Sweden was early to establish itself as a leading exporter of consumer-facing technologies and technology companies. Spotify, Bluetooth, Skype, Ericsson, and SoundCloud – to name but a few – were all created by Swedes in the late nineties and early noughties, and are today global household names.
Perhaps less widely celebrated is the Swedish innovation in e-commerce that has emerged over the last decade. Companies like my own, RevolutionRace, which nearly doubled sales in our most recent quarter, along with Klarna, Tictail, Bambuser, NA-KD, and others, have been quietly taking the world by storm with e-commerce-first business models.
This June, I became the first woman to bring her company to the Stockholm Stock Exchange as a CEO in the Exchange’s 160-year history. I don’t think it’s a surprise that it was an e-commerce platform that broke this particular Swedish milestone – e-commerce requires a fierce interest in the crossover of retail, breaking technologies, and the social-driven aspect of the online world, utilizing data and creating communities willing to be part of an ongoing online feedback loop that helps brands adjust and develop with agility.
But there are a few particular factors – both societal and commercial – that make Sweden in particular a good bet for the source of the next e-commerce unicorn.
The pandemic is often touted as a major catalyst for the transition from physical shopping to digitalized systems. But Sweden had already begun this process long before the world was hit by COVID.
The Swedish government and the Central Bank have long encouraged the population and companies to adopt cashless behaviors, in part, as a means of decreasing criminal activities such as money laundering and tax fraud.
In 2012, the biggest banks in Sweden joined forces to create a new, modern method of digital payment, which resulted in the launch of Swish, a digital payment solution that quickly became near-universal in Swedish society. Swedes eagerly adopted practical and comfortable alternatives to cash payment and today, 92% of adult Swedish internet users rely on Swish.
The introduction of Swish was accompanied by the appearance of other digital services such as the cross-bank initiative BankID, a digital identification app. With 95% of internet users in Sweden now using BankID, the modern Swede has little need to carry cash.
This all has created an opportunity for e-commerce to invest in smart and safe digital solutions to accommodate our tech-savvy population. Swedes generally being early adopters of digital payment services, Swedish companies were quick to realize the potential beyond the local market. Klarna is a great example of a company that has taken the Swedish behavioral formula and applied it on an international level. Companies like Klarna have enabled e-commerce businesses to thrive through widely applicable and replicable alternative payment solutions.
Back in 1998, the Swedish government issued the so-called ‘’Home-PC Reform’’, which would allow employed Swedes to rent or borrow a computer, tax-free. Under this reform, many Swedes were given the opportunity to learn the fundamentals of using a computer, and general computing proficiency accordingly increased, putting Sweden ahead of many other European countries in this regard.
Sweden also offers excellent university courses within tech and IT. Combined with the Swedish educational system which provides tuition-free university education and the availability of student aid, a tech-savvy population has long been a part of the Swedish plan. Sweden is now amongst the most computer literate countries in the world.
Sweden’s investment ecosystem makes it straightforward for Swedish startups to collaborate with key investors to gain venture capital. Swedish investors have a good reputation internationally and strong global networks, which benefits up-and-coming companies based in Sweden but with worldwide ambitions. A great example is Altor, which first backed RevolutionRace back in 2017, and has been a key partner in our expanding to over 35 countries.
Another example is Northzone, which has been quick to realize the potential of what used to be smaller Swedish startups – including Klarna, NA-KD and Spotify to name a few – that have now turned into world-famous powerhouses.
Swedish entrepreneurs, decision-makers, and investors naturally have an interest in maintaining this nurturing commercial environment, which further has resulted in a ‘payback culture’ where successful startup founders re-invest in the ecosystem and other promising companies.
In conclusion, there are natural reasons why Sweden is an ideal hotbed for successful e-commerce business models. It is a natural breeding ground for e-commerce unicorns, and a perfect place for active and aspiring entrepreneurs to work in. Watch this space.
Pernilla Nyrensten is the first-ever woman to take a company to the Stockholm Stock Exchange and stay on as CEO. Her company RevolutionRace is a D2C-retailer of outdoor clothing, which Pernilla first founded in her father’s garage in 2013.