After oil, Norway looks to startups for economic growth

After oil, Norway looks to startups for economic growth

With oil prices plummeting, countries blessed with natural resources are feeling the heat and Norway is no exception.

Politicians responding to the oil troubles are heeding calls for a new way forward, centered around startups. And the efforts to foster a new approach are led by an ambitious ex-business exec, the Crown Prince of Norway and a handful of contrarian entrepreneurs.

Norway has seen the value of its state-owned oil and gas fields fall by more than $50 billion, or nearly a third, in the last two years, according to a report by Rystad Energy. Over 36,000 oil jobs have disappeared — not a small number for a population of 5.1 million.

Anita Krohn Traaseth, the CEO of Innovation Norway, the Norwegian government’s instrument for innovation and development, says that it’s time for Norway to look beyond oil.

“Norway needs to develop and build several growth sectors to contribute to a more diversified and sustainable national economy.”

Norway has produced some industry leaders, such as Aker Solutions and Kongsberg Gruppen, but most, if not all of them, are offshoots of the country’s energy sector.

Compared to its startup-breeding Nordic neighbours — Sweden (in a league of its own), Denmark, Finland, and even Iceland — Norway is faring poorly.

In 2015, the country’s share of investments was a meager 8.85% – or 30 investments – of the entire pie of 339 investments. The total amount of investments in 2015 was $1.82 billion, with Norway taking home $85.4 million, finishing dead last.. While Nordic countries top most lists that measure the attractiveness of different regions for startups, Norway is missing from most charts.

“One of the main challenges for the local startups is the lack of private capital towards for startup and growth companies,” said Karen Elisabeth Ohm Heskja, Chief Startup and Growth Officer at Nordic Edge Expo.

Perhaps a sign of its oil and gas worries coupled with a sense of urgency, the number of investments in Norwegian startups is up by 300% in 2016. In this year alone, Norway has seen 28 investments, two shy of the total number in 2015.

Innovation Norway

One of the central players driving Norway’s startup scene Innovation Norway, headed by Krohn Traaseth. The fund invests on behalf of the government and its ministries, with a total value of 25.3 billion NOK ($3 billion) and in 2015 distributed 6.1 billion NOK ($729.5 million) to Norwegian businesses of which 30 percent were startups.


Anita Krohn Traaseth speaking at Startup Extreme. Image by Dan Taylor.

“The fundamentals in Norway to make a successful transformation are solid. We still have low unemployment rate, we still have a huge capital reserve to make necessary investments for the future, we have a strong growth of entrepreneurial focus and companies. This is all about how we prioritize, reposition investments, build competence and have the guts to make important, and maybe radical political decisions today, to secure tomorrow.”

Although the pace of change is slow, the shift from oil to new industries is happening.

“In the last year we have seen new initiatives emerge that fuel alternative technology such as Nordic Edge (Smart City), Spaceport Norway (Space industry) Norwegian Smart Care Cluster (transfer of knowledge from oil and gas to health care) and others,” said Ohm Heskja.

High wages in the oil industry have also played a role in attitudes toward other industries.

“Many industries have been starved of expertise in technology-based careers, because they have been unable to compete with wage levels in the oil industry  That has changed, benefiting technology-dependent industries outside of oil and gas, as well as the public sector,” Ohm Heskja says.

Royal help

In addition to the government’s investment activities and new promising initiatives, the country’s most popular monarch, the Crown Prince Haakon has taken an active role in leading Norway’s transition by supporting the creation of a viable startup culture. Visiting Silicon Valley in 2013, Prince Haakon told TechCrunch about Norway “constantly trying to foster a culture of innovation.”

Prince Haakon has lent his name to support Norwegian startups by visiting local events. In mid-June he kicked off the second annual Startup Extreme event in Bergen, a city on the west coast of Norway.


Prince Haakon speaking at Startup Extreme. Image by Dan Taylor

Plenty of work ahead

Although the country’s government and royalty seem to have local startups’ back, problems remain.

“Regulations remain an issue. The cost of raising a new seed or venture fund as a first-time manager is simply too high for smaller funds. This means we’re are losing out on important competent capital,” said Rikke Eckhoff Høvding, the CEO of Norwegian Venture Capital & Private Equity Association (NVCA). “Secondly, in the earlier stages, we’re hoping the government will follow the lead of the UK and Australia and introduce tax incentives for investments in early-stage companies.”

