Early-stage rounds increased to 196 in the New Nordics — byFounders 2023 report

Copenhagen-based community-powered early-stage VC byFounders has prepared a report on pre-seed to Series A technology startups and VCs in 2023 across the Nordics (Denmark, Sweden, Norway, Finland, Iceland) and Baltics (Estonia, Latvia, Lithuania). AIN.Capital shares the keynotes on Finland and the Baltic region.

General state of the New Nordics in 2023

• In 2023, the early-stage funding in the New Nordics declined by only 9.7% from 2022 — with H2 funding up by 59%. Additionally, 22% increase in early-stage funding rounds in 2023 (196 compared to 161 rounds in 2022).
• Median round sizes remained stable across early-stage rounds with a slight decrease in the dispersion of round sizes compared to 2022.
• The most popular sector is energy and climate, with €195 million of invested capital, followed by fintech at €158 million, and digital health at €108 million.

• New Nordics remains an attractive investment location for non-New Nordic VCs and investors. It’s observed a modest increase in impact rounds, with about 29% of funding rounds (up from 26% last year) going to impact startups and 38% of invested capital.
• The average age of startups at the time of fundraising announcements significantly increased in 2023.

Finland and the Baltics

• Finland closed the biggest amount of rounds in 2023, getting the first place with 43 rounds, which amount to €197 million of invested capital.
• Estonia closed 30 rounds with the amount of €75 million of invested capital, followed be Lithuania — €45 million across 15 round, and Latvia — €9 million across 5 rounds.
• Invested capital per capita is significantly higher in Estonia (and Iceland) compared to other New Nordic countries, despite a sharp decline in invested capital from €155 million to €75 million.
• Average round sizes across pre-seed, seed & Series A are as follows: Finland — €7.9 million, Estonia — €3.7 million, Lithuania — €2.7 million, and Latvia — €1.8 million.

Countries highlights

In 2023, four new early-stage VC funds were launched in the New Nordics, with three out of four coming from Finland:

• Kvanted Ventures announced €70 million Nordic Industrial Technology Fund;
• Failup Ventures announced the first €30 million closing of its new early-stage fund of €50 million;
• Greencode Ventures launched €40 million fund to support green startups in Europe.

Finland’s Lifeline Ventures made the biggest amount of investments in 2023 — 9 new deals in total. While the most prominent funding rounds in 2023 were:

• Lithuania — Atrandi Biosciences raising €4.5 million in Series A funding.
• Latvia — Trace.Space securing $1.5 million for AI industrial software.
• Estonia — Arbonics attracting €5.5 million from investors during its seed round.
• Finland — ReOrbit raising $7.4 million in a seed round.