Overcoming the Finnish crisis

By Guest Author | Technopolis | October 19, 2015

This is a repost of the original article by Keith Silverang, CEO of Tecnopolis, published in the November 2014 issue of CoFounder, where he is sharing his view on the Finnish crisis.

No, It’s NOT OK – But It Will Be

“Everything will be okay in the end. If it’s not okay, it’s not the end.” – John Lennon

I guess it’s not the end yet because everything is not okay. Traditional industry has left town. Nokia phones are so over. What we’ve got left are lots of service companies, a bunch of startups and plenty of civil servants. The shit has hit the Finn as it were. But no worries. As John Paul Jones once said, we have not yet begun to fight.

In the end, Finland will come out of this mess stronger and more diversified than ever. But some people (and countries) only learn the hard way and, well, that’s us.

Let’s start with the facts from Finland (Statistics by TEM).

  • Finland has a low number of growth companies (750 out of which only 400 are real growth companies)
  • They employ less than 90 000 people
  • Only 14% out of the growth companies try to go international
  • 70% of the companies are not scalable
  • The majority of companies are small in size

So what we’ve got here is a whopper of a problem – everybody, including yours truly, is expecting growth companies to save our asses, but only a handful of them have Born Global ambition and real potential. Oops.

Yeah, yeah, I know. There’s the Supercells and Rovios. Kudos to them but we’re gonna need exponentially more of them to get ourselves out of this – which we will – eventually. I’m afraid the ugly truth may be that our most successful growth companies have made it not because of the System, but in spite of it. Imagine what we could achieve then if the system got the hell out of the way.


OK, you want some crazy ideas to fix this mess?

Actually, pretty much everybody knows these are the solutions, but nobody seems to have the balls to execute.

  • Why not privatize most government-owned companies and take them public? That competing with the private market. Period. And by the way, who needs 200 MPs in would shrink the public sector, cut government costs, boost their efficiency and create an exit market for the domestic SMEs that they will acquire.
  • We give a five-year tax-free period for all scalable growth companies from the point when they are founded. Finland also has to stop taxing corporate profits if they are not distributed outside the company. Yeah, I know this is an Estonian idea. So what?
  • We gotta bite the bullet on fixed costs. That means firing hundreds of thousands of civil servants and shutting down agencies that do admin, NOT reducing critical basic service providers like teachers, nurses and police.
  • Invest in sales. What this country lacks is not innovations, engineering skills or infrastructure. It’s good old-fashioned sales skills. Too many administrators, not enough sales professionals. We need an all-out effort to train and retrain the people who can adapt and import pros from the outside.
  • No more public or quasi-public monopolies or cartels and no more public sector players parliament in a country with only 5 million people?


They will say to all this that it can’t be done. I had a leading politician tell me last week that it just isn’t that easy. Of course it isn’t. No worthy endeavor was ever easy. But it can be done – if we have the will, the discipline and most importantly the moral courage.

It’s that last one that worries me the most, because the ones who need to make the change are the ones who stand to lose the most by making it. This game is now about people with power and influence making personal sacrifices for the greater good. That’s what civil service used to be all about – but not these days. These days it seems to be about narcissism and self-preservation.

And yet, and yet …. I’m one of those hopeless romantics that believes that each crisis gives rise to its own leaders. This crisis will be no exception. They are waiting in the wings. They are coming. And their wrath will be terrible to behold.

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