The co-founder and managing director of the new business accelerator of the Norrsken Foundation in Sweden on attracting foodtech start-ups with impact as an integral part of their businesses
By Murielle Gonzalez
Funda Sezgi lived in Melbourne, Lund, Barcelona, Seville and San Francisco before moving to Stockholm where she built a career at Norrsken, the foundation founded by fintech entrepreneur and Klarna co-founder Niklas Adalberth in 2016. She joined the organisation three years ago, and this month her work made headlines with the launch of Norrsken Impact Accelerator. Sezgi co-founded the initiative and became its managing director.
Sezgi tells me that Sweden is heaven for tech entrepreneurs. She argues the country offers infrastructure support for companies at all stages, and that it’s no surprise Stockholm is mentioned among the cities producing the highest number of unicorns per capita, alongside Silicon Valley, Tel Aviv, and Singapore. Foodtech Oatly, battery maker Northvolt, and music streaming service Spotify are among the world’s top tech-driven unicorns to hail from Sweden.
Norrsken Impact Accelerator builds on this heritage and seeks to attract start-ups the world over to Sweden for an eight-week sprint guided by top-class mentors and the chance to pitch their business in front of 100 investors. The accelerator will give $100,000 in upfront pre-seed investment for 5% equity. With applications closing on 28 February, Norrsken will select 20 early-stage businesses to the accelerator programme scheduled to begin in July.
“Our goal is to find the next generation unicorns with impact fully integrated into their business models,” says Sezgi. She notes the focus is on investing in start-ups that can become highly profitable businesses and able to roll out their solutions globally.
She argues that when impact is integral to the business model, an extra unit of revenue generates additional impact. “As the company grows, so does its impact,” she says. “And if the business becomes a unicorn, its impact will be massive.” Sezgi explains that the aim is to increase the selected start-ups’ access to capital so that they can build scalable companies.
The accelerator seeks to support start-ups that leverage technology to create and scale innovative solutions to new and old societal and environmental challenges, but it highlighted foodtech as a clear focus area.
Sezgi explains that Norrsken has brought extra expertise on-board to provide support in this arena. “Three of four venture partners are foodtech-focused, and they jointly have extensive network and field knowledge enabling us to gear the programme in the right direction and identify promising entrepreneurial solutions from around the world.” Björn öste, co-founder of Oatly and entrepreneur, venture capital investor and vegan advocate Ryan Bethencourt are among them.
Impact: The good, the bad, and the urgency
Impact has become a keyword in the investment community. Sezgi brings up data from the 2019 report of the Global Impact Investing Network to highlight that impact investing has doubled in size the past two years. “Big money is also moving towards ESG investments, which have more than tripled over eight years and reached $40 trillion in total asset value in 2020,” she says.
Sezgi also notes that a growing number of companies and large corporations are adopting the UN’s Sustainable Development Goals and incorporating environmentally friendly solutions into their business activities.
“Consumers are increasingly taking responsibility for their actions and demand options that enable them to make sustainable choices,” she says. “Impact investing is still a niche but it’s growing at a rapid pace. The positive change is happening, and it got accelerated with the changes brought about by Covid-19 to our lives.”
Sezgi is quick to clarify that the question that puts pressure on impact investing is whether the change is fast enough and whether actions are taken at the scale needed to continue the economic progress, but in an environmentally friendly and socially sustainable way. “We still act as if we have time, but we really don’t,” she says. “Climate crisis, for instance, is so vast, so complex that if we reach the tipping point, we might not be able to turn things around.”
Sezgi continues: “The earth’s average temperature is expected to rise 1.5 degrees Celsius above the pre-industrial levels within the next 10 to 40 years. If we fail to control the situation before then, millions of people will most likely be in life-threatening situations, and we will most likely not have the tools to reverse it. That’s why we need to take action now and collectively.”
