Known as Europe’s “unicorn factory” and home to more $1 billion-plus companies per capita than anywhere outside of Silicon Valley, it’s safe to say that Stockholm’s success is hardly a secret. And yet, 2019 shows that the city still has plenty of tricks up its sleeve and is not content to rest on its laurels.
As the year comes to a close, we take a look back at some of the exciting innovations, new technologies, strategic partnerships and international recognition that made this yet another successful year for the Swedish capital.
In no specific order, here are our picks for the top ten tech stories to come out of Stockholm in 2019.
1. The place to be for Gen Z
As we look back on 2019, it’s only natural to also cast a glance toward the coming decade and beyond. The 2020s will see Generation Z mature into the job market and all of that new talent will naturally be weighing their options for where to start their careers.
If these digital natives have been paying attention to the host of studies looking at which cities are best positioned to welcome Gen Z, they’ll know that Stockholm consistently comes out on top. Whether it’s taking second place in Nestpick’s ‘Generation Z Index’ or Sifted’s ‘most attractive cities to Gen Z’ list, Stockholm’s reputation as a green and innovative city is sure to continue to attract young talents from around the world. Clearing the way for these workers to more easily establish themselves in the city, Stockholm Mayor Anna König Jerlmyr announced a slew of proposals to make it easier for startups to recruit workers from abroad and make the transition to the city easier for the arriving talent.
This influx of young talent will find themselves in a city that was declared just last month to be one of the three best startup ecosystems in the world by the SparkLabs Group. SparkLabs partner Bernard Moon tells The Local that Stockholm has long been in an attractive startup destination, in part because of the diversity of its scene.
“We like Stockholm because it provides a live base of innovation,” Moon says. “It's not just narrowly focused on one or two sectors. If you look at London, for example, it's primarily FinTech. Stockholm is definitely more diverse and I think that reflects on the talent base, and also just the curiosity of all of the entrepreneurs there.
2. It’s official! Stockholm is the world’s smartest city
In late November, representatives of some 450 cities around the world descended upon Barcelona to tout their municipalities’ latest innovation and transformation initiatives in an effort to be dubbed the world’s smartest city. But in the end, it was Stockholm that was officially declared the Smart City of 2019.
The annual Smart City Expo World Congress judges picked the Swedish capital as the winner for its approach to fostering a smart, connective and innovative environment for the city’s residents and businesses. Stockholm’s role as one of three ‘Lighthouse Cities’ piloting the GrowSmarter approach to reducing carbon emissions in energy, infrastructure and transport was also cited as a reason for its win over fellow finalists Curitiba, Brazil; Tehran, Iran; Bristol, England; Montevideo, Uruguay; and Seoul, South Korea.
3. Not just the smartest – the most competitive and one of the best places to invest
‘World’s smartest city’ was hardly the only superlative Stockholm could brag about in 2019. The Stockholm region was also declared the ‘most competitive’ in the European Regional Competitiveness Index, where it outperformed 267 other regions across the EU. Stockholm was the only region to score a perfect 100 on the index and was lauded for its strength in health, human capital and innovation.
Another report that highlighted Sweden’s strength as a country was the Global Transactions Forecast released in October by Baker McKenzie and Oxford Economics. Here, Sweden was named the eighth most attractive country in the world for mergers, acquisitions and IPOs. Although the report predicted that Sweden’s total value of corporate transactions would fall to $16.7 billion in 2020, compared to $36.6 billion in 2018, it forecast a rebound in 2021 and 2022, where the total was predicted to land at $23.6 billion. Meanwhile, the total value of Swedish IPOs was expected to increase to $1.5 billion in 2021 and $1.64 billion in 2022, significant jumps from the $802 million Swedish IPOs brought in during 2018. The report predicted that Sweden’s “gradual recovery in deal-making” would gain momentum in the early years of the next decade, making it one of the best countries of the world in which to invest.
4. Stockholm startup to build Europe’s largest battery factory
The Stockholm-based startup Northvolt announced in June that it had raised $1 billion in equity capital and would begin constructing a massive gigafactory for lithium batteries in Skellefteå. The gigafactory, named Northvolt Ett, will begin producing 16 Gigawatt hour (GWh) batteries in 2021 before eventually moving on to manufacture 32 GWh batteries. In addition to the Skellefteå factory, which will be the biggest in Europe, the young company announced plans for a large factory in Germany and already has smaller facilities under construction in Västerås, Sweden and Gdańsk, Poland.
Northvolt raised $100 million in June alone, accounting for the biggest VC-backed fundraising round of the year according to Atomico’s State of European Tech Report. June’s haul is just part of the $13 billion the company has raised to cover its operations through 2030. Founded in 2016, the Stockholm company has grown from just 12 to almost 300 employees and has positioned itself as a major rival to Tesla.