The problems are exacerbated by an investment mentality that favors the old (gas and oil) at the expense of the new (emerging tech).

“The government is still to reluctant to take the necessary steps in the tax and regulatory systems to enable us create generations of successful entrepreneurs, employees of startups and Angel investors. We need more people exposed to starting, working for and investing in startups – and failing or succeeded at it,” said Johan Brand, cofounder and the CEO of Kahoot!, an educational gaming platform headquartered in Oslo. “This is the only way to create generations that are good at it. They (the government) are scared to take unpopular decisions now, that will benefit us long in the term. We currently lack people who are visionary on behalf of the nation.”

Brand is also deeply skeptical of the Norwegian government’s willingness to publicly support initiatives that are not oil related. With all the criticism, Brand believes that Norway can create successful companies outside of the energy sphere and in spite of the government.

“I believe there is a huge untapped potential in the Norwegian economy with the highly skilled industrial sectors serving the oil industry once applied to other consumer sectors,” said Brand.

Frode Jensen, another local entrepreneur, the founder of SociusLive and another skeptic would would like to see changes on a larger scale.

“Programs like Innovation Norway will not have a significant impact. But it’s a good start but we need bigger, systematic changes,” he said.

“It has been debated in Norway for decades that we should not grow dependent of the oil industry, yet we did. Of course it’s been a hugely important sector to enable our society to become as prosperous as it is today,” said Brand. “However, we still let ourselves grow dependent at the expense of investing and taking on the costs of building up other sectors.”

Oil – too much of a good thing?

When it comes to natural resource rich countries and oil-dependency, Norway is an anomaly. Compared to OPEC countries like Saudi Arabia, Iran and Iraq, Norway has a rich democratic tradition similar to its equality-obsessed neighbors in northern Europe. But even for a country like Norway, the overabundance of natural riches might hinder its development into a startup nation.

Although Norway continues to be a strong player in oil and gas, many Norwegians have embraced the most truthful cliche ever uttered: nothing lasts forever. The country will continue to dominate as an oil and gas nation in the short run, but this might not be enough to support a generous welfare system that offers fathers a paid four month leave from work.

Featured Image: iurii/Shutterstock
Source: TechCrunch

P2P mobile payment app Tapp raises $9 million to tap into the cash economy in Southeast Asia

P2P mobile payment app Tapp raises million to tap into the cash economy in Southeast Asia

Finland-based mobile payment app Tapp Commerce has raised $9 million to expand its operations in Southeast Asia for users without a bank account or credit card.

Mobile phones have emerged as the dominant alternative payment method to cash for buying and selling goods and services in emerging markets. And with a service akin to alternative payment providers like M-Pesa and Pagatech in Africa and a slew of alternative payment platforms in Southeast Asia, it’s a technology that the region understands well.

Headquartered in the Finnish city of Turku with product development in Helsinki and offices around Asia, Tapp’s Series A round was raised from Australia-based Amma Private Equity — an early stage investment network — and brings the total amount invested in the company to $12.9 million.

With the new funds, Tapp will strengthen operations in Indonesia and expand to new markets. The company currently employs a staff of 77.

“Tapp will use the funding to expand faster into Philippines, Thailand and Vietnam, with an eye to also open up Myanmar by the end of 2016. Funds will also be used in consumer acquisition efforts and continuing to build platform services which continue to reward for participation and create stickiness in our end user value chain,” said Warren Sample, the CEO of Tapp.

Tapp Commerce’s consumer app, Tapp Market, allows people without bank accounts or credit cards to upload cash  on the app to buy goods and services online via a network of sellers in emerging markets.

With Tapp, users can prepay for electricity, tuition fees, microinsurance, airtime and music. Anyone can become an agent – someone who can accept cash in exchange for digital currency –  with data and some cash.

Again, this is a market that’s already fairly crowded. Ayannah, backed by Golden Gate Ventures and other local venture capitalists; 1Pay in Vietnam; and 2C2P, all aim to provide payment services for the underbanked.


