This is how the land of a thousand lakes, unicorns, and phoenixes has been shaped by Nokia – and still is
Throughout my trip to the SLUSH Conference in Helsinki, Finland, I was constantly encountering a number of themes regarding Finland’s evolution into a startup hub, mostly revolving around Nokia. In the era of Nokia’s dominance as a handset manufacturer, there was an unspoken social contract that promised to reward hard work with a steady stream of good jobs with one of the biggest employers in town.
When Apple came out with their first iPhone, the foundations of Nokia’s empire began to shake. Over time the former giant shed much of its former staff which, coinciding with other issues in their economy, has been a part of a downturn affecting the whole of the country.
When the handset business was sold to long-time partner Microsoft last year, it signaled the end of Nokia’s time in this field.
The lynchpin of the economy?
This claim that Nokia’s fall has been dragging Finland down seems superficially pessimistic to me for a couple of reasons, not the least of which comes from a fundamental lack of familiarity with Nokia’s past. Throughout its 100-year history, Nokia has gone through a series of pivots, which have in large part impacted the personality of the nation.
Nokia went from manufacturing rubber, to building telecommunications infrastructures, and then to wireless handsets. Along the way, they developed the essential skills of how to work in the international market and establish engineering as a core of their educational focus.
When change came to Nokia, the layoffs were handled relatively well to help many of the former employees start out on their own or find jobs elsewhere. Strong institutions such as healthcare and government support helped people during their transition. The education system continued to churn out ready talent, hungry for work.
One of the institutions that has helped to keep the ecosystem alive and growing has been the funding agency Tekes, which provides grants to companies.
The fact that gaming had already started to grow on platforms like Facebook and within Nokia meant that by the time the App Store opened in 2008 and the mobile market continued to explode, the Nokia refugees had the beginnings of an ecosystem that was ready to grow fast.
The initial proof came in 2009 with the runaway success of Finnish Rovio’s Angry Birds and then unicorn Supercell’s Hay Day and Clash of Clans in 2012, attracting Softbank and Gungho to buy 51% of the latter company for $1.5 billion in 2013.
Turning lemons into high class limoncello
While I was making my way around through SLUSH, it became clear that Finland had embraced one of the most important parts of any sustainable startup. They knew how to pivot. This fact became more evident as I moved from meeting to meeting, speaking with teams who were either former Nokia employees themselves, or had scooped many of them up when they became available on the market.
Companies in the IoT sector like Thingsee and Nuviz, with the latter setting up their R&D facilities in Salo — a major telecom site back in its heyday — are great examples of companies that were able to come into being after Nokia’s shakeup. They have the talent to branch out beyond telecomm, and are showing it with new innovations.
Waking the old beasts
Nokia itself has found its way back onto the stage. Their team brought with it an impressive offering to the SLUSH floor with the OZO 360° camera as it joins the virtual reality revolution. They are focusing now on other areas of communications, going back to their roots with mobile infrastructure projects.
While they have lost the right to manufacture mobile devices under their own label, they will have the licensing returned to them. This has been a source of hope for people in former company towns like Salo who yearn for the days of steady jobs and ease of the early 2000s.
However, hopes for the glory days seem to be misguided since the past can never really be repeated. Nor should they be. Listening to many of the people presenting at SLUSH, they are developing technologies that reach beyond the limitations of only one sector, bringing with them the value gained from their experience at Nokia.
Newer fields like healthtech, wearables, fintech, and IoT, as well as more established areas like software design are all benefiting from these skills, and opening a new set of opportunities for the next generation.
Once the beacon of Finnish industry, Nokia’s simple yet reliable phones were decimated with the entrance of the iPhone. The transition has been anything but smooth as Finns have re-found their feet.
However, far from broken, they have rebounded with a push towards new directions, building a more diverse and stable future for their country.