The number of successful startups from Aarhus as well as their impact is greater than ever. The ecosystem is rumbling all the way from its bottom and a wide range of stakeholders are adding to the momentum.
When Morten Sønderskov walked through the door to the Aarhus-based startup Lunar six years ago, he joined a team of only around 10 people who were tasked to work on the first version of a new banking app. But even though the startup had neither a finished product nor earnings, it was located at a prominent address near the port of Aarhus.
“From the beginning, it meant something to be in the heart of Aarhus. It was to dare, to bet big from the start – also on the location of the office – in order to show: We actually mean this, we want to build something big from Aarhus,” Sønderskov, COO in Lunar, remembers.
Since then, the team of 10 has grown to 600 employees, and the company has reached a valuation of more than DKK2 billion, making it the third unicorn born in Aarhus.
Even though the bank has also opened hubs in Copenhagen, Stockholm and Oslo along the way – and not least got Will Ferrell as an investor and advertising face – Lunar still employs 170 people in Aarhus, which is a central tech hub for the fast-paced unicorn.
“Our original home is Aarhus, and although we are also present in other cities now, there is no doubt that Aarhus is still in our DNA: Our culture is formed and carried by many of the first employees from the time in Aarhus,” Sønderskov says.
An ecosystem in the same direction
Lunar is the latest shooting star from Aarhus, but the city has previously fostered two more unicorns as well as a large number of other successful startups and leading startup communities since the turn of the millennium. Much of the development, however, has taken place in silos: the unifying factor has been missing. Which is precisely what the new organization The Link wants to accomplish.
“Aarhus is small enough for everyone to know each other. Yey, it’s big enough to make an impact. So we actually have potential here, and when we get people to run in the same direction, we can move a lot. That is why we are trying to connect the amazing fragments into a more unified ecosystem,” Mette Tønnesen, CEO of The Link, says.
Among other things, the organization is behind the ecosystem platform Startup Aarhus, the event Aarhus Townhall, which recently gathered 500 participants, and managed to lure the international startup summit Slush to the city with its satellite event Aarhus Slush’D this fall.
However, The Link does not do it alone. All efforts are made in collaboration with a large number of startups, corporates, investors, public agencies and knowledge institutions based on the thesis that the ecosystem can only raise the level of ambition, create better conditions and gain more international attention if they do it together.
Aarhus by the numbers:
- 3 Unicorns
- 7.600+ startups
- $530M invested
- #7 Global Innovation Index (Danmark)
Educations have changed
Shortly before The Link was founded, Aarhus University opened its new space for entrepreneurs, The Kitchen, and after just three years they have attracted 170 companies started by students and employees at the university. At the same time, VIA University College has decided that entrepreneurship should be a theme in all its programs. And according to Jeppe Dørup Olesen, head of The Kitchen, this paints a picture of the movement that is running through the city’s educational institutions.
“There is a big difference between how education contributed 10 years ago and what is happening today. Educational institutions have launched a wide range of initiatives to focus on startups and work seriously with entrepreneurship,” Dørup Olesen says.
This has made the path from student to founder of a startup more clear: The students are exposed to entrepreneurship in classes, and can afterwards visit The Kitchen to try out an idea. Once established, they can continue their journey in the city’s industry-specific innovation hubs. All this while having role models such as Lunar, Humio and Bright Star Studios, which have shown how big a startup can be in Aarhus in recent years.
“I think it is important to appreciate and embrace a great diversity in the ecosystem, so there are many paths to success. The more people who succeed, the more activity the ecosystem will become – as the successes pass on some of their resources and experiences. It is an important part of the ecosystem that there is always a next step that you can aim for as a startup,” Dørup says.
Student City Aarhus:
- Aarhus University is in the top 100 worldwide, but the university is just one among many educational institutions in Aarhus. VIA University College, Aarhus BSS, Arkitektskolen, Journalisthøjskolen, Det Jyske Musikkonservatorium and Erhvervsakademi Aarhus are just a few examples of the many opportunities in the city.
- The many students make Aarhus a young city. In fact, central Aarhus is the first major zip code in Denmark, where half of the inhabitants are young people in their 20s.
Source: Danmarks Statistik (POST1A) and DR.dk
The big ones and the small ones
Well-established IT companies such as Systematic, Designit, Trifork and Stibo have proven the innovative power of Aarhus for decades, and international giants such as Google and Uber also located some of their tech development in the capital of Jutland.
Still, both entrepreneurs and big businesses have looked past each other. But here, too, something new is happening: a network for large companies interested in investing in startups – so-called corporate venture capital – has seen the light of day. And this is good news for the young companies, which will get a better shot at claiming growth capital, industry-specific partnerships and collaboration with the corporates.
Large companies such as Grundfos, Arla and Aura have joined the network to share their experiences. And the latter has already set up Aura Ventures, where a double-digit million a year has been set aside to invest in startups:
“We want to be the obvious partner for startups, and finding our place in the ecosystem is a journey I look forward to. With our investments, we can help bring new solutions to the market. Together with good local players, we also hope to be able to help make Aarhus even more attractive for startups,” Martin Schorling Overgård, who heads Aura Ventures, says.
Positions of Strenght in Aarhus:
On 1 October 2020, Denmark’s 14 new business clusters were named. 8 of the 14 business clusters have a physical presence in Aarhus:
Clusters headquartered in Aarhus:
- Fødevarer & Bioressources: Food & Bio Cluster Denmark
- Digital teknologies: DigitalLead
Clusters with branches in Aarhus:
• Environment Technologies (CLEAN – Danmarks Miljøteknologiklynge), Energy technologies (Energy Cluster Denmark), Life science & healthtech (Life Science Cluster Denmark), Design, fashion & furniture (Lifestyle & Design Cluster), • Robot- and drone technology (Odense Robotics) and • Animation, games and movies (Vision Denmark)
“We are not at the finish line at all”
Across the board, the startup ecosystem in Aarhus has matured immensely over the past decade. Public as well as private actors are evolving and beginning to gather across traditional borders. And with its unicorn status, Lunar clearly shows that the city’s startups are on a different level than just a few years ago as well.
However, Lunar is far from the only new star in Aarhus: the fintech colleagues from Aiia have been sold to Mastercard for a triple-digit million amount, CrowdStrike has acquired the data startup Humio for DKK 2.4 billion, and the gaming sensation Bright Star Studio has received pre-orders for more than a billion kroner.
“There are still many tech companies on the rise in Aarhus – for better or worse. And when I say worse, it’s mostly because the competition to attract tech talent in Aarhus is at its maximum,” Morten Sønderskov from Lunar says with a laugh.
10 years ago, it was common startup wisdom that you should move to Copenhagen, London or Silicon Valley as soon as possible if you wanted to make it big. But when Sønderskov looks back, it made sense for Lunar to root itself in Aarhus and grow from here.
“There is nothing that indicates that we would be more successful by moving everything to Copenhagen or other cities – on the contrary. Today, it is a great strength that we are represented in our hubs across Denmark, Norway and Sweden, so we can attract new talent everywhere,” Sønderskov says.
And perhaps it is also the Jutlandic roots that show themselves in his reluctance to acknowledge the new unicorn’s significance for self-understanding in the Aarhus ecosystem.
“We have come a long way, and from the outside, it can be exciting and inspiring to look at from the outside. But when you are deep inside it, you just see a new day with new challenges in front of you. That’s just what we need to do. We have come a long way – but we are not at the finish line at all.”