Posted by Jussi Autere:
It was announced today that Veritas Eläkevakuutus and Ingman Finance Oy have invested in a Finnish company M-Brain Oy. M-Brain is a business intelligence company monitoring and analyzing social and editorial media.
This is a sign of market development that we have seen also in our M&A and consulting projects. The area of demanding analysis of data has become a serious business with multiple successful start-ups even in Finland. Besides M-Brain one can mention, e .g. Kwantic and Analyse Solutions Finland. This development has partially changed the old wisdom that it is difficult to build good businesses based on mathematical or statistical algorithms.
There seems to be three reasons behind the development:
- The investments of corporations on data warehousing and business intelligence technologies have made finally the needed data available for analysis;
- The emergence of businesses, where success demands systematic analysis and understanding of masses of data, e. g. digital media;
- Most importantly: some of the experts in data analysis like M-Brain management have learnt that the crucial thing in business is to understand customer needs and build solutions that help customers to either generate more sales, higher prices, or reduce costs.
The last phenomenon is especially delighting, as it has been a typical problem for all the Finnish technology based start-up, not only those operating in the area of advanced analytics.
As the business originating from Finland is starting to boom, the next question is whether this area of competences would become an internationally growing industry for Finland. The answer is not straightforward. The majority of the successful companies have customer intimacy as their key resource. This makes it slow to expand to markets, in which the companies do not have yet customer relationships.
There are three ways to overcome this challenge:
- Just selling by self. This is the slow approach;
- Raising venture money to be able to recruit sales organization. There are plenty of challenges in this approach. People who have experience on building fast foreign sales organization are crucial for this approach to succeed;
- Finding partners that can help the companies to forge customer relationships. This is many times the most cost-efficient way, but Finns do not have a good track record on working with foreign partners.
As the crucial things facing the Finnish advanced analytics companies in their internationalizati0on approaches are similar like in many other industries, their success in going abroad will show whether we Finns have been able to learn from our experience, or not.