On the street level, Tapp wants to emulate existing — cash-based — consumer behavior in local markets. The company’s sales strategy is to onboard trusted local shop owners to give shoppers an option to convert their coins and bills – through the app – into digital currency in order to expand their buying options.

For businesses, Tapp’s main partners are merchants, such as insurance and electricity companies. Tapp has 134 merchant partners in Indonesia and the Philippines. In April the company partnered with Indonesia-based insurance company Jaya Proteksi, a member of ACE Group, to provide microinsurance customers in Indonesia

The app currently works only on Android and is used by more than 30.000 vendors with 3 million buyers in Southeast Asia, according to a press release.

The worldwide mobile payment volume in 2015 was $450 billion and is expected to surpass $1 trillion in 2019. According to McKinsey, 2.5 billion adults worldwide – of which 2.2 billion live in the developing world – do not have a bank account. Couple this with the fact that smartphone adoption is increasing at a rapid rate in the emerging markets.

With the mobile phone becoming a popular payment vehicle across the globe, countries like Indonesia and the Philippines are in dire need of independent payment solutions that do not require credit cards or bank accounts.

“P2P mobile payments and mobile wallets are a great way to enable digital financial inclusion in these developing countries,” said Smrithi Konanur, a Global Product Manager for Payments, Web and Mobile at HPE Data Security.

Most mobile payment alternatives to bank accounts and credit cards are SMS-based. Tapp is competing for the market share against local players such as Kudo and Cyrusku in Indonesia and LoadCentral in the Philippines.

Tapp’s most formidable competitor is Vietnam-based MoMo that recently landed a $28 million investment from Standard Chartered (SCB) and Goldman Sachs.


One of the reasons why Google, Apple and Samsung – popular in the West – will remain less attractive to users in parts of Asia or Africa is their need for a credit card and reliance on existing banking infrastructures. That’s why companies you’ve never heard of, except for Alipay in China and MPesa in Africa, have a fighting chance.

Platforms and apps that tap into the existing cash economy without involving banks or credit card companies can be expected to thrive.

“The basic issue in the developing world is that more people have a Facebook account than a bank account. Credit cards are actually irrelevant as only basic banking services are required. We learned that only 23 percent of people in the Philippines have a bank account. Most transactions today are carried out in cash,” said Ron Hose, the CEO of, a mobile wallet in the Philippines.

Although there’s plenty of hype around a cashless future, with Sweden taking the lead, some countries are bucking the trend. In Indonesia alone there are 250 million people, but only 7-8 percent have a credit card and the amount of credit cards will likely reduce due to the country’s recent decree requiring credit card providers to submit transaction details.

Featured Image: JNZL’s Public Domain Photos/Flickr UNDER A Public Domain LICENSE
Source: TechCrunch

Chinese tech giant Kuang-Chi harnesses Israeli tech to build smart cities in China

Chinese tech giant Kuang-Chi harnesses Israeli tech to build smart cities in China

Kuang-Chi, a Shenzhen-based technology conglomerate, recently launched a $300 million Israel fund in Tel Aviv to tap the country’s smart-city know-how, according to the company’s founder Ruopeng Liu.

“Kuang-Chi is the first Chinese corporate VC and incubator that leverages the capabilities of the Israeli market together with the distribution, sales and marketing and technology development in China,” said Dorian Barak, managing partner of Indigo Global, Kuang-Chi’s partner in Israel.

With a valuation of over $10 billion Kuang-Chi is no stranger to early-stage investments, with a portfolio that already includes Solar Ship Inc., Martin Aircraft Company (ASX:MJP), biometrics pioneer Zwipe and communications group HyalRoute

In Israel, the company’s Kuang-Chi GCI Fund & Incubator has already made its first investment: A $20 million commitment to eyesight Technologies, a machine vision company.

“Israeli entrepreneurs tend to have very big ideas, but there are limitations in the local market; we can help these companies to take big leaps,” said Liu.

Like many of his peers in China, Liu is looking to take Israeli tech to a global audience. And the first stop will be China.

The country’s smog-choked, populous metropolises are a perfect testing ground for Israeli technologies aimed at “smart cities,” which is a main area of focus for Liu’s fund.