She argues the feeling of urgency is not there yet and what we are currently doing is not good enough. “In addition to the lack of action, there are the counter forces that deny scientific facts and affect public perception for their own gains and to avoid their responsibilities,” she says.
On the positive front, Sezgi believes the focus should be on optimism and innovation. “We need to believe in what we can achieve, and focus our efforts on solving problems that matter,” she says. “The world’s greatest challenges are also some of the greatest business opportunities. Tomorrow’s unicorns will be built on solutions to these challenges.”
The Norrsken Impact Accelerator is the foundation’s third business unit and joins venture capital firm Norrsken VC and Norrsken House in Stockholm, where the accelerator programme will take place this summer. A 2,400 square metre building, Norssken House provides co-working space to start-ups and organisations with impact.
To the point
You sat on the advisory board and were mentor at Bloomer’s accelerator, an initiative that focused on foodtech in partnership with Norrsken Foundation. What insights are you taking into the accelerator?
Foodtech has been a key impact area that emerged organically over time within different parts of Norrsken. Norrsken VC has made 21 investments, and seven have a foodtech or agtech focus.
Norrsken House Stockholm has a stable member base focused on foodtech, and we have a growing ecosystem of support to enable foodtech solutions. Bloomer accelerator gave us further exposure to many fantastic early-stage solutions to the food problem. Some of the emerging trends I can mention are new sources of protein, personalised diets and waste reduction.
On the more practical side, with learnings from Bloomer and based on further discussions with entrepreneurs, we decided to make Norrsken Impact Accelerator fully tailor-made to the needs of the entrepreneurs. We don’t think a fixed curriculum works – it’s too general and wastes precious time. The entrepreneurs will get the advice they need based on their demands.
What makes the Norrsken Impact Accelerator special?
What makes Norrsken Impact Accelerator a unique set up is the brilliant people that gathered around this initiative. We have carefully curated an amazing group of people with an exceptional entrepreneurial track record – people who have been in the trenches themselves. They have gone through all the blood, sweat and tears involved in raising hundreds of millions and building successful businesses that employ thousands of people.
Among them are more than 50 founders or unicorns and companies such as Klarna, Minecraft, Soundcloud, Good American, Meltwater and Brilliant Minds. These are the people we look up to and get inspired by every day.
Essentially, one can say that we’re really building the support we wished we had ourselves! We feel there is an immense value in assembling entrepreneurs around such a short sprint and channelling our joint resources and time towards selected entrepreneurs.
There is an incredible momentum for supporting the next-generation impact entrepreneurs, triggering a positive change in society and the planet.
How will you determine the impact of the start-ups applying for a spot in the accelerator?
We support companies that generate a positive impact as an integrated part of their business model. As the business grows, so too does its impact. To evaluate the impact, we assess the problem the start-up is trying to solve, its beneficiaries, how well the product addresses the problem, and the unintended consequences that would negatively affect the outcome.
You can only do so much within an eight-week programme, so how deep will the accelerator go?
During the eight-week sprint, the entrepreneurs will stay focused on their own customers and products. There will be minimal distraction and full support from successful entrepreneurs and world-class advisors.
The participants will also learn from each other through facilitated peer-to-peer interactions. In the last week, they’ll attend the Investor Demo Day to meet investors and, if relevant, potential customers.
We are also planning an epic final celebration. After this, the start-ups will remain part of our alumni network for life and will have the ability to reach out to peers, future participants, mentors and advisors. We aim to create circularity and work with the programme alumni to support the upcoming batches.
As the conversation nears the end, I have no doubt that Norrsken House in Stockholm will rise to the challenge and host, Covid-19 permitting, a one-of-a-kind accelerator experience for everyone involved. “We see great solutions emerging and hope the ambition level will keep increasing. With more successful entrepreneurs joining the foodtech movement, such as Erik Byrenius of OnlinePizza, I think we’re moving in the right direction,” Sezgi concludes.
Date published: 28 January 2021