Since the establishment of Copenhagen Fintech, thousands of new jobs have been created in the Danish financial sector, and there is a strong appetite for investment. However, for this positive development to continue, careful nurturing of the fintech environment is required. This is the view of the new chairman of Copenhagen Fintech.
Steen Lund Olsen, Vice Chairman of the Financial Services Union Denmark (Finansforbundet), is the new chairman of Copenhagen Fintech. He has been passionate about the fintech environment since Copenhagen Fintech was founded in 2015 and is working to develop Copenhagen as one of the leading fintech hubs in the global financial services sector. This is achieved, among other things, through Copenhagen Fintech Lab, which houses several startups, the annual Nordic Fintech Week, and Copenhagen Fintech Policy, which engages in political advocacy for the fintech environment in Denmark.
“Copenhagen Fintech has achieved significant results in its relatively short existence through focused efforts to create growth and jobs in finance and technology in Denmark. It is thanks to strong collaboration across sectors that the fintech ecosystem has laid the foundation for an entirely new industry and a position of strength for Denmark. I am pleased and proud to lead this effort, and I will work purposefully to further strengthen our potential together,” says Steen Lund Olsen.
“The future will feature an interplay of many different technologies, and the companies that master this discipline will be the winners. Artificial intelligence will play a significant role in the future fintech environment, but it is important that we use the technology prudently and seriously to maintain trust in the digital society.”
Steen Lund Olsen,
Chairman of Copenhagen Fintech
The growth layer should be strengthened
However, he is well aware that growth does not come without limits, and he has previously argued that distorted competition is slowing the international growth of the Danish fintech environment. Fundamentally, the Danish fintech environment is thriving, with innovation and creativity creating many new and exciting companies, but outdated legislation hinders opportunities for expansion – not just in Denmark but also globally.
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“The growth layer for Danish fintech is not just sprouting; it has truly taken root, so now it’s about creating optimal conditions to strengthen it. Not just nationally, but also in relation to competition from abroad. We have a huge potential, and it would be a shame if it, so to speak, should slip through our fingers,” explains Steen Lund Olsen. By this, he means there is a risk that foreign investments from, for example, the USA and China will make it more attractive for startups to relocate rather than stay in Denmark.
Investment interest must be nurtured
“If you establish a startup in the fintech sector, you are almost immediately subject to the Financial Business Act. This imposes a number of legal challenges that can be difficult to meet and, all else being equal, can make it hard to attract interested investors. Compared to the EU, markets like the U.S. and Asia are much easier to operate in, which naturally increases investment willingness,” says Steen Lund Olsen.
Since the establishment of Copenhagen Fintech, around 4,300 new jobs have been created in this part of the financial sector, and a study by the analysis firm Genome shows that Danish startups raised the third most venture capital per capita among the 120 leading European ecosystems in 2023. Of this, the fintech environment represents 32% of investments. Steen Lund Olsen believes it would be a shame to throw away this positive trend due to rigid legislation and heavy legal burdens.
Better cooperation with authorities
“I am well aware that it is a balancing act because we must not compromise on all laws and regulations, but in my view, there should be an opportunity for startups in the fintech environment to cautiously get started and be allowed to test their business ideas and concepts, for example, in a closed sandbox environment. Preferably in cooperation with the authorities. Too many of the new companies struggle with the rules, and I think it’s a shame when, from a business policy standpoint, Danish fintech is specifically highlighted as a position of strength,” elaborates Steen Lund Olsen.
He calls for better and, not least, continuous cooperation with the authorities. In his view, this is in society’s interest, as it ultimately concerns creating and, importantly, maintaining jobs in Denmark, which is one of the reasons why the Financial Services Union Denmark has entered into a framework agreement with the Employers’ Association for Fintech in Denmark. The new chairman of Copenhagen Fintech sees the potential for good interaction between startups, the established financial sector, and the Financial Services Union Denmark as an organization.
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Staying ahead of development
“We must stay ahead of where the industry is heading and what new competency requirements our members will face in the future, just as we must keep a close eye on the new technologies the industry adopts. Therefore, it is only natural that we need to take advantage of an organized labour market and the corporation between employers and employee. That is a valuable Danish trademark, which is why we place great importance on the Employers’ Association for Fintech, as well as the collective bargaining agreement between the association and Financial Services Union Denmark,” says Steen Lund Olsen, for whom another area of focus is how to help the fintech environment attract capital, partly through foundation work.
The desire for innovation in the sector is strong, and the new chairman is pleased to note that the previous mindset – that if you tried a business idea and failed, you were pretty much out – has changed. Today, the attitude is different, similar to the tech environment in Silicon Valley for decades, meaning that one or two failures are not an obstacle to later success and certainly not something to look down on. You learn from both the projects that succeed and those that don’t.