With the rapid expansion of its urban population, Chinese cities suffer from environmental pollution and a shortage of resources, like potable water. Considering the difficulty of sustaining the country’s megacities, it makes sense for China to cozy up to Israel to adapt to the changing landscape. For example, Israeli water tech should be a shoo-in for China’s growing needs.

“With the future city, we emphasize two points: environment and safety. We know the severity of the problem in China and desperately need technology to monitor and track the real data of environmental change,” Liu says. “And the other part is safety, for example against natural disaster and disaster relief… 3.5% of Chinese GDP is lost because of disasters. Chinese cities are crowded and if something happens, many people will die.”

The launch of the fund is the fruit of nearly a year of negotiations with local Israeli players, and is potentially the first step of a multi-pronged approach to Kuang-Chi’s involvement in the technology scene.

The company’s new fund also is indicative of the flood of technology investments coming from China into Israel. Chinese investment into the country is growing by 50 percent annually and is expected to increase.

Despite China’s reputation as a copycat nation, the country’s economy is evolving as it gains more exposure to technology startups internationally while investing heavily in research and development efforts at home.

According to Liu, Kuang-Chi works with municipalities who have a keen interest to see their cities avoid natural disasters and overcrowding, operating with the support of the Chinese government.

And in terms of investment, the firm intends to be stage-agnostic. “We are not financial investors. We don’t care about the stage, we only care about what they are doing. It could be a one person company or a 100 person company,” said Liu.

Based on Liu’s vision, there are a number of Israeli companies that might fit the bill.

“We are looking at robotics, aviation and at anything that makes machines behave and understand human behavior, “ Liu says. Kuang-Chi is also on the lookout for virtual reality investment opportunities.

Featured Image: Steve Allen/Shutterstock
Source: TechCrunch

Payment startup Zooz raises $24 million as global fintech looks for standards

Payment startup Zooz raises million as global fintech looks for standards

As payment solutions proliferate and calls for standardization mount, Israel-based payment platform startup Zooz said it has closed a $24 million led by Target Global Ventures, to expand globally and bolster its products and services.

Zooz’s series C round more than doubles the total amount invested in the company to $40.5 million, raised in four rounds. The latest round included Fang Fund, iAngels, Kreos Capital and existing investors Blumberg Capital, lool ventures, Rhodium, Claltech (Access Industries’ Israeli tech vehicle), XSeed Capital, CampOne Ventures and angel investor Eilon Tirosh.

“We are opening  sales and tech support offices in Berlin and San Francisco. We are also you going to invest more in business intelligence that relate to payments and better optimization of data. We are also looking to go from 80 to 120 employees in a year’s time. Sales and tech support in both cities,” said Ronen Morecki, co-founder and CTO of Zooz.

Primarily targeting developers for both mobile and desktop, Zooz provides a payments platform designed to help merchants reduce the rate of international cards being rejected.

“We know to route to the right payment processor, increasing the chances of the card being accepted.”

Zooz wants to be in Germany for the country’s massive growth potential. The company is seeking new retailers and Europe’s largest economy is fertile ground for expansion.

According to ATKearny’s Global Retail Index, Germany is the second largest online market in Europe with almost triple the UK’s current growth potential.

The same report predicts that European online retail sales will reach 234€ billion by 2018 and almost half of all online retail sales across the EU will be from online purchases made using a smartphone or tablet by 2018.

“We believe that the German market is highly advanced in eCommerce and many other retailers in Europe are interested in the German market. So it makes sense for us to follow their lead, said Morecki.

Europe doing the right thing

While Zooz is not directly competing with banks, it is banking on the success of deregulation and the expansion of unified standards globally. In fact, the company’s expansion into Europe plays out against a backdrop of the EU’s planned revised Payment Services Directive (PD2), which is intended to open up the market to new players.

“PSD2 will fundamentally change the game for consumers, banks and third party providers by opening up the market in the same way that the app stores did for mobile phones. With PSD2, third party providers can develop new services on top of existing bank infrastructure that never would have been developed otherwise,” said Erik Engellau-Nilsson, Vice President at Klarna.

According to Uri Rivner from BioCatch, a provider of behavioral authentication, one of the points the directive addresses is electronic payment security in the EU, making online payments safer and more secure.

