Recap on the startup events at MindTrek 11:57 on Friday

Sunrise through dirty train window

Watching the startup pitches during Thursday was probably the most interesting program of MindTrek. What made it interesting was not so much about the startups, but the way the jury drilled into the pitches and how they forced the founders to answer tough questions. I’m not going into whether the questions were always the right ones, but nevertheless, it was highly interesting. There’s more discussion about the pitches in Jaiku and more info about the jury in Arctic Startup blog.

Reflecting on those sessions and the admittedly unprepared pitches, I realized that:

  • Not one of the startups demonstrated Mostly the startups did not have a highly viable business model
  • All of the startups were “web 2.0″ startups: about community building, online services, technology platforms, etc.
  • Young, hungry teams, and like Setok said in the Jaiku discussion, people who still think it’s easy [to set up a startup] so they’ll go for it and only later realise the deep hole they got themselves into :-). People who are passionate not only about what they’re doing, but about being a part of a startup, and spending their free time perfecting The Pitch.

I thought why the startups I know personally were not participating in this pitching competition, or have not been participating at any Arctic Startup events, and I realized that:

  • They all have viable business models not rooted in advertising, or tiny commissions on millions of transactions, but actual sales
  • They are not about web 2.0, even if they are creating online tools or using/creating high end technology
  • They comprise of seasoned people in their thirties, with years of experience working in their field of expertise, with families to support and mortgages to pay. People who believe strongly in what they’re doing, but at the same time are very aware of the risk they’re taking. They worry about things like salaries and profit, value the few hours a week they can put aside and not think about work, and they think of the startup experience more in terms of it being something that will be a valuable experience in the future, after they have seen how it went down.

As far as I know, Arctic Startup is the one and only active arena for startups to shine in Finland, and they deserve the utmost respect for what they do. I wonder if there is something that they could do to attract a bigger variety of startups to participate, to avoid the “Arctic Startup circle” becoming merely a circle of fresh graduates who have a blast hanging together in bars. To bring in less “web 2.0 minded” people, and maybe more traditional business people who have started new companies (a “startup” is in plain language a “new company” after all, isn’t it?). I’m confident this would be beneficial both ways — the hungry young people could learn from those who have been through trials and errors, and the web 2.0 crowd could ignite the thinking of the more traditional people. This is something for Arctic Startup guys to think about.

11 Responses to “Recap on the startup events at MindTrek”

    Links from my other posts:

  1. Shift’08 recap — /personal

  3. Mark Sorsa-Leslie Says:

    I just want to highlight that HammerKit is a business that generates revenue today and has great growth potential for the future. We are at the beginning of a journey, and each of these opportunities provides a chance for the team and myself to craft our message, our demos and, ultimately, our future.

    If the presentations were poor, they can be improved. If the business models are flawed, they can be changed. If the technology stinks, it can be redone. However, if the community around startups pours scorn on those that try, then it damages the potential for new, great ideas to develop and discourages those that might try.

    Personally I enjoyed the event yesterday – it was billed as pitching to investors – but in truth it was not. It was about pitching to pitching experts…and that is why every team was going to be starting on the back foot. I learned a lot from the face-to-face with Sharon Ballard and March Davies and I know now what I will do the next time I pitch…

  4. Niko Says:

    Mark, I stand corrected on the case of HammerKit.

    I agree on the need to have a supportive community. On the other hand I also think it is not beneficial for the startups to have a community of people simply patting each other on their backs, generating a false sense of accomplishment. Once more I echo what Setok said on Jaiku:

    You need to be hammered to eventually become world-beaters!

    I realize I might give out more than my fair share of hammering, and not enough back patting to balance it out. But that’s more a problem for me than the startups. ;)

  5. Mark Sorsa-Leslie Says:

    No worries…its all about tough love…cruel to be kind and all that…;)

  6. Ville Vesterinen Says:

    Thanks for the recap Niko. As an editor of a blog reviewing those startups I think about the balance of batting on the back & encouraging the people hard at work VS. telling the truth (even if it hurts or in the most extreme cases demoralizes and destroys a startup) every single day.

    On one hand, I need to realize what it does to those young guns who are giving their best shots however bad those shots might be and will my analysis contribute to the entrepreneurship in the Nordics and beyond.

