At the end of last week, Reaktor announced the rebranding of their venture capital arm to Reaktor Ventures, as well as revealing that they are aiming to make 20-30 investments every year, which would make them one of the most active investors in the Nordics.
Oskari Kettunen, Managing Director of Reaktor Ventures informed me that the pace they are investing at would probably match a €40 million fund, and he reaffirmed to me their intentions to become one of the top investors in the region.
With ambitions to make such an impact on the scene, I felt it was only right for Oskari to share with us what they are looking to invest in, what problems interest them and their predictions for the next twelve months.
Note: The questions and interview format is inspired by (and with the blessing of) Requests for Startups.
What startup verticals interest you the most right now?
There are a couple of sectors that are particularly hot in our region.
Gaming is obviously one of the strongholds of the Finnish scene and that industry is an interesting situation. We’ve seen a few shifts in which one or two companies really capture the moment and stake their claim. Everyone pretty much agrees the App Store pie is divvied at the moment. Still, as some smart industry veterans point out, no mature form of entertainment is as centralised as games right now. Something has to give. We have VR and AR coming up to shake things up, no one is sure yet when that market goes. Interestingly the new tech requirements make some of the old dogs’ tricks relevant again. There’s plenty to be made from shaking up the App Store and Steam’s supremacy, so there will be attempts.
Another hot area, that really fits the Nordic region’s tech heritage and culture well, is health and wellness. We see a strong cluster of startups already. Having gotten used to a welfare society and now facing the challenge of an ageing population, this region has no other way out than innovate. Consumer wellness concepts are pushing technology that starts provide more valuable information than methods developed in the cumbersome medtech environment.
What are your biggest predictions for the next 12 months?
2016 will see lot of grumbling already present in the startup bubble reach mainstream media. Some subprime unicorn very publicly imploding will be heyday for a lot naysayers. There will be some good in that, the overall picture becomes more balanced and the true value creators validated even more.
The European startup scene, slowed down by it structural weaknesses, will forever be catching up to the Silicon Valley and other US counterparts. But the upside is far greater capital efficiency. These ecosystems will keep developing and companies making good use of their more prudent funding rounds. Bubble-bursting in the States will of course have its repercussions through the financial markets, but the silver lining is that some more attention may be lavished to the great companies here.
Are there any specific company ideas that you really want someone to build and would potentially fund?
This is a toughie. If I had a very clear picture for one specific company, I’d probably have started it myself years ago. Right now I’m learning more and faster than any time before on my life from this growing portfolio of cool companies and inspiring entrepreneurs. Our investment thesis really relies on people. We understand many of the tools of their trade well, financing, technology, design etc. But the investments we really jump at are exceptional people and teams coming to us and schooling us on a problem space.
There are big problems that will be solved by startups, but I have no idea yet where they materialise in to a company. Technology is accelerating the division of society at a dizzying pace. Practically all readers of this are comfortably on that ride. More and more people are being left behind with no role in these industries where productivity of work is growing. The income and wealth gap is also a health gap, and an education gap, and a internet literacy gap. A lot of disenfranchised people fall pray to extremism in different forms, click baiting journalists play “truth in the middle” and we see cranks pitted against responsible scientists or politicians. Racism, extremism, anti-vaccination, chemtrail conspiracists… they’re all related to this.
Human potential is nowhere nearly as unevenly distributed as the current situation looks like. We need companies to reinvent education and the job market. We also need entirely new ways to organise ourselves to around big problems.
If you could wave a magic wand and instantly have any imaginable solution to a problem you're facing (personally or at work), what problem would you solve?
Since you’re indulging me with that emphasis on “personally”, I’ll say procrastination.
Instead of writing these words last night, I read Tim Urban’s series of blog posts on the topic. (http://waitbutwhy.com/2015/03/procrastination-matrix.html You should too, but finish that important task first.) I’m getting bossed around by that instant gratification monkey all the time. I wear a fitbit that often proves my intuition wrong about how I sleep or exercise. If it could track the amount of time I spend in each quadrant of the “Eisenhower matrix”, I’m sure it’d be truly depressing.
That magic wand would give me a tool to reprogram myself. I’m pretty sure the technology already exits, it’s just used to make people by more electronic gems. If had that technology to direct my curious instinct toward what I know to be important in the long run, I’d not only get so much more done. I would also be more mindful and present in my leisure time. Luckily my kids already do a pretty good job of grabbing the attention they deserve.
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