New Scandinavian Investor Climate Report

Mar 19, 2021

8th of April Medicon Valley Alliance is organizing the webinar “Early-stage Funding for Life Science Companies in Medicon Valley“. As part of the programme, we have invited Johan Ny, CEO of NY Consulting to present highlights from his recently published “Scandinavian Investor Climate report“. As a little appetizer, we have also used the occasion to ask him a few questions about his findings and recommendations,

Q1) What are the key obstacles to creating a more attractive Scandinavian investor climate for life science

Scandinavia has great potential with solid research and an ecosystem of service suppliers that support commercialisation efforts. However, the main life science investor climate obstacle is the lack of early-stage funding to build a solid base of companies that can grow into future success cases. There is also a challenge in later investment stages where there is a lack of large venture capital investors. They are needed to handle the substantial investment rounds required to move into, and through, clinical stage development. There are examples where this has been possible, but more cases could have pursued the same route with better access to venture capital. The public listings options, primarily in Sweden, have provided an important funding alternative for many companies in an early-phase.

Q2) Based on the findings in your report, what are the low-hanging fruits if you want to improve the investor climate for Scandinavian life science?

There are several activities that could support the life science investors climate. There are three that I believe stand out: 1. Increase access to soft funding in early-stage phases (pre-seed and seed) to improve proof of concept development from both scientific and commercial point of view. 2. Increase of Scandinavian pension funds and public institutions acting as limited partners in new venture capital funds. This could widen the access to professional investors and increase number of local syndication partner options for international investors. There are examples of this already, but it should ideally be scaled up. Creation of life science specific business angel funds is another option that could add more syndication partners to complement venture capital funds in early stages, and also allow for more follow-on round participation. 3. Improve cross-border collaboration to activate the combined strength of each of the Scandinavian countries in an international setting. There are many clusters that compete for funding and the best talent in Europe, USA and Asia. The more the Scandinavian countries can work together to boast joint strengths the better.

Q3) From a more narrow Medicon Valley perspective, what would be your recommendations to Danish and Swedish decision-makers interested in developing and promoting the Medicon Valley life science cluster´s ability to attract local and foreign investors?

I believe it is important to promote and communicate the success cases sprung out of the Medicon Valley life science ecosystem. This will attract both international life science specialist investors as well as increasing the local investor interest in Danish and Swedish life science companies. The large Danish life science companies should ideally work even more with both Danish and Swedish universities and incubators. This could benefit their investment and partnering pipeline opportunities as well as strengthening the competitiveness of the whole region. Finally, increased access to early-stage public funding for start-ups could allow for both scientific and commercial validation to reach proof of concept status – a pre-requisite for attracting investors.

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