Venture Capital Denmark
In Denmark, VC financing has increased in recent years. More institutions are placing their confidence in the minds of developers and aspiring executives in the country, giving way for economic growth and innovation.
Venture Capital Denmark
Unlike other European countries, the venture capital market in Denmark is still in its early stages. Investments have started to pick up steam during the 1990s, while VCs reached almost forty deals in 2002. For Danish start-ups, the landscape is still quite malleable even today. In 2016, there was a decrease in investors’ number, but funds increased in terms of value. Sustainability seems to be the trend in the country as opposed to quantity, which can raise confidence for those who want their start-ups to gain traction.
Because of this trend in Danish VCs, companies have taken more significant risks in terms of projects. Several start-ups explore sectors such as studios, finance, and transportation. The diversity of these fields have made angel investors and other institutions look into the country’s emerging companies.
In 2019 the combined volume of funding for the top 100 Danish start-up companies scales up to 1.3 billion euros. That’s why analysts see the venture capital market in Denmark as “mature.”
This trend is beneficial because it attracts more international investors to the region, increasing the value of listings in the stock market. Although there might be slower movement, the uptick in value presents an opportunity for investors to place their resources in companies that will emerge as industry frontrunners in the coming years.
Thriving Software & Analytics Sector in Denmark
The most prominent sectors in the Danish startup market are Fintech and life science. Their combined funding volume is higher than other digital-related industries. However, we should not forget that the software and the analytics sector is also topping the chart. It has provided a significant amount of volume to the Danish startup market.
FinTech and life science-focused startups have been deemed the main contributors, leading the funding volume to rise to 56% in recent years.
Well-Known Start-ups from Denmark
Recent start-ups from Denmark are built on newly-emerging industries. For instance, Platypus is a start-up focusing on human resources. Companies may benefit from their service by finding out what their workers need regarding benefits and satisfaction. It presents opportunities to improve workplace environments.
And while remote working has become the norm due to current conditions, one Danish company has been on top of it for a few years. Pento’s goal is to deliver a payroll system that is more efficient and transparent. Companies will have access to a more convenient channel, while workers will benefit from seeing a more in-depth approach to receiving their compensation.
Pento is already used by over a thousand companies in Denmark and has already amassed nearly $3 million in funding. The company’s philosophy regarding remote working is commendable because they have been using that model ever since, making their current working operations stand effective amidst hurdles.
There are a lot of conversations about the threat of nuclear power. However, brilliant minds in Copenhagen are taking a new approach to this, seeing it as a way to innovate things for society. Instead of building a threat, nuclear power for Seaborg is a tool to save our planet from being barren. Fossil fuels are among the most unsustainable energy sources, and this company seeks to introduce a more cost-efficient and safer alternative.
To achieve this goal, Seaborg employs the most brilliant minds to work non-stop at their Copenhagen base. Since 2015, the start-up has enjoyed attention from several investors. It is one of the businesses to watch out for in terms of growth and promise.
Top Start-up Cities in Denmark
It makes sense to see Copenhagen as a central source for start-ups in Denmark. To an extent, this is true. Copenhagen is the capital city of the country and is home to significant economic and financial establishments.
It’s an important place for the economic growth of Denmark since the city offers a rich market ecosystem, which is an excellent factor in developing innovative market ideas. Copenhagen is the home of skilled and creative workers provided with necessary resources, facilities, and a productive environment. Thus, this part of Denmark is capable of producing and building up pioneering companies attractive even to international business angels.
However, other cities have also been emerging as places of innovation.
In the heart of the country, the city of Odense has proven to develop digital startups such as Teradyne Inc. Odense is also the city where robotics-based ventures such as OnRobot and Blue Ocean have garnered attention. Another emerging start-up in the city is MGMedia, a content creation company that has been making rounds across Denmark and other parts of Europe. Meanwhile, Champ is a cloud-based platform using machine learning to upscale images and videos in higher quality.
Aarhus and Aalborg are also becoming hotspots for scientific discoveries involving industries such as gaming, education, pharmaceuticals, and many others.
The city Aarhus has catered to significant companies contributing to the economic growth of Denmark. Here you can find various successful ventures such as AutoUncle and GameScoreKeeper. The Aarhus-based start-up ViaBill presents new payment methods for consumers, while Reflectly is an AI tool for relaxation and mindfulness.
In Aalborg you can find the Aalborg University which remains one of the largest sources for new innovations, with graduate students pioneering ventures such as the assistive technology ERGOTA and the sustainability platform Green Window.
Venture Capital Exits in Denmark
The maturing VC scene in Denmark has made investments in the country do well. The end of the 2010s allowed the country to enjoy a healthy economic rise. During a nine-year period between 2007 and 2016, it was observed that venture capital exits underwent an on-off period. These fluctuations led to a total of almost €300 million in divestments by 2016. The year with the largest number of exits was 2012, wherein €840 million in funds were divested.
In most of these venture capital exits, start-ups involving the life sciences are the most lucrative. Also, digital start-ups that involve artificial intelligence and communications have also been at the forefront of recent exits. These movements indicate the slow but organic rise of the Danish start-up ecosystem.
Although there are obstacles in venture capital financing, it presents a logical choice for funding start-ups. While often brilliant, these businesses need a lot of backing to turn their ideas into reality. These inventions and services may revolutionize the way people live out their lives, and Denmark has a lot to gain by building on this potential. Venture capital arrangements are still better than loans, which might take some time to be approved and distributed. VCs also serve as a de facto seal of approval from big players in the industry.
Venture capital financing provides start-ups with opportunities to contribute to innovation in society. As Denmark fosters their minds and talents, new ideas will emerge, and more financial deals will be closed.