Revolutionizing Early-Stage Tech Investments in Sweden

Revolutionizing Early-Stage Tech Investments in Sweden

May 16, 2024

Interviewed by Nicolas Sauvage on August 31st, 2023

“I’ve had the privilege of sitting on both sides of the table as an entrepreneur and as someone managing capital,” said Sara Wallin, CEO of Sweden’s Chalmers Ventures. “And this dual perspective has given me an invaluable understanding of what both parties need, which helps me bridge gaps and foster stronger partnerships.”

Sara met with Corporate Venturing Insider host and TDK Ventures President Nicolas Sauvage in August to share her experiences. With an extensive entrepreneurial background, Sara has been at the helm of the CVC for the past two years, leading some of the most innovative investments in Europe.

Chalmers Ventures

Chalmers Ventures is a strategic initiative born out of Chalmers Technical University’s entrepreneurial spirit. The university is a unique institution, Sweden’s only private technical university. But it’s not just the “private” aspect that sets Chalmers apart; it’s also renowned as one of Europe’s most entrepreneurial universities. This reputation was the foundation for the innovative ideas and forward-thinking researchers who launched Chalmers Ventures.

A single vision propels Chalmers Ventures’ mission: to become a global frontrunner in supporting research and knowledge-based growth companies. These companies, rooted in deep tech and fueled by visionary entrepreneurial teams, are seen as essential drivers for building a sustainable society and maintaining global industry competitiveness. This vision sets a clear direction for the organization.

“It’s all about fostering innovation and turning brilliant ideas from the lab into successful ventures,” Sara explained.

Chalmers Ventures’ distinguishes itself by investing in innovative tech startups with international scalability. By identifying and backing these startups, Chalmers Ventures positions itself as Sweden’s most active early-stage deep tech investor. Notably, it has also earned a spot in the top 10 university incubators worldwide, thanks to its ability to nurture tech-based ideas rooted in Swedish technical research. The fund thrives on innovation partnerships not just with researchers, students, and alumni entrepreneurs affiliated with Chalmers University, but from other Swedish universities and industry partners. The CVC welcomes ideas from external sources. It maintains these strong relationships in its vast network through the Tech Matching Initiative which bridges technology concepts and driven entrepreneurs within the network. This program helps transform groundbreaking research into viable startup companies, aligning visionary innovators with visionary teams from the Chalmers School of Entrepreneurship and the broader Chalmers Ventures network.

Professor Privilege in Sweden

Sweden’s approach to innovation is underpinned by a rich tradition of science and engineering, propelling the country into a trailblazing role in the green transition. One of the country’s standout features is its ability to generate groundbreaking ideas through research and education, but innovations often face challenges in transitioning from the lab to the market and expanding globally.

In Sweden, a concept known as “professor privilege” sets it apart from many other countries. Professors, researchers, and even Ph.D. students maintain ownership rights to the intellectual property they create. In most jurisdictions, these breakthroughs belong to the universities and institutions where the researchers work. This privilege is a cornerstone of Sweden’s innovation landscape, and Chalmers Ventures uses it to the fullest, allowing researchers to continue their academic work while actively contributing to their startups.

“Imagine a researcher still rooted in their academic role working in tandem with us and the entrepreneurs we’ve carefully matched to the venture,” Sara said. “So it’s a harmony of skills and knowledge where the researchers’ ongoing work in their field seamlessly integrates with the growth of their company”

Introducing Governance to Early-Stage Startups

Early on, the startup ecosystem can be resistant to governance. Founders, researchers, and entrepreneurs may view it as an unnecessary burden, failing to recognize its long-term benefits. It’s a common sentiment that companies only come to appreciate governance several years down the road when they begin to flourish, exit strategies emerge, and financial rounds proceed seamlessly. So, how can the industry break through this initial resistance and help early-stage startups embrace governance? By sharing real-world examples and feedback from companies that have already gone through the process, Sara said.

“It’s a struggle in the beginning to try and get them to see the benefits, but we are preparing them for the future,” she noted.

Enlisting the support of older, more established startups within the portfolio helps. Hearing directly from peers who have undertaken the journey can effectively convey the significance of early-stage governance. These veterans can offer insights into how governance isn’t just an obligation but a strategic asset that shapes the destiny of a company.

A Lucky Twist: Timing

For entrepreneurs, the career journey is laden with uncertainty, risks, and of course, the giant possibility of failure. However, as Sara pointed out, timing can play a pivotal role in determining a young startup’s fate. While market conditions, consumer trends, technological advancements, and other factors beyond their control exert their influence as well, Sara said impeccable timing is a powerful determinant in the entrepreneurial realm, highlighting the empathy it creates.

“Sometimes you’re lucky, and you get the right timing. But I think you have to experience both failures and success,” she explained. “Then you will understand that it’s not always your fault that it fails, it might be the wrong timing.”

When entrepreneurs experience both failures and success, they come to understand that not every downturn is a reflection of their abilities. Sometimes, it is simply a matter of timing and luck. This newfound empathy becomes an extremely valuable asset as Sara and her team interact with CEOs, providing a platform to offer support and guidance with a deeper understanding of the challenges and uncertainties they are facing. Knowing when it is time for empathy is key because it transforms the entrepreneurial ecosystem into a more compassionate and supportive community.

With personal experience as an entrepreneur herself and a team backed with a deep commitment to supporting Sweden’s innovation ecosystem, it’s no wonder that Chalmers Ventures has and will continue to receive notable attention within the CVC landscape.