Innovation, Startups and Venture Capital in Iceland

An innovation and entrepreneurship think tank, and more policy actions to come

Last Thursday, Þórdís Kolbrún R. Gylfadóttir presented actions for the benefit of the innovation environment of Iceland at the Federation of Icelandic’s Industry’s (SI) Technology Summit (is. Tækni- og Hugverkaþing). These actions are a follow up of the government’s innovation policy.

Earlier this week, we covered two of the announcements: Kría, the new Icelandic Venture Initiative and the government’s plan to increase the maximum ownership allowance of pension funds in venture capital funds. 

However, the minister announced more actions. 

A think tank on Innovation and Entrepreneurship

Þórdís Kolbrún has recruited ten entrepreneurs and investors to participate in a think tank (is. hugveita) to discuss the matters of innovation and entrepreneurship in Iceland. 

“The tasks of the think tank are to give advice, suggestions, or raise concerns on matters that need to be solved, as well as giving feedback on both present and future projects and plans for the innovation sector,” the ministry states on their website.

Along with the minister of innovation and the minister of finance, these ten individuals are part of the think tank: 

  • Ari Helgason, investor at Index Ventures
  • Ágústa Guðmundsdóttir, co-founder and R&D manager at Zymetech
  • Guðbjörg Edda Eggertsdóttir, investor and board member of various organizations, and former CEO of Actavis
  • Guðbjörg Rist, CEO of Atmonia
  • Guðmundur Hafsteinsson, entrepreneur and former director at Google
  • Guðmundur Fertram Sigurjónsson, founder and CEO of Kerecis
  • Gunnar Hólmsteinn Guðmundsson, co-founder and COO of Teatime Games, former COO of QuizUp, and co-founder and CEO of Clara
  • Stefanía Bjarney Ólafsdóttir, co-founder and CEO of Avo
  • Tryggvi Þorgeirsson, co-founder and CEO of Sidekick Health
  • Þorbjörg Helga Vigfúsdóttir, founder and CEO of Kara Connect 

The first meeting of the think tank will be held in January 2020. 

Stock option and convertible bond taxation

The ministry of finance, in collaboration with tax authorities, is examining the possibility of changing tax law, making them more lenient for startups. These suggestions include changes to how stock options and convertible bonds are taxed to make things simpler, more competitive, and fair for these companies.

“These actions are meant to encourage investors to invest in startups and make it easier for innovative companies to attract employees, managers, and consultants,” the ministry said in a statement. 

Open Data and innovation in the public sector

At the event, Þórdís Kolbrún emphasized “the importance of innovation in all sectors … and to tackle the futures’ challenges, organizations and institutions need to be able to utilize new technology and new approaches.” Therefore, the minister of innovation has decided that part of the funding for the institutions that report to her will be earmarked for investment in innovative solutions.

In addition, Þórdís announced that the National Energy Authority (is. Orkustofnun) will be opening up their data for a hackathon this spring. The NEA has a vast database with data on their subject, ranging from energy usage to exploratory maps, which, when made open, might enable new services and opportunities.

The ministry of industry and innovation has made a document with more details on their plan available here (in Icelandic).

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