Icelandic software company Men&Mice has been acquired by private equity fund SÍA III, which is managed by Stefnir. The acquisition price remains undisclosed. New Business Venture Fund and other investors are the sellers. The company was founded in 1990 by Petur Petursson and Jon Georg Adalsteinsson. The New Business Venture Fund invested in the company in 2001 and other investors later.

“There are exciting times ahead for Men&Mice. The company’s environment is continually changing, and the company is facing new opportunities in times of rapid technological change,” CEO of Men&Mice Magnus Edvald Bjornsson commented in a statement. He took on that role in 2016 after technology stints in the US including EMC and Oracle.

Men&Mice develops and sells software solutions for DDI network infrastructure management of large international companies. The company’s clients include Microsoft, Intel, FedEx, Nestlé and Harvard Business School. Men&Mice employs 35 people in Iceland, the United States and Europe. Magnus Edvald Bjornsson is the CEO of Men&Mice, who joined the company in 2016 after a long career at Oracle.

Arnar Ragnarsson, Director of Alternative Investments at Stefnir commented: “We have great faith in Men&Mice’s operation. The New Business Venture Fund and other shareholders, together with the company’s employees, have built up a company that has developed good products, has a strong customer base and great growth potential. We look forward to further strengthening the company and its operations and going forward to the strong foundation on which it is based.”

Huld Magnúsdóttir, Managing Director of The New Business Venture Fund added: “Men&Mice has, in recent years built up powerful international operations and is an excellent example of how Icelandic ingenuity is used for software solutions around the world. It has been a pleasure to take part in the growth of the company in recent years. The Fund proudly delivers the company to new owners, and we wish them all the best in further development and growth.”

Today, Þórdís Kolbrún Reykfjörð Gylfadóttir, the minister for tourism, industry, and innovation, formally opened Work in Iceland, a “one-stop shop to provide comprehensive information about the job market in Iceland, to help foreign experts move to Iceland for work.”

Work in Iceland is a collaborative project between Promote Iceland, Federation of Icelandic Industry, and the Ministry of Industry on Innovation, with the goal of connecting the Icelandic job market better to a global audience of job seekers.

“It’s incredibly important for our industry to attract specialists to Iceland. That means we need to share all the good things about living and working in Iceland, which Work in Iceland will help us to do,” the minister said in a statement.

The website was opened formally at Alvotech’s headquarters today. More info on Promote Iceland’s website.

In today’s multi-media content driven world, kids of all ages are exposed to sound all the time, more often than not viewing or listening with headphones. This led to a considerable amount of kids developing hearing issues due to the high volume possible through the headphones

This, in part, is what drove Pétur Ólafsson to found BuddyPhones, headphones designed specifically for children and teenagers. Their company recently raised a $1m convertible bond from Icelandic investors.

(My questions in bold, Pétur’s answers in italic) 

Based on the numbers from the press announcement ($4.3m revenue in 2018), BuddyPhones is probably the most successful Icelandic consumer electronic company. You just raised $1m; what was the main purpose of the fundraise?

BuddyPhones is growing globally, we’re already in over 60 different countries and have more in our sights, so we needed more working capital to drive the machine. Building an innovative global brand is in many ways capital intensive, so this round will support us in taking us to the next level of operation. 

You’re based in Hong Kong – is the operation completely there, or is anything in Iceland?

Most of our core operation is done in the China Greater Bay Area of Shenzhen, Dongguan and all the way towards Guangzhou. Our main headquarters is at our office in Hong Kong. On top of that, we have small sales operations in the Netherlands and California, and an engineering team in Japan. You can say we very much operate globally.

We have used designers and photographers in Iceland, we have a lot of talented people in Iceland and I would love to do more things back home. The dream was always to set up a brand and design office in Iceland, but we will need to wait because basing operations out of Iceland is just too expensive. 

Did you try working on this project from Iceland? What was the main factor for you deciding to set up shop in Hong Kong? Do you think you would be able to run it from Iceland? Why/Why Not?

I strongly believe that we needed to either be close to our manufacturing hub in China or our key market in the US. It would be difficult to be somewhere too distant like Iceland, especially in the beginning of building the operation and brand. There are companies that have bridged the gap to operate in Iceland, but for a small growing company like us, I chose to spend energy on being efficient in what we are capable of at this stage. Hong Kong is very well-located in terms of access to the electronic manufacturing base in China- I can be on the factory floor in the morning and then be in sales meeting in Hong Kong in the afternoon. Hong Kong is a major hub in international trade and shipping and we get a lot of international buyers coming through for big electronics shows. Overall, it is the best place for us to be based.

What has been the most challenging thing about building the company?

This is a big question, a lot of challenges have come up through the years. I think finding good people to join the brand journey is key. As founders, we can be visionaries, but we need motivated and talented people with us- from logistics all the way up to the board and investors. If you find this type of support, your chances to survive the start up phase is considerably higher.

What advice would you give to Icelandic entrepreneurs that want to build up a consumer electronics company?

This links with the previous question, I think another key ingredient that you need to build up a successful company is to be doggedly persistent over a long period of time. It’s true what people say, running a startup is a long-distance ultra-marathon, not a sprint. To be honest, I have not seen much glamour from being a startup, just hard work. Of course, it’s rewarding to see your dreams come true but it is first and foremost hard work. You also need to know and believe in the value you are bringing to your users. Steve Jobs famously said that people don’t know what they want; fundamentally he knew he just needed to add value to the end user as the ultimate goal of the project. Technology for technology’s sake is only worth a fraction compared to technology that adds true value to users.