5. FinTech scene grows (with some help from Snoop Dogg)
The explosion of Stockholm’s financial technology sector was one of our top tech stories last year and any worries that things had peaked went up in a cloud of smoke just weeks into 2019. In mid-January, hip-hop icon Snoop Dogg announced that he was investing in online payment company Klarna and by the end of the year, the Stockholm-based company was Europe’s most valuable fintech business. With the success of unicorn disruptors like Klarna and iZettle, Stockholm has become a true hotbed for fintech startups and has inspired a host of new players, including Truecaller, which announced that its popular called ID and spam blocking app would transition to a ‘superapp’ with new payment and credit options. 2019 also saw the launch of the new fintech hub FinDec and STHLM Fintech week, which will be back for another round in early February. With things moving so quickly within the sector, no wonder Invest Stockholm released an official fintech guide over the summer.
6. FoodTech stakes its claim
While the fintech scene continues its boom, a whole other sector is also blossoming in Stockholm: FoodTech! The Swedish capital has quickly begun attracting talent and investments from those looking to shake up the food industry. June saw those hungry for innovation descend upon Stockholm for the Future Food Festival, the Sweden Foodtech Big Meet and the EAT Stockholm Food Forum.
At the heart of the burgeoning foodtech scene is a desire to make the food sector more sustainable, no small matter when considering that food loss and waste alone are estimated to account for eight percent of total global greenhouse gas emissions. Through the use of data and technology, the emerging players within Stockholm’s foodtech scene are looking to disrupt food production in a sustainable and delicious way. Expect to hear – and taste – much more from Stockholm foodtech startups in 2020.
7. New data centers abound in the Stockholm region
In the closing days of 2018, Microsoft announced that it had purchased 130 hectares of land north of Stockholm, a precursor to the two additional plots of Swedish land the US software giant would buy for data centers during 2019. But Microsoft is hardly alone in eyeing the Stockholm area for data centres. In November it was announced that Advania Data Centers, Interxion and IP-Only had decided to build new data centers in Stockholm Data Park Kista. Once operational, these large-scale heat reuse data centers have the potential to heat more than 35,000 modern residential apartments in Stockholm.
Stockholm Data Parks also added a new 220,000 square metre site in Brista, close to Arlanda Airport, with 20 MW power available and with the possibility for heat recovery.
8. A woman’s place … is in tech
2019 was a fantastic year for Swedish women in tech and, if you’ll indulge the self-promotion, us as well! The campaign ‘A Woman’s Place’, a collaboration between The Local and Invest Stockholm, reached five million unique people and had 9.6 million social impressions. But most importantly, 100 Stockholm companies have now joined the initiative to support equal opportunities for women and men. ‘A Woman’s Place’ also picked up some awards during the year, including third place in the 'Best Use of Online Media' category in the Native Advertising Awards. It was also listed by Sifted as one of Europe’s top gender diversity initiatives and nominated in The Best of Class 2020 City Talent Attraction award, while the corresponding podcast was also highlighted as one of the 15 best gender equality podcasts in the world by Feedspot.
For one weekend in September, Stockholm was home to Europe’s biggest gathering of female hackers. Over 800 women from around the world gathered in the capital to take on ten different hacking challenges and raise awareness of the gender funding gap within the tech industry. Invest Stockholm plans to use a grant from the Swedish Agency for Economic and Regional Growth (Tillväxtverket) to further its work in closing the gender gap in 2020 and beyond.
9. It’s game on for Stockholm’s gaming industry
It’s no secret that Stockholm is home to a deep roster of cool gaming companies. In fact, the Swedish gaming industry has become so successful, so fast that there are even concerns that there aren’t enough employees to go around. But these growing pains certainly don’t seem to be affecting the interest of investors. 2019’s biggest gaming investment saw the Korean game publisher Nexon invest nearly 900 million kroner in the Stockholm-based Embark Studios. Nexon’s move is indicative of increasing interest from Asian investors looking to get in on the ground floor of the next gaming startup to come out of Stockholm. With the proven track record of giants like King, Mojang, Dice and Paradox Interactive, the city has already proved its mettle when it comes to producing hit games from hot studios.
Stockholm’s gaming reputation was no doubt part of the reason it was chosen to host The International 2020. When this concluding tournament of the Dota Pro Circuit comes to Stockholm in August it will be the first time the major esports event has been held in Europe since 2011.
10. Stockholm: The city for impact investing
The tech world isn’t just fun and games, of course. That’s why Invest Stockholm teamed up with both Impact Hub and the Norrsken Foundation to support local entrepreneurs. The partnership with Impact Hub, the world’s largest network for social entrepreneurs, is aimed at creating a larger and more diversified startup scene while the collaboration with Swedish non-profit Norrsken focuses on nurturing sustainable solutions and climate-smart technologies. Just before Christmas, Norrsken announced it will launch a €100 million impact fund to support entrepreneurs who are solving the world’s greatest challenges such as poverty, discrimination, mental health, integration, food waste, and climate change.
One Stockholm startup already generating climate-smart ideas and products is Exeger, which in 2019 partnered with Japanese conglomerate SoftBank for a global rollout of its solar cells and announced a line of light-powered headphones in a collaboration with American audio company JBL. The Stockholm-based Climeon also revealed a pair of high-profile partnerships during 2019. The clean-tech company in May announced a collaboration with Breakthrough Energy Ventures that will accelerate global deployment of Climeon’s unique power system that turns hot water into clean electricity. Just two months later, Climeon detailed plans for how its Heat Power system can play a key role in the maritime industry’s transition to greener energy.