Innovation: services and business ideas, or just tech?

Good interview. I agree with everything you said and much of what E.J. Penttilä said.

Further, I believe that your take on the potential of service innovations for Finland and Finnish startups is spot on.

When one follows everything that goes on over at the Silicon Valley one easily gets the idea that it's sexy web 2.0 apps or nothing. And sexy they are. But many times innovative service models that fill a void in the market, capitalize on a change in the society's fabric or just brake an age old tabu in how things 'should be run' are much more profitable and can create much more value to everyone.

I believe that we, the Finns, are somewhat better equipped in creating service businesses even if mostly traditional ones. Helsinki is the promised land of agencies at least compared to startups that have a product to sell.

Thus, I believe that there exists a historical path dependency and subsequent culture that makes it easier for us to create profitable business models around services than profitable scalable products in the traditional sense of the word. This has much to do with the fact that with services one is not depended on risk capital for building your business since one can many times do client work right from the get-go. This becomes a major issue in a country with no real venture capital ecosystem. Therefore, since we have the tradition and examples, only thing limiting our potential is our own thinking.

We need to free our thinking from the 'marketing agency' level and think in the we-will-make-a-multi-million-dollar-business-in-two-years frequency.

A good example is Igglo. To all its short comings, they did try and gave it their 100%. If you want to have big upsides, you need to accept that there will also be risks proportional to that. Sometimes these risk materialize as happened in Igglo's case, but I applaud that they tried. Now they only need to try once more. If that one won't fly, they need to try again, until they succeed.

The only way to increase the number of success stories is to increase the number of attempts to build those success stories. Equally importantly, the only way to build multi-million-euro success stories is to set your thinking on the multi-million-euro level when building the business model. It is very rare that one builds a big and successful business accidently.

Examples that I've heard about that might have the right ingredients (solid service model & big thinking) include Tweehouse and FWR Helsinki. I can only hope these will be hugely successful and that there will be a lot more to come.

This is not to say we should not try building successful product, but rather to say that eager young guns should not limit their thinking based on what they hear from the Silicon Valley or read from their Twitter. Opportunities are everywhere.

Thanks for the smart comments. Adds to the substance. Agree on companies like FWD Helsinki and also Laundy. I'm sure there are others around.