Payment service providers will be liable for any fraud related issue and will have to be accredited on a yearly basis. Securing the payment ecosystem means a relatively fast, friction-free and unified solution for all.

“The European Commission understands that new payment features are added – purchasing from a new mobile device, first-time customer, applying for a new account – features that up till recently were not addressed, and therefore the need for a regulation is crucial,” said Rivner.

Lack of standardization

One of the biggest hurdles in mainstream adoption and growth in mobile and digital payments is lack of standardization.

There are a multitude of competing platforms, networks, service providers, point of sale technologies, and retailer strategies, including Apple Pay, Samsung Pay, PayPal, Square, Softcard, Walmart Pay, Venmo, just to name a few. Ensuring that there are compliant, secure standards across the board and that solutions are compatible across different channels – online and in-store – will be critical to mass acceptance.

“All parties involved in the payment lifecycle, from retailers to service providers to regulatory bodies, must coordinate to develop consistent and compatible solutions that keep the customer’s needs – convenience and security – at the heart of the conversation,” said Leo Loomie, VP at Digital Risk, a data analytics and compliance solutions provider to large financial institutions.

Featured Image: Kritchanut/Shutterstock
Source: TechCrunch

New initiatives emerge to help refugees

New initiatives emerge to help refugees

Prompted by the ongoing refugee crisis affecting much of the western world, new initiatives have emerged to provide solutions to the many challenges facing the beleaguered masses. As Rahm Emanuel once famously said, “You never want a serious crisis to go to waste.”

In a sea of clueless government bureaucrats and fearful citizens, these new startups want to tap into the potential of the newcomers. Privately funded initiatives — relying on the spirit of innovation coupled with a sense of altruism — may one day become the norm in helping tackle challenges such as the current refugee crisis.

Refugees to entrepreneurs

Founded in the Autumn of 2015, Finland-based Startup Refugees identifies skilled workers and entrepreneurs from the thousands of refugees (who are mostly adult males). The founders, Riku Rantala and Tunna Milonoff, believe that the refugees have the potential to enrich and elevate the Finnish business scene.

“There are all kinds of refugees, but many have been entrepreneurs in their native countries. They might have thoughts, ideas, information and understanding of cultures that Finns might not have,” Milonoff said in an interview.

Startup Refugees functions as a combination between a startup incubator and a talent agency.

The purpose is to map out the refugees’ — currently living in refugee centers around the country — skills, professionalism and business experience. The top candidates will receive a funding allowance of 32.80 euros ($38) for the period of one month.

The idea is to have the refugees use the funds to elevate the accommodation and food conditions in the refugee centers.

To qualify as a recipient of the allowance, the candidate must have the right to work in Finland.

Rantala and Milonoff believe that Finland, one of the many European countries in the throes of economic malaise, can benefit from the refugees’ potential.

“Immigration is essentially the importing of brains. We want to harness the mental capital of refugees and combine it with the mad brilliance of Finnish entrepreneurship to lift Finland from economic misery,” Milonoff said.

Fintech for immigrants

Refugees who manage to obtain the right to work are faced with another problem: how to find a job and, more importantly, how to get paid. Because banks do not open accounts for refugees, finding an employer who’s willing to pay salaries in cash is nearly impossible.

MONI, a Helsinki-based company, launched a pilot partnership with the Finnish Immigration Service in December to provide refugees with prepaid MasterCards and customized mobile payment accounts so the refugees can receive salaries and government benefits.

“To remove obstacles we enabled a feature where the employer can pay the salary to a refugee’s MONI account. First salary payment tests were made in February this year and now there are several employers onboard,” said Antti Pennanen, founder of MONI.

According to Pennanen both the companies operating reception centers and the refugees are happy with the service.

“Today almost 4000 refugees, over 10% of all refugees in Finland, are receiving their benefits to MONI accounts.”

The next step for Pennanen is to turn refugees into entrepreneurs.

“Our big goal is to create a simple model for the refugees to employ themselves as micro-entrepreneurs, with their taxation automated using smart contracts. This would mean decreasing the administrative burden for the government — less cost in tax collection since it is automated, faster employment for the refugees and new taxpayers for Finland.”

