The Economist has a great article on why many of Europe’s top companies are Nordic.

The region has 0.3% of world’s population (~27m) but contributes 1% of GDP.

Top names include:

▫️LEGO (Denmark): World’s top toy maker by revenue.
▫️IKEA (Sweden): Largest furniture maker in the world.
▫️Novo Nordisk (Denmark): Ozempic creator and Europe’s largest company.
▫️Klarna (Sweden): Biggest buy-now-pay-later (BNPL) firm in the world.
▫️Carlsberg (Denmark): 6th largest brewer in the world.
▫️Spotify (Sweden): World’s top music streamer.
▫️Rovio/Supercell (Finland): Leading mobile game developers (“Angry Birds”, “Clash of Clans”).

The magazine cites 4 reasons for success:

▫️Internationalization: The Nordic market is small, so ambitious firms have to build for global markets (leading US firms generate 46% of revenue domestically; that figure is just 2% for leading Nordic firms)

▫️Early adopters of technology: LEGO famously rode the plastics revolution in the 1950s and IKEA innovated furniture with flat packing. Today, Nordic firms are faster to digitize than their European counterparts (eg. much higher cloud computing usage)

▫️Government policy: Personal tax rate is high but corporate tax in line with America. High income tax funds social safety net programs that help de-risk entrepreneurial route (also, Heritage Foundation ranks Denmark, Norway, Sweden in top ten of countries worldwide for economic freedom)

▫️Patient shareholders: 4/5ths of “large Nordic companies have long-term ownership, compared with 3/5ths in Europe and only 1/5th in America”, which allows for long-term thinking (private business families — Ikea, LEGO, Maersk, Wallenbergs — are also prominent in region and stymie foreign takeovers)

Nordic companies have obviously taken Ls (eg. recent collapse of battery maker Northvolt; previous clapping of Nokia by iPhone). But still impressive results! 

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Full read here: https://t.co/pQxFQ46Oj4