Go East, young startup


Finnish businesses are looking East for partners, investors and talent – but above all for Asia’s perfect storm of growth.

East is East and West is West, and never the twain shall meet,” wrote Rudyard Kipling in 1889 – so long ago we can excuse him for a certain lack of business foresight. In the Asian Century, experts predict that everyone in the business world will have close interactions with the East – the sooner, the smarter.

The rush to the East has witnessed unprecedented growth in partnering between Finnish and Asian businesses over the past decade. A recent headline case is Supercell, creators of hit games Clash of Clans and Hay Day. Last year the Finnish mobile prodigy raised eyebrows selling a $1.5 billion (€1.09 billion) stake in its business to Japan’s SoftBank.

Great call of China

The call of Asia is beckoning newcomers such as Jolla, a fearless Finnish startup formed three years ago by a group of ex-Nokia employees. In a real-life David and Goliath battle, Jolla plans to shake up the smartphone duopoly with its new handset launched last year. The Jolla phone runs on an open-source operating system called Sailfish OS, which will soon be downloadable on Android devices. 

Waiting to board a flight bound for Jolla’s second home of the past two years, Hong Kong, Jolla co-founder and CMO Sami Pienimäki makes no secret of Jolla’s geographical focus: “China is where the money is. Developed markets offer only marginal opportunity for seizing market share, but China is more dynamic.”

Jolla’s R&D team are constantly tweaking the phone’s features based on feedback from its user community. “Scandinavian design is recognised for its quality, but Asians prefer a richer user experience,” says Pienimäki.

Jolla’s strategy for expanding its ecosystem is an open model of partnering with Asian operators and influential players such as Yandex, or “Russian Google.” “But Jolla is still very much a Finnish company and will remain headquartered in Helsinki,” says Pienimäki.

Musical gateway

Another Finnish tech developer expanding its Asian presence is “edutainment” start-up SongHi Entertainment Ltd. Their mission is to bring the fun of music creation to everyone, regardless of income or background.

“Our app offers a ‘gamified’ entry point into the world of music – much sexier than tooting a recorder in a classroom,” says CEO Jussi Aronen, zanily clad in the company ‘uniform’ of purple with leopard trim. “Musical instruments are very expensive in Southeast Asia, so we offer an affordable alternative.”

Aronen recently completed a round of negotiations with government agencies in Malaysia, Korea, Japan and Indonesia, as well as with partners in China. “The Malaysian government has made massive infrastructural investments to provide every student with an internet connection and wireless device. They are very keen on our app,” he says.

SongHi is also gearing up for the launch of the first in a series of mobile games. “Our mission is to do good by helping people around the world explore music in an individualized way. The gaming side is where we expect to generate revenues first.”

In the bag

Bag business Insjö offers a fresh-faced example of bubbly East-West chemistry. The business took off when Chinese postgrad student May Huang won the hearts of Finnish investors with her disarming pitch at Aalto University’s Startup Sauna.

“You know the sinking feeling when you find that you left your wallet, keys and lipstick in your other handbag? With Insjö’s bagINbag, you can handily transfer the entire contents in one go. It meets a real need – to be beautifully organized,” explains Huang.

Thanks to her contacts in Guangzhou, the lead-up from ideation to production took only three months. Normally it takes up to a year.

Insjö’s marketing is handled by UK-born Alex Vieler-Porter, who foresees a growing number of future companies operating with one foot in the East, one in the West. “They need to cast a wide net for the best expertise,” says Vieler-Porter. 

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Text by Silja Kudel
Photo by iStock

A longer version of this article was published in Finnair's Blue Wings magazine (June 2014)


Published June 12, 2014

Category: Local features