Finland’s startup ecosystem is maturing: fewer new companies are founded, but the companies at the top are getting stronger

The study identified more than 4,000 startup-based companies, of which around 1,800 are early-stage startups. In 2024, the full company population employed more than 50,000 people worldwide and generated over EUR 13 billion in combined revenue.

Fewer new startups are being founded than before. In 2022–2023, an average of 260 new startups were registered per year, compared with an average of around 340 in 2015–2019. The pandemic years were an exception, with an exceptionally high number of new startups founded. The typical startup has also changed: it generates more revenue, and first-round teams are smaller than before.

“Finland’s startup ecosystem has taken a leap forward in growth. Especially deep tech has become the spearhead of the Finnish startup scene. Oura’s revenue already exceeds Wolt’s and Supercell’s revenue in their exit years, and this year’s IPOs – IQM, Sensofusion and Steady Energy – show that a deep tech company can grow into a listed company. Every such success story leads by example as well as attracts talent and capital,” says Henri Hakamo, Chief Strategy and Research Officer at Tesi.

The number of AI startups has grown rapidly. In 2020, only two per cent of new startups were AI companies, but according to preliminary data, the share had risen to around 14 per cent in 2025. Since 2020, roughly a hundred AI startups have been identified in Finland, most of them founded in 2023 or later. Most of them develop applications that utilise AI.

“The global rise of AI is also visible in Finland, and in startups, which are often the first to adopt new technology. After a slow start, the pace has picked up: already one in seven new startups is an AI company, and AI is core to the business of almost a third of scaleups. The new generation has the makings of international success stories,” says Hakamo.

Foreign investors take part in a growing share of funding rounds

Foreign investors are participating in Finnish startups’ funding rounds more often than before. In 2021–2026, a foreign investor took part in 60 per cent of second rounds, up from 25 per cent in 2010–2015. Participation has increased across all of the first three rounds, which suggests that foreign investors are joining at an earlier stage than before.

“The growing interest from foreign investors reflects the improving quality of Finnish startups. In the earliest stages, however, domestic capital still plays a decisive role: almost two in three first funding rounds are carried out by domestic investors alone,” says Jonne Kuittinen, Deputy CEO of the Finnish Venture Capital Association.

Around a third of new startups raise their first equity round within three years of founding. The number and size of early-stage investments have remained fairly stable in recent years.

Funding growth is concentrated in later-stage companies growing rapidly on an international scale, i.e. scaleups. According to preliminary data, scaleup funding rose to a record of over EUR 1.5 billion in 2025. Companies that have raised significant funding rounds include radar satellite manufacturer ICEYE and AI infrastructure technology company Verda.

Startup-based companies invest in R&D and have a diverse workforce

In 2024, startup-based companies spent nearly one billion euros on R&D, around one sixth of business-sector expenditure. Since 2015, the expenditure has grown by an average of 17 per cent a year. The biggest leap – by more than 30 per cent year on year – came in 2021.

“Finland aims to raise R&D expenditure to four per cent of GDP by 2030, with around two thirds of the target to be covered by private funding. R&D expenditure in startup-based companies has grown considerably faster than in the rest of the business sector in recent years, and they account for around one sixth compared to that of business-sector. For Finland’s renewal, it is crucial that research expertise is turned into products and business,” says Amir Hassan, Economist at the Finnish Startup Community.

The workforce of startups and scaleups has become more diverse. Women’s share of early-stage startup employees rose from 19 per cent to 30 per cent in 2015–2024. In scaleups, women account for 28 per cent of employees, in line with the ICT sector.

Employees with a foreign background make up around a fifth of early-stage startup employees and a third of scaleup employees.

In 2024, around 9,000 people worked in R&D roles in startup-based companies, of whom nearly a thousand were PhDs. The number of PhDs has nearly quadrupled since 2015, and their share of R&D personnel has risen to around 11 per cent.

“Startup-based companies are a growing pillar of the economy. They have also become a significant employer of highly educated talent and an attractive career path for PhDs. They attract researchers and experts both from Finland and internationally, and this is also reflected in the diverse backgrounds of their workforce,” says Hassan.

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