Alistair Houghton reports from Helsinki on Liverpool Vision’s bid to attract hi-tech investors

STEVE SMITH has a vision – to create a conveyor belt of hi-tech businesses from Finland to Merseyside.

It sounds ambitious, but, behind the scenes, work is well under way to build links between Liverpool and Finland and bring much-needed IT investment into the North West.

And LDP Business visited the Finnish capital Helsinki last week with Mr Smith, Liverpool Vision’s industry director for the digital sector, to see that activity at first hand.

There are many hi-tech entrepreneurs in Finland, the country that spawned Nokia and which is seen as one of the world’s hi-tech hubs.

But because Finland is such a small market, those firms need to expand internationally at an early stage if they are to keep growing.

The Finnish government is keen to create what Mr Smith calls “a conveyor belt of companies” expanding beyond Finland into the rest of Europe.

The UK is an obvious target market, thanks to its large advertising and design sector. And that presents agency Liverpool with an opportunity.

Mr Smith runs Liverpool Software City, the annual digital showcase where hi-tech companies pitch to a panel of investors. But Software City is now about more than just one showcase – it is instead the brand name for a rolling programme of events to attract investment to the city.

Mr Smith is focusing on attracting investment from two regions –California’s Silicon Valley, and Finland.

Last month he visited Silicon Valley to choose two US firms to pitch at Software City on November 25.

And last week he visited Finland for a pitching session to choose two Finnish firms to pitch in Liverpool – Steam Republic and Tribe Studios.

Mr Smith organised the event alongside Culminatum, the Finnish government agency that promotes the country’s high-tech sector. Working with Culminatum cuts the cost for Liverpool Vision, while maximising attendance from Finnish firms.

Mr Smith has been working in Finland for four years, and has already attracted one business to Merseyside. LDP Business revealed this month that Hammerkit, which has developed an online software package to help people design websites, is to open an office in Liverpool.

Hammerkit’s managing director Mark Sorsa-Leslie was among a group of entrepreneurs brought to Liverpool early this year to see the region’s digital sector for themselves.

In his introduction to Thursday evening’s event, Smith called the North West the “second largest digital economy in Europe and the biggest games cluster in Europe”.

He believes that Liverpool is a better place for young Finnish companies to base themselves than London, where they would be lost in the crowd.

And, sitting in the Helsinki offices of state-backed venture capital company Finnvera, he said he believed more companies would follow Hammerkit’s lead. “When I originally conceived this project, I didn’t realise it would work as well as this,” he said.

“My plan was to bring two or three companies a year to Liverpool. I think the prospect now could be four or five.

“Mark Sorsa-Leslie will be a ratepayer in Liverpool. He’ll be looking to recruit people on good salaries – it’s very white-collar work. It’s a knowledge economy proposition.

“What are the incidental effects? These guys have to live somewhere. They’ll need legal and accountancy services. It all has this ripple effect.”

On Wednesday, Smith held an Academy Day to help those attending Thursday’s session to perfect their pitches.

He was joined by serial entrepreneur Taneli Tikka and Mikko-Jussi Suonenlahti of Veraventure.

Smith was clearly delighted that Mr Tikka could join his panel. Mr Tikka is one of Finland’s best-known technology entrepreneurs, and was even approached to star in the Finnish version of The Bachelor, the reality show that sees women compete for the attentions of a wealthy suitor.

On Thursday, Mr Smith based himself in a small brick-vaulted office beneath Finnvera’s home, a short walk from Helsinki’s landmark cathedral, and settled in for a day of meetings.

He spoke to Hannu Jungman, manager at state-backed venture capital investor VeraVenture, to finalise arrangements for the evening event.

“VeraVenture is the investor in a lot of these businesses,” said Mr Smith.

“They back businesses that from day one should be global. The idea is to help them expand out of Finland early. The UK is their number one market.”

Mr Jungman said Finnish companies had to expand abroad at an early stage in their development.

“The key thing is that the home market is so tiny,” he said. “From day one, if you want to grow to a significant level, you have to grow out of Finland. Most Finns speak relatively good English, so an obvious choice is to go to the UK.”

Mr Smith also met entrepreneurs from other young Finnish firms who were not pitching at the evening event, but who may one day want to invest in the UK.

Those entrepreneurs included the ebullient Juha Keski-Nisula, of XMLdation, who believes his security testing software has the potential to become a world leader. Now he is on the hunt for the investment he needs to make that happen.

“We’ve got money enough to be here in Finland,” he said. “But we want to go global. “

Next came the big event – Thursday evening’s pitching session.

The first company to present was Steam Republic, led by its enthusiastic “trade minister” Paavo Bäckman.

It specialises in “direct to fan marketing and sales tools”, under the brand Mobile Backstage, which brings artists closer to their fans and provide opportunities to sell merchandising and concert tickets.

It creates apps fans can download to their mobile phones, through which fans can find out more about their musical idols and buy products and tickets.

Steam Republic has already worked with artists from UK rapper Dizzee Rascal to rockers You Me At Six, and is now keen to break into the US market. Bäckman said that creating dedicated apps worked because existing social networks, from MySpace to Twitter were simply too “noisy” with thousands of artists and millions of fans talking at each other.

“How can you engage with audiences when there are thousands of people shouting all the time?” asked Bäckman.

“My solution is to create an undisturbed ground for your tribe to offer something special for your fans.

“Mobile Backstage creates a direct connection between the artists and the fans in a de-noised, dedicated and branded mobile environment.”

Elina Arponen, “chieftain” of Tribe Studios, won her place at Liverpool Software City with a bold statement – “We create the greatest computer games that you can enjoy in one evening.”

Tribe creates Stagecraft multiplayer games that can be completed at one sitting. They are designed for people who may not have the time to keep up with all the latest releases, but still want to play video games occasionally with friends.

“I love computer games,” said Ms Arponen. “I grew up with Nintendo and Sega Megadrive consoles.

“I would very much love to play all the new games that come out.

“But there’s a problem. I have a kid, a job and a life. I’m too busy.

“I’m not the only one. The average age of a gamer is 32. There’s a lot of people with their busy careers who’d like to play quality games but don’t have the chance. So we’re bringing them one-night games.”

Tribe is now looking for money to accelerate its growth and to help it sell overseas.

“Since our games are in English, it makes us instantly global,” she said.

Mark Sorsa-Leslie, of Hammerkit, also spoke at Thursday’s event.

He said his company’s software could “revolutionise” the web design industry by making it easier for companies to create websites and said he believed the company was well placed to break into new markets,

“We want to be the infrastructure that powers the web design industry,” he said.

Hammerkit is ambitious and in Liverpool – and Mr Smith firmly believes more companies like it are on their way to Merseyside.

So his work with Finland won’t stop in November. Next year, Mr Smith will bring another group of Finnish chief executives to the region.

He said: “Rather than trying to sell the region through Power Point, I’m trying to bring CEOs of aspirational businesses to the region to view the landscape and make their own minds up.”

And there are sure to be more visits to Finland to come as Mr Smith bids to keep the Finnish conveyor belt rolling into Merseyside.

“The idea is that each visit becomes more significant than the previous one,” he said. “It’s beginning to snowball. My contact base in Finland is now telling me about companies that have the potential to come to the North West.

“I can keep talking to them and keep those leads warm.”