What do you think about the Danish investment culture?
It is like a local environment where everyone knows everyone, and we all run after the same people. I think that we should be better at promoting Danish talent and attract foreign VC’s. A good example is DemoDayDenmark because it creates positive publicity for Danish startups. But it is not enough!
I would not say that we have a 100% founder friendly culture today. There is room for improvement. Often, I see investors who are way too aggressive, and they drive the founders so hard that they lose their passion. We all want to make money, yes. But it has to be fun at the same time. For me it is very important to be passionate about the things I do. One of the biggest reasons a startup is successful, is when the founder team is passionate about their work. If you just want to make money from the start, the result is rarely as good. Communities and customers are driven by inspiring people, not profit. However, investors do not always really understand this.
What is ‘founder friendly’ investments according to you?
Founder friendly investments are about looking out for the founder in the contract. When the focus is on the benefit of the founders, so they won’t be diluted too much and end too low down on their own cap table and risk losing their motivation completely – or be forced to take the company in a completely different direction just because it is faster to earn money that way.
If we want to keep the talent, I think that we have to make the first two years of profit free of tax, so that the company can reinvest its profit into growth. Furthermore, we should look at the ecosystem in Switzerland where they can make tax-free exits. Danish taxes and VAT are often the reason why many startups move out of Denmark as soon as they become big enough. With this solution, I believe that more skilled and experienced people could see the idea of starting their own business which would result in more jobs locally.