Differences between running a startup in Sweden and a startup in Silicon Valley. Presented at Stanford's "European Entrepreneurship & Innovation" (http://www.europeanentrepreneursatstanford.com) in Jan of 2012.

1. It’s All About
Relationships
Running startups in Sweden and the Valley
Huh? Nope.
Experiences from running *a* startup in Sweden
and the Valley
Emil Eifrem, CEO @emileifrem
emil@neotechnology.com #neo4j
Sunday, January 15, 2012 1

2. Agenda
• Wait, wut? What is Neo Technology?
• Entrepreneurship in Sweden vs
entrepreneurship in the valley
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3. Neo?
• Neo Technology Jan 2012:
• 25 people / Six countries / Three
continents
• Raised a total of $13M ($10M of which in
Fall of 2011)
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4. Customers
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5. Community
Source: The451Group’s report “NOSQL, NEWSQL and Beyond” (http://the451group.com)
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6. Awareness
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7. Product
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8. Data model
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9. Data model
LOVES
LIVES WITH
LOVES
OWNS
DRIVES
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10. Data model
name: “Mary”
LOVES
name: “James” age: 35
age: 32 LIVES WITH
twitter: “@spam” LOVES
OWNS
property type: “car” DRIVES
brand: “Volvo”
model: “V70”
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11. “Whiteboard friendliness”
Image credits: Tobias Ivarsson
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12. “Whiteboard friendliness”
thobe
Joe project blog
Wardrobe Strength
Hello Joe
Modularizing Jython
Neo4j performance analysis
Image credits: Tobias Ivarsson
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13. Graph db performance
Tobias
Emil
Johan
Peter
Database # persons query time
MySQL 1,000 2,000 ms
Neo4j 1,000 2 ms
Neo4j 1,000,000 2 ms
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14. </promotional material>
Sunday, January 15, 2012 14

15. Sweden vs Silicon Valley
*My* perspecive
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16. The Success of Sweden
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17. ... and there’s more!
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18. ... despite this:
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19. ... and this:
“Tax burden as percentage of
GDP”
(OECD 2010)
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20. My observations (thus far)
• Let’s compare Sweden and the valley along six axes:
• Competence
• Funding
• Government / Policy
• Culture
• Market
• NGO (Nitty-Gritty Operations!)
• Warning: Bring huge grain of salt. All of these are just
subjective reflections and heavily (enterprise) software biased.
Sunday, January 15, 2012 20

21. Competence -
employees
Swedland The Valley
• Very high average skill • The best in the valley are the best in
the world
• High and early internet
penetration • Deep technology mainly based on
experience from leading tech
• Predated by early PC
companies like Facebook, Google,
penetration (“home PC
reform”) etc
• Probably among the best in the • But combined with a general
world when it comes to mobile savviness about running a startup
(because unlike in the valley, mobile
phones actually work) • Most sophisticated and influential
early adopter consumers in the
• Employee affinity is higher world
Sunday, January 15, 2012 21

22. Competence - mentors
Swedland The Valley
•
• None. Most experienced and clueful
in the world. (x)
• They all suck, (*) • Most willing to share in the
world. (y)
because if they
• x * y = leaps and bounds
didn’t they already ahead of anyone else in the
world
moved to London
or the Valley. • Don’t think anyone will
catch up for several decades
* For a pretty strict definition of all.
Sunday, January 15, 2012 22

23. Funding - VCs
Swedland The Valley
• The top 5 are really good, on
par with the best in Europe.
• The rest are money managers
•
with a finance background.
Smart people, but with no
• The best in the
operating experience. world.
• And can’t asses product or
technology risk => no early
stage intuition or mindset.
Sunday, January 15, 2012 23

24. Funding - Angels
Swedland The Valley
• Very rare with any type of angel
capital.
• “Smart” (i.e. experienced in
software or internet service
startups) angel capital non-
existent. • The best in the
• Government tries to fill the role, world.
with minor (but not zero)
success.
• Especially troubling since there
really are no early stage VCs.
Sunday, January 15, 2012 24

25. Government / Policy
Swedland The Valley
• Some immature legislation, for
example around options
•
•
Strong labor laws
• I guess very pro-
“Quick to hire, never fire”
business?
• But legislation / policy don’t really
move the needle in either
direction in my experience: • In reality just seems
• Taxes don’t really matter pro lawyer to me.
• Setting up a company is
equally easy
Sunday, January 15, 2012 25

26. Culture
Swedland The Valley
• Less quarter capitalism than the
valley and more long-term • Echo chamber rocks
sustainability for staying on the
• OTOH, less “shooting for the leadin’ bleedin’ edge
stars”
• Supposed challenges that haven’t
been a problem (for me): • Everyone’s as clued
• Cultural fear of failure in about startups as
• Lack of fellow entrepreneurs you are
Sunday, January 15, 2012 26

27. Market
Swedland The Valley
• Small domestic market
• Harmonized, US
• Swedish is only spoken in domestic market,
Sweden (and some 5% of strongest economy in
Finland)
the world
• Companies have to go
outside of Sweden for • High influence
scale consumers, trend
• For good and for bad setters
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28. Nitty-Gritty Operations
Swedland The Valley
• Trust makes a lot of • Guilty until proven
things easier otherwise (and probably
a little bit longer)
• Invoices are kinda cool
• The social fabric in • Service providers galore
Sweden is very powerful
• But everything in the
• Parental leave, medical valley is less friction and
benefits, daycare, etc more liquid
Sunday, January 15, 2012 28

29. Remember those logos?
• Why does Sweden have a disproportionate (to its
population) amount of “global” startups?
• Some ideas:
• Small domestic market -- has to go outside
• High PC penetration -> Internet penetration ->
Working Mobile technology
• Good English
• Reaaaally cold winters?
Sunday, January 15, 2012 29

30. But the valley?
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31. Why is Neo HQ
now in the valley?
• Superior graph:
• Access to the smartest and most experienced
senior talent (executives, mentors, value add
angels) on the planet
• Access to the smartest and most experienced
capital on the planet
• All (non-catastrophic) exit paths are easier here
• This is the center of gravity for our
industry
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32. Thank you!
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