As Sweden’s second largest city, Gothenburg stands out for its sustainability credentials, entrepreneurial ethos and ability to cultivate innovation. It also serves as headquarters for global organizations like Volvo, Polestar, AstraZeneca and Ericsson.
In October, Gothenburg was ranked second of 40 countries by the Global Destination Sustainability Index for its approach to tourism, social inclusion, supply chain due diligence and environmental performance.
But beyond the city’s green credentials, is a unique landscape made up of investors, innovators, scientists and companies helping to buck the trend of the challenging funding landscape in the climate and wider green tech space.
Research by PwC assessed that global investment flows into climate tech financing dropped by 29% from $79 billion to $56 billion from the end of 2022 to the end of 2023. The firm also recorded a contraction of climate tech funding from venture capital and private equity investment from 9.9% to 8.3% within the same timeframe.
Yet, amid this tough climate, Sweden ranked as the fourth country for climate tech funding in 2023 behind the U.S., China and the U.K., according to dealroom. This is unsurprising, given that it was the first country to pass an Environmental Protection Act back in 1967 and currently ranks sixth in the global Environmental Performance Index.
Gothenburg – A Place to Convene, Collaborate and Dream
To unpick who are the important stakeholders which make up this ecosystem of innovation and to better understand how investors are collaborating with businesses in Gothenburg, I spoke with Sofia Hjelmberg. Hjelmberg leads investor relations for GU Ventures, a fund focused on building ideas within the realm of tech and life sciences. She is also in charge of organizing GoWest, a flagship annual venture capital forum held in the city that convenes investors, startups and scale ups. GoWest is set to be held at the Karlatornet, the tallest building in the Nordics later in January.
“At times like these, connection is essential.” Hjelmberg said in an interview. “The core purpose of GoWest is to facilitate matchmaking at different levels and to bring projects and ideas to the Gothenburg ecosystem. This is comprised of Chalmers University, the private sector with companies like Volvo and the public sector including EIT, the EU innovation body.” she said.
Sessions centered around climate at GoWest will explore how to drive impact through investment, what climate tech looks like in a Trump world, plus an unveiling of a new Swedish climate startup map for 2025 by Swedish Incubators and Science Parks.
“Sustainability is high on the agenda for everyone, especially the politicians. Change comes from the top, but it’s the industry who facilitates it.” she added.
Hjelmburg observed why the city is ranked so highly for its approach to sustainability, “In Gothenburg, people are masters of collaborating, everyone is a phone call way. We understand that if we all pitch in, we will get the right exposure and partnerships going given the presence of the automotive industries and life sciences.”
Incubating and Funding Sustainable Solutions
Ann-Sofie Ekberg, CEO of Volvo Cars TechFund, attested to the importance of events like GoWest to congregate and convene minds to solve some critical challenges across deep-tech, life sciences and sustainability.
Based out of Gothenburg, Volvo Cars TechFund makes strategic investments and provides global market access for innovative ideas in the mobility and tech sectors. Since its inception in 2018, the fund has made 21 investments, typically in Series A or B funding rounds with a value of between €1 million to €5 million.
In our conversation, Ekberg shared more about the fund’s current portfolio which is tied to three key pillars of Volvo’s wider mission: personal, sustainable and safe mobility. This ranges from Dcbel, a company focused on home energy charging and Luminar which is innovating around high-performance light sensors for vehicles. The portfolio also includes Syre, a company with ambitions to scale textile to textile recycling, which raised $100 million in a Series A investment round last year.
“One of our most exciting investments in 2023 was into a British company, Breathe. It helps Volvo with faster charging software and battery optimization.” Ekberg said. There are multiple companies within the portfolio that demonstrate how the fund is scaling ideas to support the wider energy transition.
Ekberg and her team are actively engaged with portfolio companies. She detailed the their role, involving coaching and development until a given company is mature enough to receive request for quotes and to work independently alongside Volvo’s engineering and procurement teams.
“Over the lifetime of a company, we keep our ownership hat on, sitting with the boards of these startups and scale ups to ensure they have everything to support their growth and financial performance.” Ekberg commented.
On Gothenburg, I asked Ekberg what makes the city unique. “As part of the ecosystem, at Volvo Cars we want to drive that our home base is innovative and sustainable. Plus, by partnering with GoWest, we can share how we are an investment body too to encourage more funding and founding of ideas in the region.”
An Ecosystem of Ideas Rooted in Education
In addition to being home to the headquarters of Volvo, AstraZeneca and Ericsson, Gothenburg is home to Chalmers University of Technology. In our conversation, Hjelmburg highlighted how the work of GU Ventures and GoWest is shaped by developments at the University and how that might fit into the value chain of global companies in the area, particularly where science and engineering are concerned.
One thing that emanates from my interviews with the city’s multiple founders is that Gothenburg is a place that births and breeds ideas.
A prime example is Vividye, a company serving both the textile and cosmetic industries with its technology that can eliminate harmful chemicals and microplastics from color production processes.
Both co-founders of Vividye, Johanna Nissén Karlsson and Gustav Larsson are alumni of Chalmers University. “Gothenburg has multiple initiatives that encourage innovation and everyone is really engaged.” Larsson told me. “For Vividye, we need expertise in surface chemistry, plus research and development and there are many good chemists in Sweden.” he said.
Elsewhere, another graduate of Chalmers University is Syre’s CEO Dennis Nobelius, who grew up in Gothenburg. I wanted to get his take on the city, “It’s an inherent part of Scandinavian culture to be sustainable.” he said.
“It’s easy to start something in Gothenburg. People are interested, people are connected and people are used to working across companies and across industries.” Nobelius observed.
Anders Breitholtz, founder of Papershell, an organisation advancing material innovation and transforming paper into cellulose components for biogenic products echoed Nobelius’s thoughts in a conversation with me. “Gothenburg is a place where scientists and artists cross pollinate and super position their knowledge to create solutions.” he said. “It’s the solution orientated mentality of many players in the city that help each other succeed.” Breitholtz added.
Ultimately, it is this mentality Breitholz references, brought together by academics, global corporations, investors and entrepreneurs that has created an environment where ideas conceived to solve environmental and social challenges can thrive.
