IRIS Group has conducted a study that aims to build a stronger knowledge base on key drivers of growth and barriers to scaling among Nordic companies. The analysis is based on in depth interviews with 50 Nordic scale-up companies, investors and policy experts as well as a review of academic papers and recent analyses of scale-up companies, growth barriers and scale-up policy.

Among other things, the analysis shows that:

• The Nordic region has the potential to become one of the leading scale-up hubs in the world. Drawing on internationally comparable data, the report shows that in all the Nordics, the number of scale-ups per capita is well above the EU average. But there is also a significant gap between the Nordics and two scale-up champions: the USA and Israel.
• The process of scaling up from a start-up with a handful of employees to an international company with hundreds of employees can be divided into three growth stages – growing to scale, expansion and global strategy. Each growth stage is characterised by a broad range of growth challenges that all companies – to some extent – face and must overcome to continue to the next level of growth.
• Challenges on the growth journey are diverse and include: Finding the right product market fit and tapping into a large or growing market, developing market credibility and effective sales channels, assembling a management team with complementary skills, recruiting qualified and dedicated employees, building a company culture unifying employees across professions and borders – just to name a few.
• Certain internal and external factors have a great impact on the extent to which companies succeed in achieving high growth. These include:
  • Having ambitious founders that are 1) aspiring to build a global company from day one and 2) capable of recognising their own shortcomings and motivated to access the skills they need.
  • Developing a product that satisfies a great and unmet market demand – and continuously focusing on how to refine and develop products and services to make sure that they meet the customers’ changing demands.
  • Establishing a growth ready organisation that is tied together by a strong layer of senior and middle managers who have bought into the values and mission of the company and are capable of unifying departments.
  • Raising capital from a broad range of investors with whom the company management has a good chemistry and shared business visions.
  • Accessing and retaining world-class talent – including specialists, managers and generalists – by means of personal networks, internal training programs and cooperation with research institutions.