Featured image is of Petur H. Olafsson and co-founders Bjarki Vidar Gardarsson, Yvonne Lo, Petur H Olafsson.

This post originated in the Northstack Memo – our regular newsletter about the Icelandic startup, tech and venture scene. You can subscribe below.

Sign up for The Northstack Memo, our newsletter covering the Icelandic startup, innovation and venture capital environment.

Email address:

Leave this field empty if you’re human:

Icelandic food startup Lava Cheese, recently closed a €700k seed round using fundraising platform Funderbeam. The company, which is part of a growing scene of local, artisanal, specialty food producers, originally set aims for a round of €350-650K but had to cut fundraising short as they sailed passed their stretchgoal.

Lava Cheese is only the second Icelandic company to use this funding source (the other is FlowVR).

“There were a few reasons we chose to go with Funderbeam for our funding,” Guðmundur Páll Líndal, co-founder, told Northstack. “The local VC funds are mostly focused on tech startups, and we were raising in the middle of union-strikes and pay rises, which had the local food players spooked and fighting to conserve their resources.”

The funds will be used to scale up production in new markets, like Sweden, where Lava Cheese has already opened a production facility.

Northstack interviewed founder Guðmundur Páll Líndal for the Northstack Memo, sign up below to get it right into your inbox!

Email address:

Leave this field empty if you’re human:

Frumtak Ventures currently has two funds, Frumtak and Frumtak II. They were one of the three funds announced in early 2015. They were very active for two to three years, with their last fresh investment in 2017.

This post is from The Memo, a newsletter from Northstack analysing the startup and venture scene in Iceland. You can sign up here.

Questions in bold, answers unformatted.

You’ve been a part of Frumtak for a long time, with Eggert. What is the reason for this change of roles?
Eggert and I founded Frumtak Ventures as equal partners, but decided for the continuity from the first fund into the second fund that he would continue to be Managing Director and that I would take over at a fitting time.  That time has now come. 

Why at this point in time?
We formally announced on May 9^th that we will be raising a new fund, Frumtak III in 2020 which will operate up until 2030.  Potential investors want to know who will be leading the fund the whole time.  As Eggert had indicated that he wants the option to retire in 2025 we decided that now would be a good time to make the change we had originally decided, and that I will lead the new fund.

Frumtak II hasn’t done fresh investments since 2017 (Sidekick Health). Will your first undertaking be to raise a third fund?
The experience from the first fund was clear in terms of the number of companies and amounts to invest in that were sensible and as there was ample supply of investment opportunities when Frumtak II was founded, it took only 2 years to select the investments that we deemed appropriate for the size of the fund.   We also left enough in the fund to be able to support our companies going forwards.  I am deeply involved with both funds and will simultaneously head the fundraising for Frumtak III.

How do you think the current landscape for raising a venture fund in Iceland is?
I think the landscape is good for raising a venture fund in Iceland as the LP’s that have invested in venture funds in the startup asset class realize the importance of creating and building new companies and they understand that it takes time to create value and deliver financial returns.

I believe that the work we have been doing for the last 10 years is an important part of growing the venture industry and ecosystem in Iceland and it is important to preserve the experience and knowledge that we have built. It is important to grow that further by having a new fund which gives us the means to grow our team and continue to build a strong venture partner.
 
What could be better? What has changed since last time you raised a fund?
What our industry needs is more success stories. If we had more good/ great exits, it would be easier to raise a fund.  

When we raised Frumtak II, we were in the forefront of setting the traditional venture terms and activity of the funds with the LP’s in Iceland. The co-operation with our LP’s has been very good and they have shown us lot of trust.

Back in 2015 it was big news when three venture funds were announced in the same month. There has not been much fund activity lately beside new investment of Crowberry Capital and hopefully we can participate in new investments with our third fund next year.

General knowledge, paperwork and terms have become much clearer since 2015 which we hope will make our task easier when it comes to raising a new fund.

Subscribe to the Memo to get stories like this straight to your mailbox:

Last week, dating app The One was released for iOS and Android, with the goal of changing how online dating works.

“Dating apps have become a way to nourish your confidence – that someone likes how you look,” comments CEO and co-founder Davíð Símonarson. “It’s the exception, not the norm, that people actually strike up a conversation in these apps.”

That is one of the main things The One is meant to solve.

“In The One you get one match per day that is chosen for you. The only information you get about your match is a picture, their first name, and their distance from you,” Davíð explains. “You then have less than 24 hours to chat with your match, and once the time is up, both have to choose whether to continue the chat or not.”

The One Company, which develops the app, is founded by Davíð Símonarson and Ásgeir Vísir. They previously co-founded and worked on startup projects like Blendin and Watchbox. The company raised a $120k angel round (15m ISK) earlier this year from angels Investa, Tennin, and Miðeind.

“If the matched people decide not to continue the conversation, the match is gone forever,” co-founder Ásgeir Vísir tells Northstack. “But if they decide to extend the chat, we offer more options to converse like images and GIFs, and are working on more ways for people to express themselves in conversation.”

Subscribe to the Memo to receive regular updates and commentary on the startup, tech and VC scene in Iceland.