A new Nordic analysis model seeks to build the Nordic region as the strongest impact startup ecosystem by breaking down public procurement barriers.
The sustainability of the public sector’s welfare services is threatened due to factors such as a rapidly growing group of elderly and fewer active taxpayers. This means that we need to develop new solutions, specifically solutions that create measurable social effects. Impact startups are important drivers for social innovation because they measure their success on both societal and economic results. There are however existing barriers that prevent them from accessing the public sector market.
Every year, the Nordic public sector (ex. Iceland) purchases goods and services for approx. € 213 billion. A significant amount of this budget goes to different aspects of social welfare. However, tenders and quotations traditionally point in the direction of larger well-established companies and not startups. One of the biggest barriers is the lack of access to the public market which makes sales to the public sector seem to be the most expensive and difficult ones. If selling to the primary customer (BtG) is considered difficult or impossible, it will naturally affect investors' desire to invest, and hence limits growth potential for the startups.
We want to unite knowledge, financing, innovative solutions and public procurement. Therefore, Nordic Innovation and Impact StartUp Nordic have collaborated to investigate and develop 3 essential themes in relation to building the Nordic region as the strongest impact startups ecosystem.
We need to understand why it is so hard for impact startups to break through the public procurement wall. We also need to empower public procurement towards procuring for societal impact and increase procurement from innovative impact startups. And we need to show the way for matching innovative solutions with public procurement through e.g., co-creations and social outcome contracts.
To understand, empower and show the way, we are working with desk research in order to provide an in-depth analysis of the impact ecosystem. Through an in-depth qualitative and quantitative analysis, we will generate new knowledge and thus create valuable insights for the entire Nordic ecosystem from:
The analysis will be conducted in Denmark, Norway, Sweden and Finland. The findings will be used for developing content for the pilot cases, where public procurement is empowered and matched with relevant solutions from impact startups. Based on new insights, we will be able to generate awareness of the reasons why impact potential is not realized by public procurement today.
The end goal is to conduct 2-3 national co-creation labs between startups and the public sector, serving as models and reference cases for further scaling.