Headhunting refugees

In the context of the refugee crisis, the term headhunter carries some unfortunate connotations.  Unlike the local vigilante in Bulgaria who is quite literally hunting migrants, new companies have emerged that focus on headhunting refugees in the more traditional sense.

Profit-seeking companies with tech-savvy entrepreneurs at their helm are the perfect executioners of solutions that enable the integration of refugees into their host societies.

A social enterprise that connects refugees with companies that look for specific skill sets, Zharity is another Helsinki-based company. Zharity’s stated goal is to help 1,000 immigrants, newcomers or asylum seekers find work within a year from its launch earlier in 2016.

Founded in November during the height of the crisis, Austria-based Refugees Work helps refugees find jobs by creating profiles on its platform. Founder Dominik Beron told TechCrunch the company has registered more than 130 employers so far, and has around 1,000 refugees signed up to create a jobs profile to seek work.

Navigating local complexities

In Canada, a new startup helps refugees navigate the country’s complicated healthcare system.

iamsick, a digital health platform, helps migrants with access to healthcare services; from information about walk-in-clinics that are open late to pharmacies and emergency rooms, the platform shows users their nearest healthcare option any time across the country.

Nouhaila Chelkhaoui joined the company after living in Turkey, where she witnessed the chaos first hand.

“We have identified many Arabic speaking healthcare professionals across Canada, plus Arabic is now one of five languages the platform itself has been translated into. We’ve also established a direct phone line for assistance in English, Arabic and French for two hours a week so refugees who don’t have access to the internet or aren’t tech savvy can still get the information they need,” Chelkhaoui told U of T News.

Foodie refugees

Deviating from the plethora of tech initiatives, some newcomers are harnessing their cooking skills to make a living.

Considering the demand for Middle Eastern cuisine, this might be a smart bet.

Manal Kahi, a Columbia University graduate, launched a food startup with her brother Wissam Kahi, a graduate of Columbia Business School, to provide locals with authentic hummus — made and delivered by local refugees. Eat Offbeat employs refugees from around the world to cook their own family recipes and deliver the meals to customers in New York City.

Seldom has the following been used as a marketing pitch, but authenticity sells.

“[We want you to] feel like you’re in downtown Baghdad, for instance, or that you’ve been invited to a chef’s own home,” said Manal Kahi.

Good government, great startups

New startups that have emerged as a result of the influx of refugees indicate a trend that is long overdue. Instead of reverting to the role of bystanders, the startup mentality, pervasive in cities across Europe and North America, is taking problem solving away from the public domain to the incentive-based domain of businesses.

Profit-seeking companies with tech-savvy entrepreneurs at their helm are the perfect executioners of solutions that enable the integration of refugees into their host societies.

Cities and governments would be wise to cooperate with entrepreneurs who are able and willing to help refugees without adding to the tax burden. However, because governments control the agenda on immigration, successful integration needs to be a tango for two.

“Without government participation and political will to solve problems in this scale, I think it is really difficult to achieve anything,” Pennanen said.

Featured Image: Mikael Damkier/Shutterstock
Source: TechCrunch

Sirin Labs blasts into the secure smartphone space with a $72 million seed round

Sirin Labs blasts into the secure smartphone space with a million seed round

 Sirin Labs, a new high-end smartphone manufacturer, has raised a $72 million seed round from Singulariteam founder Moshe Hogeg, Kazakh businessman Kenges Rakishev, and the Chinese social networking service Renren to launch a new, secure smartphone.

The phone will be revealed in May at Sirin Labs’ flagship store in London.

Against a backdrop of global concerns over digital security like Apple’s dustup with the FBI and Whatsapp’s encryption announcement; the new phone company (now almost three years in the making) aspires to combine both the safety of a military-grade device and the features of an everyday phone.

“We managed to combine military phone and the phone for everyday use… We said: let’s create the best phone we can. Let’s see if we can integrate the best from both worlds without limitations,” said Hogeg.

That combined functionality will cost a pretty penny, according to Hogeg.

“It won’t be the most expensive phone in the world. We are in the neighborhood of $10-15k per phone. Tesla is a good example for us. They started with high priced cars, but today their car prices are much lower.”

