce.

The universities in Iceland have done a great job developing talent and exposing people to real world problem solving, readying them for fruitful careers and entrepreneurship.

Another line of work that is crucial for startups and technology companies is interactive product design. There is no course or degree in Iceland focusing on this important and lucrative line of work. The closest is LHÍ with its graphics department. I’ve had numerous discussions with alumni and staff from the department asking them why students are only exposed to outdated mediums, no interactive work and no animation work. Their answers vary and feel defensive.

LHÍ graduates a lot of great talent every year but they are not prepared or encouraged to investigate mediums where the salaries are going. This is a disservice to the students but also to the ecosystem as a whole. We would all benefit greatly from more people seeking a career in interactive design and product management.

Framkvæmd trompar hugmynd – en hversu mikið?

Síðastliðna mánuði hef ég skoðað mikið af efni um sprotafyrirtæki, viðskiptahugmyndir og nýsköpun. Mikið af bókum, hlaðvörpum, myndböndum, og fleira um ýmis umræðuefni allt frá praktískum ráðum um hvernig eigi að framkvæma tiltekin verkefni (t.d. lagaleg atriði, markaðssetning, fjármögnun) yfir í abstrakt pælingar eða heimspekilega framtíðarsýn á tækni og nýsköpun.

Vignir Örn Guðmundsson

Vignir Örn Guðmundsson

Flestir frumkvöðlar hafa eflaust heyrt því fleygt fram að hugmyndir séu ódýrar og að hver sem er geti fengið viðskiptahugmynd. Þetta er gjarnan notað til að ýta undir mikilvægi þess að hugmynd sé einungis hugmynd, og það sé allt annar handleggur að framkvæma hana. En eru frábærar viðskiptahugmyndir auðfengnar? Hvað þarf til? Eru þeir frumkvöðlar sem standa að baki frábærum viðskiptahugmyndum heppnir að hafa fundið þær, eða liggur gríðarleg vinna þar að baki? Vinna um að skilja hvernig tæknin þróast á ýmsum sviðum, og samhliða mynda sér skilgreinda skoðun á framtíð hennar?

Það sem mér fannst áhugavert er hversu samræmd skilaboð þekktustu leiðtogar í tækniiðnaðinum hafa fyrir frumkvöðla. Má þar nefna Ben Horowitz, Peter Thiel, Elon Musk, Sam Altman, og fleiri (sjá tilvitnanir hér fyrir neðan). Á meðan þeir koma boðskap sínum á framfæri hver á sinn hátt, má færa rök fyrir því að boðskapurinn snúist að miklu leyti um sama hlutinn; Að hugsa sjálfstætt. Enn fremur, hvernig frábærar viðskiptahugmyndir eiga það til að fæðast hjá frumkvöðlum sem sannarlega hugsa sjálfstætt.

Ég er hjartanlega sammála því að framkvæmd viðskiptahugmyndar vegur þyngra en hugmyndin sjálf, en erum við að vanmeta vinnuna sem liggur að baki frábærum viðskiptahugmyndum?

Látið mig vita hvað ykkur finnst.


“Don’t listen to your friends. The more generalized case of that is: Think for yourself. It sounds both simple and trivial, but in reality it’s extremely difficult and profound. And here’s why. As human beings we want to be liked. It’s anthropological. If people didn’t like you in caveman days, they would just eat you. So you really have a natural built instinct to want to be liked, and the easiest way to do that is to tell people what they want to hear. You know what everybody wants to hear? What they already believe to be true. The last thing they want to hear is an original idea that contradicts their belief system. But those are the only things, things that you belief that everybody around you doesn’t believe, when you’re right, that create real value in the world. Everything else people already know and there is no value in creating it. So it’s so important to think for yourself.”

Ben Horowitz2015 Columbia University Commencement Address.

“It’s important to reason from first principles, rather than by analogy. The normal way that we conduct our lives is that we reason by analogy. We are doing this because it’s like something else that was done, or like what other people are doing. For example, slight iterations on a theme. It’s mentally easier to reason by analogy rather then first principles. First principles are kind of the physics way of looking at the world. What that means is, you boil things down to the most fundamental truths and say: ‘Ok, what are we sure is true, or as sure as possible is true’ and then reason up from there. That takes a lot more mental energy.”

Elon Musk on work ethics, principles, attitude, failure.

“We are always focused on very short time horizons. You have to figure out how you are going to go through the next month, next quarter, get some customers, etc. But it is always worth thinking ahead 5–10 years. Why will this be a valuable business in 5–10 years? How’s the competitive landscape going to develop, how’s technology going to develop, how’s the world going to develop. These are hard questions. But the great entrepreneurs I know always have a perspective on it, and might be wrong. So, you have a plan. A bad plan is always better than no plan. Have a plan. You can always change it. Don’t pretend that you have no clue about what is going to happen and everything in the future is random. If you say everything is random, that’s how you set yourself up for failure.”

Peter Thiel on thinking ahead 5–10 years.

“I myself used to believe ideas didn’t matter that much, but I’m very sure that’s wrong now… Long-term thinking is so rare anywhere, but especially in startups. There is a huge advantage if you do it. Remember that the idea will expand and become more ambitious as you go. You certainly don’t need to have everything figured out in your path to world domination, but you really want a nice kernel to start with. You want something that can develop in interesting ways.”

Sam Altman at the first class of “How to start a startup” at Stanford.

“Right now the new is you, but someday not too long from now, you will gradually become the old and be cleared away. Sorry to be so dramatic, but it is quite true. Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.”

Steve Jobs at 2005 Stanford Commencement Address.

The really, really breakthrough ideas often seem nuts the first time you see them. And it’s the fact that they seem nuts that can be a very positive signal because 1) that can explain why it already isn’t being done by an existing big company, because it’s just considered too strange. And 2) if it works, if the bit flips at some point and it goes from nuts to a good idea, those are the companies that can just explode and become gigantically huge. The PC seemed nuts, the internet seemed nuts, AirBnB seemed nuts, Uber seemed nuts, Bitcoin today seems nuts..”

Marc Andreessen on big breakthrough ideas and courageous entrepreneurs.


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Nortstack – Reporting and analysis of the Icelandic startup scene