Interview with Vesa Riihimäki, Head of Startup & Growth Finland, Nordea
– by Laura Quinton, 02.01.18
“Have your business case described clearly, network with partners who have local competence and network with colleague entrepreneurs who have Indian experience”.
Vesa Riihimäki is Head of Startup & Growth Finland Unit at Nordea (Nordea Bank AB, commonly referred to as Nordea, is a Nordic financial services group operating in Northern Europe). The Unit takes care of customer relationships in the start-up and growth customer market. It also cooperates closely with VC funds, business angels and accelerators. Vesa attended GOInternational Finland’s Launch event for the Indo-Fin Market Entry Acceleration Programme and joined GOI’s Smart City Bizhack India hackathon at Slush17, as a revered panellist on the VIP Roundtable day.
Nordea is keen to connect their Finnish startups with Indian partners to facilitate internalization opportunities for their clientele. We had a brief conversation about Vesa’s unit and why the Indian Market is attractive to Nordea. If you’re seeking funding to expand your Nordic business and to enter the Indian Market, he’s your guy!
Nordea’s Startup & Growth Customer Unit is the first of its kind in Finland. Is this a sign that the way we do business is changing? What specific needs were you addressing with the set-up of this service?
Yes, this is a sign of how our customers are changing and how Nordea is changing the way it does business. Startup & Growth companies are important for our economy since they create new jobs and value. Scalable business models need a deep relationship banking model in order to succeed. We have been able to finance and mentor these companies on a large-scale – before the existence of Nordea’s Startup & Growth Customer Unit, this was not really possible.
The Unit is now one year old. Am I right that you’ve greenlit over €100m worth of loans to Finnish startups and growth companies in the last year? How do you feel that the last 12months have gone and what kind of impact has Nordea’s services had on Finnish Startups and SMEs?
When we talk about EIF (European Investment Fund) guaranteed loans, yes we have delivered over €100million of those in 2017. Overall, our loan portfolio is €250million and we have 1300 startups & growth companies with loan solutions – so yes we are helping and supporting the ecosystem in a really big way. A typical early stage startup loan amounts to €100,000, whereas a typical growth/scale-up loan solution is in the €2–10 million range.
The unit utilizes more human resources per customer, in order to focus deeply on the individual needs of each company. Have you facilitated the internationalization of any clients?
Over 95% of our customers have international business models and targets so, yeah, we actually do have daily discussions and mentoring sessions on how to overcome the growth and internationalization challenges currently at hand. Through close collaboration and mentoring, Nordea is helping startups and growth companies to grow and create important networking contacts with relevant service providers, equity investors, business angels, accelerators and startup hubs around the world.
Providing sufficient capital to finance growth throughout a fledgling business’ life cycle is most successful, you’ve said, when combining a financial package, with a decline in holding, taking in to consideration the price of money and in calculating the increase in the company’s value. How is the valuation & risk assessment calculated when taking a hot disruptive Finnish Company abroad for the first time?
A typical scalable business case is such that you can pour in almost limitless amount of money so that the return is higher than the costs – we have seen many of those. Typically human resources etc are the most severe bottlenecks hindering growth.
From your perspective as Head of Startup & Growth Customer Unit in Nordea Finland, what opportunities/challenges do you foresee in the emerging Indian Markets for Finnish Startups and SMEs? Are you looking to collaborate with investors from the Indian side?
First of all the (Indian) markets are huge so the opportunity is there. Also the startup & investor ecosystem is rapidly developing there, so that is a strong positive sign as well. Nordea is definitely happy to help Indian investors to find interesting target companies (from the Nordics) expanding into the Indian market and we also are keen to connect our startups with relevant (Indian) partners that can help them to enter the Indian market effectively, like GOInternational Finland.
Would you share some smart tips for any Finnish Startups or SMEs who are entertaining the idea of entering the emerging Indian Markets and seeking funding to do so?
Have your business case described clearly, network with partners who have local competence, network with colleague entrepreneurs who have Indian experience.
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