    On the other hand, if ArcticStartup has an opportunity to tell the world about the scene in this part of the world and give visibility to Nordic and Baltic startups, especially to the ones that deserve and need it, we better make sure we don’t pass that opportunity. We will very quickly become uninteresting if we are not credible and add real value to our readers. Clearly these readers want to know whether a service or a product is really worth their time let alone their money.

    That said, I recognize that we can not have the level of startups that Silicon Valley have and be as harsh as the media that reviews them.

    It’s a delicate balance and we at ArcticStartup do daily our absolute best to make justice to everyone.

  7. Niko Says:

    Ville, you’ve said that you want to be the TechCrunch of the Nordic area. TechCrunch is solely focused on web startups, is that also the focus of ArcticStartup? I saw you interviewed FutureMark, which is not a young company and I would not consider them a web company per se.

  8. Antti Vilpponen Says:

    Thanks Niko for some very good points on the startup scene. I agree with you in many ways, but I also must state that when I founded the concept one year ago we set out to profile “startups”. That was our focus. Then we defined it to match web and mobile startups.

    This was our strategy to build a strong enough reputation in this market (from ArcticStartup’s point of view), due to a few factors. First of all, we Finns have a very strong representation in the software business through different organisations, but the newer web industry has been very much under represented (not counting online gaming – which has a fairly good backing). Secondly, we also need to focus, strategically, in a very specific industry to really win that crowd’s respect and support. Only after that can we expand our focus.

    The reason behind this is, people in different industries want similarly minded people to talk with – only then can you enable good and mutually beneficial networking when people have a lot of common ground to share. Also, we see this as a way to bring in a larger crowd and share the experiences on a Nordic and Baltic scale, just as Ville stated above. I don’t think we, be it Finns, Swedes or even Estonians, can learn too much from simply looking inwards domestically. We really need to reach across borders and share best practices on a larger scale – only then can we have a shot at creating some synergies that could compete with other startup areas geographically.

    Long rant, but hopefully it’ll make some sense. :)

  9. Niko Says:

    Antti, this is a good clarification.

    Furthermore I would like to clarify if “web startups” means companies that have a product (eg. web service) on the web for everyone to see, and aim to sell their product through the web?

    Another common trait of the startups I know is that while they all have services running in a web browser, none of them are openly providing a web service to customers. By “openly providing a service” I mean that a potential customer cannot go to their web site and access the service, or even see that they have a web service. In other words, these startups are not selling their product on the web. Instead, these companies get customers by “traditional”, non-virtual sales, then provide the acquired customers with services that are accessed on the web.

  10. Kristoffer Lawson Says:

    Niko, I think it is fair to allow Arctic Startup their focus. TechCrunch actually covers some gaming and even device companies as well. FutureMark easily fits into that kind of domain, however strictly traditional non-media B2B logistics or business solutions probably do not, unless they’re trying something innovative in the online sense. I do think it’s important to have this increased visibility for web and mobile consumer services. Traditionally they have received next to nothing in the way of visibility, at least in Finland.

    There are very few, if any, investors investing into that area. Media like Kauppalehti are sure to ignore them. Even Tietoviikko told us they’re only interested in us if we make a big sale (which frankly seemed a bit short-sighted as that’s essentially missing this emerging IT phenomenon, but that’s their choice).

    Despite all the new networking possibilities, which honestly would not even be here with people like those in Arctic Startup, these startups are going to have the hardest time of all.

    But if there are more traditional companies that want to appear in the blogs, why not just contact them? I’m sure the AS team would be more than happy to look at them.

  11. Niko Says:

    I want to make it clear once more that I admire Arctic Startup for what they do, and whatever they choose to focus on, that’s excellent. I just wanted to clarify the focus for myself. Maybe I’m not listening closely enough. :)

    I don’t quite know if the more traditional companies are interested in appearing in the blogs — I’m not sure if they even know of the blogs. But like I said in the post, I believe it could benefit both the more “traditional” people and the web 2.0 people to mingle together. I guess I’ll have to invite my friends to the next ArcticEvening.

  12. Kristoffer Lawson Says:

    Invite them over. And sure, meeting old farts is always great too! Hm, especially when I’m quickly becoming one myself…