Tag: startup iceland

The Memo: Comments from an Angel and thoughts about Startup Iceland

Another week, another Memo. First, a couple of announcements.

We have a new team member at Norðurskautið. Her name is Guðbjörg Rist, an engineer from Chalmers, and she will be leading our efforts into research and reporting. If you’re interested in reports or research about the Icelandic startup scene, send her a line and she can help you.

We’re starting a book club. A group of people from the Slack-group (bit.ly/slack-is) decided to form a book-club. We’ve created a Facebook group for it (here). Our first book is The Power of Habit by Charles Duhigg. We expect to meet and discuss it by the end of June. It will most likely at Watchbox’s office (they’ve volunteered to be the first hosts!). You can join the FB or Slack groups to participate.

Now, on to the Memo.

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Last week I wrote about the Innovation bill. I asked for some feedback on the angel-investment deductions, and got some good discussions out of it. The following is a summary of a discussion I had with an experienced angel investor in the community:

I think this is a good change but it doesn’t go as far as EIS or SEIS does in the UK. There are two main issues I see. First, the deductions don’t apply to companies. Individuals don’t have the same tax benefits as corporations when it comes to deferring profits. Smaller investors might do this as individuals, but I think many will do it through a holding company. That means the deductions won’t be applicable to some investments. The other thing is that the rules don’t allow the investor to have a board seat in the company she’s investing in. I understand that you shouldn’t get a tax deduction when investing in your or your family’s company. But the bill doesn’t allow the investor to be a board member two years before and three years after the funding round.

I hadn’t thought about the tax benefits. Understandable, because I’m not an angel investor. These concerns by the investor sound general, in a way that active angels would have the same concerns. It will effectively bar active angels that invest through holding companies, or groups of angels that use a special purpose vehicle to invest. Which makes me want to re-iterate a point I made in the last Memo:

One thing caught my interest. The economic affairs and trade committee didn’t receive commentary on this from known angel investors. Neither oral nor verbal – at least not according to official records.

Barring investors from joining the boards of companies is strange. Many startups that receive investment from angels might benefit more from the angels’ contributions to their business, than their cash.

Looking at these incentives, it paints a picture of tax breaks meant for, or used by, inexperienced, small-time investors. A low minimum limit (300K ISK / ~$2,300), sub-optimal options when utilising the deductions, and restrictions to taking board seats, makes me afraid that it won’t benefit active, professional investors. I’m not calling it dead or useless, but I don’t have high hopes for the effectiveness, based on how the changes are implemented.

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Startup Iceland was two weeks ago. The event is the biggest in the Icelandic Startup scene. Well produced, speakers from all over the world and much anticipated. I’ve attended twice — this year and last. Many I’ve talked to in the days after the event mentioned that they missed seeing prominent figures from the Icelandic startup scene. And when Startup Reykjavik announced their 2016 batch and “half of the room stood up. I started thinking, where are all the startup people?” one attendee noted.

My question is What happened? In 2015, the Icelandic scene had the biggest funding year ever, with more startups funded than before. Startups are getting more attention and interest is high (just like in many other places). Yet, it felt like there were fewer attendees than before. How come only a part of community showed up?

Did you go to Startup Iceland? Why / Why not? Why didn’t more people show up? Shoot me an email with your thoughts, I’ll keep things off-the-record or anonymous if you want.

Note: I’m going on vacation for a week, so there won’t be a Memo next Monday.

Startup Iceland Live Tweet

Below we bring you a curated feed of Startup Iceland live-tweets.

Brought to you with help from Tagplay.co


How to get the most out of Startup Iceland

On May 30th, the fifth annual Startup Iceland conference takes place in Harpa. This year’s roster of speakers includes entrepreneur and investor Ingrid Vanderveldt; Mark Solon and Jenny Fielding, both managing partners at TechStars; and Arvind Gupta, Investment Partner at SOS Ventures.

Bala Kamallakharan, founder of Startup Iceland

Bala Kamallakharan, founder of Startup Iceland

There are many conferences in the startup world these days, and attending too many takes focus and effort from entrepreneurs, that could be used building or selling a product. However, conferences can be a great place to expand your network and get some inspiration, but it is important to use your time wisely. That’s why Norðurskautið and the Startup Iceland team bring you a short and handy guide on how to get the most out of Startup Iceland.

Be open to inspiration

While building a company, everyone has their highs and lows. “It’s hard work, and everyone can do with some inspiration,” says Bala Kamallakharan, founder of Startup Iceland. Many of the speakers have gone through incredible journeys to get to where they are now, and hearing those stories can be a great motivator.

Connect with mentors

All speakers who participate in Startup Iceland also act as mentors the next day in a 20 minute one-on-one session with entrepreneurs. “We encourage founders to buy their tickets early because if we have a tie break on the slot for mentoring whoever bought the ticket early wins,” Bala tells us. The mentors all have experience and networks and can help you and your company. Some tips from Bala on how to prep for a one-on-one:

  • Do your homework on the pitch: Be able to clearly articulate your business in a quick and precise manner (you only have 20 minutes, remember).
  • Do your homework on the mentor: Read about the mentors to both help you pick which one you want to meet, and to understand how she may help. What are her areas of expertise? What kind of network does she have? Know as much as you can about the mentor.
  • Know what you want: Prepare questions and topics and know what you want to get out of the meet. Are you looking for an investor? Tell her that, and ask for feedback and guidance in that area. Need help promoting your product? Approach the mentor with questions on promotion

Connect with the community

Conferences bring people together, and Startup Iceland brings a big chunk of Iceland’s startup community to one place. Use it to get validation on what you’re building, sourcing possible customers or colleagues, or talking to potential investors. “Every startup that I have been part of got a break after participating in Startup Iceland,” Bala says. “No one knows what that is going to be but there is only one way to find out: Make it a habit to be there.”

Learn from others

A smart entrepreneur learns from her mistakes, a wise entrepreneur learns from others mistakes,” Bala says. A conference like Startup Iceland has speakers discussing strategy, operations, product and more. Make notes on what challenges you currently face, and try to spot if the speakers discuss them. That can also help when deciding what to discuss with a mentor.

More info on Startup Iceland on their website. Book tickets here.

Lifandi tíst frá Startup Iceland

Hér mun Norðurskautið tísta frá Startup Iceland.

Startup Iceland á morgun – Norðurskautið verður á staðnum

Á morgun fer fram fjórða Startup Iceland ráðstefnan. Meðal þeirra erlendu gesta sem koma á ráðstefnuna eru Brad Feld, fjárfestir og áhugamaður um uppbyggingu sprotaumhverfa, Om Malik, stofnandi GigaOm.com, Ingrid Vanderveldt, stofnandi Empowering a Billion Women by 2020, Keith Teare, meðstofnandi TechCrunch. Ýmis þekkt andlit úr íslensku sprota- og viðskiptalífi verða einnig á svæðinu, eins og Helga Waage frá Mobilitus / Promogogo og Hjálmar Gíslason frá Datamarket. Dagskrá ráðstefnunnar má sjá hér.

Þar að auki munu sprotafyrirtæki fá tækifæri til að pitcha sínum verkefnum og Sigurður Páll Hreinsson, forstjóri Deloitte, kynna verkefni sem Deloitte á Íslandi mun fara af stað með til að styðja við frumkvöðla og sprotastarf á Íslandi.

Norðurskautið mun vera á staðnum og segja frá helstu fréttum. Við munum bæði setja inn pistla á síðuna, sem og tísta nokkuð reglulega á @nordurskautid.

Nortstack – Reporting and analysis of the Icelandic startup scene