A group of Norwegian technology founders and innovators is determined to help Norway remain competitive in high-tech, produce new unicorns and become an international leader after the government plans to remove exit clauses on assets. I think it will be difficult to hire human resources.
On April 9th, the Norwegian Start-Up & Tech Association (NAST) launched an online petition to collect the opinions of founders and employees who could suffer significant losses from the introduction of this measure.
If the natural interest for a start-up company is to scale up and expand in foreign markets or to go abroad in search of a better deal, an offer for over $46.5 thousand of unrealized assets accumulated in Norway The current 37.8% exit tax is the last straw for foreigners or Norwegians with big dreams of setting up a business in the Nordic country.
“This policy is not intended to affect startups,” admits Andreas Myasset, CEO and founder of startup hub Mesh, but the measure does create a lot of uncertainty for startups. He explained.
Most tech founders are actually not entirely opposed to the new exit tax: “It’s not a bad thing at all, but it’s a bad thing in some areas,” says Norway’s first unicorn. says Johan Brand, founder of Kahoot! He added that many countries, such as the Netherlands and the United States, have introduced exit taxes, but “[the technology industry]is largely a byproduct of regulation aimed at wealthy people leaving the country.”
Join forces with other startup incubators such as StartupLab, which founded NAST, which aims to shape the political conversation around startups and technology.
Because CEOs and employees often receive shares as compensation for their work, they can end up paying huge bills the moment they leave Norway and move to their home country, for example.
“Starting this year, we will not be hiring any new foreign talent,” Pal T. Ness, head of Norwegian unicorn Gelato, said at a meeting hosted by NAST in downtown Oslo.
He added that Norwegians really don’t want to admit it. Neighboring countries were doing better in this regard, he argued: “They should go to Sweden.” A game enhanced by new rules that has already caused some people to emigrate from Norway due to what Brand calls a “starvation drain”.
Government intention, better exception
Earlier this year, Industry and Trade Minister Jan Christian Vestre said the government had the political will to improve the startup situation and ecosystem, and that “Norway, with its ambitions to be the world’s largest in its own business, I would like to see more unicorns and startups.” do’.
According to NAST, Norway’s political class does not fully understand the importance of the startup scene and therefore how to deal with the emerging technology sector.
Other European countries have strengthened option programs, encouraged risk investing, and created startup and scale-up visas.
However, this appears to be a “bad timing” issue. At the end of 2023, the Ministry will consult national stakeholders (the so-called Grunemer) to understand what policy changes Norway should implement to help entrepreneurs and start-ups: (Ding) for his opinion. Thrive. Feedback still needs to be read and processed, and a decision will not be made until the end of the year. Similarly, NAST was caught off guard by the exit tax as it had planned to begin lobbying in the coming months to form and build partnerships ahead of next year’s general elections.
Mjåset believes that today’s options don’t work for startups and wants to promote a paper addressed to politicians in favor of the tech startup scene. Later this month, NAST is drafting a 10-point document containing recommendations on “what the startup industry wants,” particularly for businesses with fewer than 50 employees and those with fewer than 50 employees. The focus is on expanding the benefit exemption for startups, which previously only applied to startups. Revenues are less than $7.5 million.
need funds
So far, only seven unicorns have come out of Norway, and most of them are software-based companies, with the exception of iPad competitor reMarkable.
“Seventy percent of venture capital money goes to London, Paris, Berlin, but the biggest results aren’t the ones that come from there,” said Matt Weigand, partner at venture capital firm Accel, based in Stockholm. He cited the example of Spotify, a music provider with “These stories tell us that companies can come from anywhere,” Weigand said.
Norway’s startup community is ready to celebrate the ‘next big thing’ in the sector, but fears exit tax rules could discourage investors and drive away founders .
Norwegian early-stage VC fund RunwayFBU, in collaboration with Accenture, published a report in March that sheds light on what startups can do to grow and scale. After analyzing 2000 Norwegian startups, this report highlights some key points that founders need to act on.
Most successful startups have a diverse set of investors, which determines twice the growth compared to startups that raise funding based on a single source.
Foreign investors, particularly seed-stage investors from the United States, are increasing the chances of Norwegian companies scaling rapidly. However, the new tax may cause those same investors to reconsider investing in Norway for fear of locking in their investments.
where to bet
According to the European Commission 80% Much of industrial data remains untapped, and for Weigand, the companies that can profitably figure out how to make the most of this information will be the “winners” in the coming years.
Many companies are poised to bet on data to build the next big thing in technology and pivot away from the country’s traditional industries of oil and gas, telecommunications and fishing.
But what worked in Norway was also to focus on existing sectors and find better solutions for stakeholders to access data.
A unicorn that has successfully leveraged data for growth is industrial technology company Cognite. Cognite helps oil and gas producers and other asset-intensive industries contextualize their data to make better predictions and easier decision-making.
With a number of oil companies, including Aker BP, it won’t be difficult for Cognite to expand rapidly. “Lack of productivity in industrial processes is a big problem,” said Karl Johnny Hersvik, CEO of Aker BP, adding that digitalization has helped. Increase efficiency and speed up processes.
But for Energy Impact Partners investor Silje Groning, Norway needs to invest beyond its existing industries to remain competitive, diversify profits and secure the future of the Norwegian economy. There is.
NAST will focus on much-needed climate change and health startups in Norway, which Brand believes Norway needs to “replace these oil and gas companies.” We are considering including it in our proposal.
I’m working on it
Oslo’s tech industry is in a bad mood, but that doesn’t mean nothing is being done to support it.
For Fredrik Mowir, CEO of PEM electrolyser company Hyster, his company has benefited from the government’s excellent financing mechanisms for developing green technologies. Mowill expects this trend to continue, and expects it to expand into research and development funding.
The department is currently working on comments received for a new bill expected to be proposed by the end of the year, and will soon have to consider a petition expected to be submitted by the tech community.
Meanwhile, the government is trying to streamline the rules for the trending circular second-hand goods resale market. The new law, which makes significant simplifications for resellers without forgetting to take into account the necessary security considerations, should come into force on July 1st this year. “We hope that we are one step closer to the elimination of VAT on used goods and new business opportunities.”Models will emerge (…) “, CEO of Oslo Business Region said Siu Andersen.
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