Considering the phone’s high price point, Fortune 500 executive seems to be a likelier customer profile than a 25 year-old tech lover.

Hogeg says he is looking to create a high-end product in a vertical where it’s sorely missing.

“As tech lovers, we said we wanted to bring the most sophisticated tech out there into the smartphone,” said Hogeg. “91% of Fortune 500 companies are under cyber attacks, but companies can’t use a military phone because they usually lack all the apps that consumers use.”

Moshe Hogeg. Photo courtesy of Holatelcel

Moshe Hogeg. Photo courtesy of Holatelcel

The secure phone space remains fairly wide-open since Blackberry left in 2013 and is now focusing on security-focused enterprise customers with .

Silent Circle’s Blackphone is currently trying to take the lead among consumers. The company’s phone is priced at only $799, which means a very different customer from Sirin’s targets.

However, in February last year, Silent Circle announced – as part of the $50 million round – its intention to grab BlackBerry’s market share and woo business users.

Finland-based Bittium revealed its Bittium Tough Mobile at the Mobile World Congress in February to compete head to head with the Blackphone and ARCHOS’ similarly priced GranitePhone.

With ARCHOS, Silent Circle and Bittium all battling for market share, Hogeg’s Sirin Labs is launching at a time when consumers, animated by mainly aesthetic concerns, are perhaps willing to pay more for security without compromising on usability — or giving up on the joy of time-wasting apps.

Most secure phone manufacturers are strictly in the enterprise space, and Sirin’s high price point will likely put the company in that category, unless Hogeg’s thesis of Tesla-like adoption for the company’s product comes to fruition.


Known for security expertise, Hogeg bets on Israelis to provide Sirin with the knowledge to dominate the secure phone market. Headquartered in Switzerland, most of Sirin’s day to day operations are managed from the company’s offices in Tel Aviv (R&D and operations) and in the Swedish city of Lund where they are assembled by Sigma Connectivity.

Hogeg believes that the combination of Swedish engineering and Israeli security expertise is a winning recipe.

“Tel Aviv is a high-tech epicentre built around internet security, anti-virus software and cyber-defence technologies, and Sweden is a nucleus for some of the best telecomms engineers, designers and computer scientists in the world,” the Yo app founder said.

Although Rakishev and RenRen have previously invested in Hogeg’s Singulariteam, Sirin is an entirely separate venture for both.

Rakishev, a serial investor and petrochemical mogul, and Hogeg have partnered in a number of projects, including Mobli and Genesis Angels, then chaired by the now jailed ex-prime minister of Israel, Ehud Olmert.

Sirin is the latest project between the two men and was born in 2013 when Rakishev’s phone was hacked. While the attack damaged Rakishev’s phone, it did even more to damage his faith in mobile technology.

“Rakishev called me to share the story about his hacked phone and asked why he was unable to find a mobile phone that would ensure privacy while meeting the needs of an international business person, and why the new technology he saw in tech shows and tech publications wasn’t available in consumer devices,” said Hogeg.

The company’s operational lead and CEO is Tal Cohen, a former McKinsey consultant. Other key people include Fredrik Oijer, former product director at Sony Ericsson and Karim Rashid, known for his sensual minimalism, is in charge of design.

Rashid, well known for designing luxury items, is not designing a luxury phone.

“Sirin is not about luxury, It is about advanced technology which in turn results in high-end products,” Hogeg said.

The company is looking to beat competition by focusing both on usability and security for the consumer space. Currently, most companies that offer full encryption are enterprise-focused.

“We have a holistic approach, which integrates hardware and software solutions to ensure the best security and encryption. The specifics will be revealed in our product launch event later this year,” Hogeg said.

Renren, one of the investors announced today, refused to comment on its role in Sirin, but considering the company’s preexisting relationship with Hogeg and the recent acceleration of Chinese interest in Israel, stranger things have happened. What’s more, with over 160 million users on its social platform and a strong focus on mobile, it’s hardly a surprise for the company to desire a stake in the secure smartphone market.

Source: TechCrunch

Fintech dominates Nordic startup investments

Fintech dominates Nordic startup investments

Fintech attracted the most investment for the first time in the Nordic region, more than any other vertical.  Between January 1, 2014 and end of March 2016, 51 fintech investments were made in companies in Sweden, Finland, Norway, Denmark and Iceland, totaling $390.17 million.

