Healthcare technology growth companies and start-ups meet investors at Finlandia Hall
Press release 3.9.2013
Healthcare technology is a growing industry which offers good employment prospects in Finland. Veli Mäkelä, Chairman of FiHTA emphasizes that steps need to be taken in order to make sure that the excellent growth enjoyed for the last two decades can continue. In particular, the industry would benefit from new funding mechanisms to help boost the growth of smaller companies.
Healthtech is growing while most other industries in Finland are declining. Last year, exports grew by 22.8% to €1.65 billion and Finland’s already sizable trade balance in healthtech grew an astounding 44%. It is notable that this positive news represents a much longer-term trend. On average, the healthtech industry has grown approximately 10% annually for two decades – making health technology the second largest contributor to Finland’s hi-tech exports. According to Mäkelä, this growth looks set to continue – but largely due only to the continued success of a small number of large companies.
Although new companies are being founded on a regular basis, in part with the help of R&D funding by the Finnish Funding Agency for Technology and Innovation (Tekes), they are not experiencing the same kind of growth. “Now we need to make sure that the R&D investments made in small companies are recouped through global product commercialization. Our industry features very close links between manufacturing and R&D. As soon as these small companies start to grow, they will be boosting Finland’s exports. However, compared to other technology industries the time to market is exceptionally long in healthcare. FiHTA is therefore actively campaigning for new funding solutions at a national level in order to help solve the commercialization bottle-neck.”
The latest financing effort by the industry is the MedTech Nordic Investing & Partnering event to be held in Helsinki on September 3rd, 2013. Thirty start-ups and growth-orientated companies will have the chance to meet with potential healthtech investors.
According to Mäkelä, healthcare technology is a good investment. “Investors in healthtech have the opportunity to make similar profits as in the biotech and pharmaceutical industries, but at a lower risk. Investors who have patience can be rewarded with good cash flows that last for years, even decades.”
Optomed Oy, a company which specializes in digital visual inspection instruments, has financed its growth by attracting both foreign and domestic investors. According to Seppo Kopsala, Managing Director of Optomed Oy, fund-raising requires a large effort. “You need to really spark potential investors’ interest in your story. In the start-up phase, 70% of a managing director’s time is spent on fund-raising – year after year. Discussions with investors can last up to two years, and out of 20 to 30 initial contacts a company may attract one or two new investors – if everything goes well.”
Micah Gland, Chief Executive Officer of Greater Helsinki Promotion Oy, says Finland is attracting a lot of interest from investors right now. For several years now, the Greater Helsinki region has seen more interest than the other Nordic capitals and foreign investment in the region’s growth companies has been on the increase. According to Gland, healthcare technology is clearly a sector investors have their sights on. In the last three years, the region has attracted more than ten healthtech investors from overseas.
Terhi Kajaste, Managing Director, Finnish Health Technology Association, FiHTA
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