Good for a chuckle -
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The Smart Money Is
Backing Scandinavia
6/25/00 8:06 PM ET
What's new in the e-world? Not much.
Despite farewells to several U.K. market beginners, investment interest here in the
dot-com world continues to grow. Perhaps the overabundance of choice in the U.S.
enables European opportunities to come more sharply into focus.
There's no real shortage of venture capital available for new ideas, but the
importance of good management, financial controls and a firm market opportunity
have now made investors wary if these prerequisites are not already in place. The
venture capitalist wants to see a more positive future, but the dot-commer also
needs to be sure he's provided with more than just money.
It's known as "smart money," where the capitalist provides something extra:
introduction to strategic partners; opening doors that others cannot; helping to
develop marketing and the right story for investor relations -- all more important
than plain old-fashioned banking. Perhaps most importantly, the dot-coms need
advice on an exit IPO or trade sale. They want to know now, "Where do we go from
here?"
The U.S. ambassador to Britain, the Hon. Philip Lader, extremely well-versed in
business, gave a forthright review in a recent International Herald Tribune article.
While start-up companies are pulling ahead, he said, Old Economy companies
"are racing to devise ways to increase their escape velocity," moving to modernize
their performance. What goes around comes around.
Scandinavia never ceases to fascinate me, in particular Sweden, where the
example of Ericsson (ERICY:Nasdaq ADR - news - boards) has spawned a whole
new telecom industry. And would you believe Finland's Nokia (NOK:NYSE ADR -
news - boards) is now the largest company in Europe? Businesswise, who had
really heard of that country until recent years? But today, Scandinavian telcos'
research and development lead the world. Also, Nokia owns one of the most
sophisticated venture capital divisions anywhere. And where is that? Right ... in
California.
To generalize, Scandinavians are bright, well-educated people who pay little
attention to the past, love the challenge of something new, and are not content to
stay within the confines of their own borders or rely on the fame of their
world-beating tennis stars. A Swede, Johan Eliasch, incidentally an amateur
scratch golfer, owns one of the world's leading sports equipment companies,
Head. And where is that? In Austria. Head is at the forefront, for example, of
innovative tennis racquet design, which will probably change the international game
forever.
To talk to the chief executives of Scandinavia's leading companies is an exciting
experience and one that convinces me that these countries are going to continue
to grow in the big time. Look at the investment opportunities there and do some
research for yourself.
What's happened to the New Economy here in the four weeks since I last wrote?
Not a great deal that was unexpected in the fast-moving e-world. The operative
word for investors has been caution. Time spent in analysis is never wasted and
that's still the key to successful investment.
Some new e-comers have been dropped from the FTSE-100 (or Footsie) and some
old e-companies are back. Plus ca change, plus c'est la meme chose...
from Street.com |