The Nordics are following a global trend which saw year-on-year investments in fintech companies increase by 106% in 2015 to $13.8 billion, according to a KPMG report.

While smaller in numbers, nearly one in 10 investments in the Nordics is now made in fintech.

Sweden gobbled up the lion’s share with 32 out of 51 fintech investments, according to data from The Nordic Web, a resource on venture capital for the Nordic startup scene.

“This is quite the achievement for a region that has long been associated with gaming, enterprise SaaS and health and wellness as the dominant verticals,” said Neil S W Murray, the founder of The Nordic Web.

According to Murray’s analysis of the data, majority of Nordic fintech investments are in the $1-3 million size range, “indicating that a high number of healthy-sized seed rounds are being raised, and showing that despite the increasing amount of investment, the ecosystem is still at a fairly early-stage and the Nordics potential to be a fintech hub is still in its infancy”.

Why is Nordic fintech on the rise?

“The Nordics lend itself particularly well to fintech for a few reasons. Stockholm has a strong financial history, mobile adoption is rife, and fintech lends itself well to mobile solutions, meaning Scandinavia is a good user market. What’s more, the success of Klarna and iZettle has meant more interest in fintech in the region,” Murray says.

Klarna, a Stockholm-based payments startup allows users to buy without the use of cards and iZettle – also based in Stockholm – a mobile payments company for small businesses, have led the rise of fintech in the Nordic region.

Klarna, valued at over $2.25 billion, has raised $291.33 million in 6 Rounds from 12 Investors and iZettle, $244.04 million in 9 rounds from 16 Investors.

Although Klarna and iZettle are the undisputed fintech jewels of the region, Stockholm-based companies received 18 percent of all investments in fintech companies across Europe in 2014, indicating a widely spread fintech know-how in the Swedish capital,  and a recent Europe-wide fintech study by showed that Sweden is the third largest fintech hub in Europe after UK and Germany.

Don’t ask for change

One of the less obvious reasons is the cash-averse attitude many Scandinavians exhibit.

“The Nordic consumers avoid cash. For example in Finland, you can manage without cash 100% of the time,” said Timo Ahopelto, founder of Helsinki-based Lifeline Ventures.

Swedish anti-cash mentality has made headlines around the world. In an article about Swedish cash-phobia, the New York Times featured Bjorn Ulvaeus, a former Abba member, embracing a cashless existence.

“We don’t want to be behind the times by taking cash while cash is dying out.”

According to a study cited in the same article, bills and coins represent 2 percent of Sweden’s economy, compared with 7.7% the US, and 10% in the eurozone. Swedes prefer apps and credit cards to bills or coins.

One of the popular payment solutions, Swish, a rival both to cash and credit, was launched by six different Swedish banks. The app allows users to transfer money in real-time between major banks with a click of a button. In October, the platform was integrated into Klarna’s checkout solution so that users can pay for all eCommerce purchases with Swish.

Transactions without a paper trail

Companies in the Nordics are behaving much like local consumers.

Driven by a mixture eco-friendly thinking and efficiency, 89% of large and 59% of small businesses in Finland use e-invoicing, compared to the global average of 8.4%, according to the accounting body ACCA.

“Nordic companies have highest adoption rates in e-invoicing, rooted in the electronic banking system,” Ahopelto affirmed.

According to Mattias Hansson, the co-founder and CEO of Helsinki-based online invoicing software, Zervant, Finland is at the forefront of paperless invoicing.

”Small businesses are often late adopters, which is also true when it comes to electronic invoicing. But we have still seen huge growth in this segment in the Finnish market. In fact our figures show that in the last three years the number of small businesses using electronic invoicing has more than doubled each year.” 

2016: Nordic fintech abound 

The Q1 of 2016 has already witnessed 15 fintech investments, indicating a strong year for Nordic fintech.

“I think 2015 was the year fintech established itself in the Nordics, but 2016 will be the year that it leaves all other verticals behind,” said Murray.

Featured Image: StMayQ/Shutterstock
Source: TechCrunch