Norway as a destination for tech founders(forbes.com)
forbes.com
Norway as a destination for tech founders
https://www.forbes.com/sites/lawrencewintermeyer/2018/01/19/norway-calling-all-us-and-uk-tech-hipsters/#39a2d89158fb
75 comments
I don't think Norway ends up more expensive than SF or Manhattan for most people. Yes, petty expenses like buying beer in a pub are high, but the really big expense for most people, rent, is far lower. You can get a nice, modern, centrally located apartment in Oslo, without roommates or rats, for $1300-1500/mo ($10-12k NOK). And you can get it down to more like $1000/mo ($8k NOK) if you're willing to commute a bit. Try getting something with that budget in SF or Manhattan!
Taxes are high, but for entrepreneurs that's largely offset by: 1) no self-employment payroll taxes, and 2) your taxes cover your full health insurance costs. Once you add in the U.S.'s 15% payroll tax and health-insurance premiums you don't really save much in many scenarios.
Taxes are high, but for entrepreneurs that's largely offset by: 1) no self-employment payroll taxes, and 2) your taxes cover your full health insurance costs. Once you add in the U.S.'s 15% payroll tax and health-insurance premiums you don't really save much in many scenarios.
The way I always put it is that it's better to be rich in America, but most definitely, inarguably better to be poor in Norway, by almost every metric.
Scandinavia is great if you are rich. Sweden for instance would be a great choice for anyone with a trust fund. You would have to pay almost no taxes and still get all the services. It is becoming rich that is hard. Though you could argue that a lot more people get the chance. The problem is that it has also become increasingly hard to be frugal. Especially when it comes to cost of housing, but also the cost of a good quality of life in general.
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Most entrepreneurs are after capital gains, not salary. The 24% rate seems acceptable, however, the wealth tax that then follows will force most successful entrepreneurs out of the country once they've made their fortune.
That said, how much is an "average" salary?
That said, how much is an "average" salary?
For 2016, the overall average salary in Norway was about 5500 USD per month.
Source: https://www.ssb.no/en/arbeid-og-lonn/statistikker/lonnansatt...
Source: https://www.ssb.no/en/arbeid-og-lonn/statistikker/lonnansatt...
> Norway is the most expensive country i have ever lived in or visited
I visited Scandinavia (Bergen was one of my stops) a couple of summers back, and between the currency conversion and prices it was easily the most expensive place I have ever been. It's an amazingly beautiful area, but I doubt I'll ever go back because of the prices.
I remember sitting in a restaurant in Stockholm and commenting that maybe the prices would go down some in Norway, and a couple next to us started laughing. The other couple then explained not only were they not going down, but they are going up.
I visited Scandinavia (Bergen was one of my stops) a couple of summers back, and between the currency conversion and prices it was easily the most expensive place I have ever been. It's an amazingly beautiful area, but I doubt I'll ever go back because of the prices.
I remember sitting in a restaurant in Stockholm and commenting that maybe the prices would go down some in Norway, and a couple next to us started laughing. The other couple then explained not only were they not going down, but they are going up.
Yup, I live in Stockholm and almost wherever I travel I feel my money is worth more than at home (that includes cities like Amsterdam, Munich, etc., so quite expensive places), the only exceptions have been Oslo and anywhere in Switzerland. My gosh, it hurt a bit paying for €8-10 shitty beers or €6 cappuccinos at the train stations.
Tokyo is or can be significantly less expensive. It's just that you'll live in a smaller apartment of lower standard.
Less English speaking in Japan, and a lower quality of life generally.
> lower quality of life generally
The quality of life in Tokyo can be quite extraordinary, depending on your point of view.
As a westerner imitating the salaryman lifestyle? Absolutely terrible, primarily for work-related reasons.
As a westerner doing basically anything else that doesn't involve employment at a massive Japanese conglomerate? Excellent.
If you can deal with the lack of English and gain some modicum of comfort with Japanese culture, it's a fantastic place to live.
The quality of life in Tokyo can be quite extraordinary, depending on your point of view.
As a westerner imitating the salaryman lifestyle? Absolutely terrible, primarily for work-related reasons.
As a westerner doing basically anything else that doesn't involve employment at a massive Japanese conglomerate? Excellent.
If you can deal with the lack of English and gain some modicum of comfort with Japanese culture, it's a fantastic place to live.
Agreed! Here are some of the quality of life improvements I've observed between NYC and Tokyo:
- Minimal honking for the amount of cars on the road
- Clean, timely trains, subways, and buses
- Clean streets and sidewalks (unless you go to the busy areas of Shibuya/Shinjuku, it can get nasty there)
- No tipping but you still receive excellent customer service
- Modern apartments with things like auto-filling baths, digital temperature control for hot water, delivery boxes at apartments for package delivery when you're not home, contactless IC cards to unlock your door/mailbox, door video monitors, Toto washlets
This isn't to say NYC doesn't have some of these, it's just less common and you'll be paying more. I do wish Tokyo had more NY pizza and bagels though.
- Minimal honking for the amount of cars on the road
- Clean, timely trains, subways, and buses
- Clean streets and sidewalks (unless you go to the busy areas of Shibuya/Shinjuku, it can get nasty there)
- No tipping but you still receive excellent customer service
- Modern apartments with things like auto-filling baths, digital temperature control for hot water, delivery boxes at apartments for package delivery when you're not home, contactless IC cards to unlock your door/mailbox, door video monitors, Toto washlets
This isn't to say NYC doesn't have some of these, it's just less common and you'll be paying more. I do wish Tokyo had more NY pizza and bagels though.
Heath care costs are quite low as well.
Where I lived (in Osaka) there was a cap of 80,000 JPY* / month for hospital bills - no matter how much the procedure cost.
*80,000 JPY = 721 USD
Where I lived (in Osaka) there was a cap of 80,000 JPY* / month for hospital bills - no matter how much the procedure cost.
*80,000 JPY = 721 USD
And can deal with the racism towards "kaijin"
I assume you mean gaijin and not actually kaijin, which is a fantastical sea monster ;)
In seriousness, there is a decent amount of racism but it’s really not that much worse than other places in Asia - that’s part of what I meant by adapting to Japanese culture. It also gets much better if you speak Japanese.
In seriousness, there is a decent amount of racism but it’s really not that much worse than other places in Asia - that’s part of what I meant by adapting to Japanese culture. It also gets much better if you speak Japanese.
Quality of life as a measure is a societal measure and not an individual measure.
Quality of life could equally be great if you moved to any nation where the economy of your country of origin is relatively stronger to your current one... that, and you choose to ignore the quality of life of your surrounding community.
Quality of life could equally be great if you moved to any nation where the economy of your country of origin is relatively stronger to your current one... that, and you choose to ignore the quality of life of your surrounding community.
> more than SF, more than Manhattan, perhaps about the same as Tokyo
I live in Tokyo, there is no way SF and Manhattan are cheaper. I've visited NYC and found this to be quite obvious. And although I haven't been to SF except for the airport, most people I've talked to who live there always mention the high cost of living.
I live in Tokyo, there is no way SF and Manhattan are cheaper. I've visited NYC and found this to be quite obvious. And although I haven't been to SF except for the airport, most people I've talked to who live there always mention the high cost of living.
Wow really? How much is your apartment, and how many bedrooms?
My apartment is about $980 at the current JPY-USD rate, just one bedroom and 280 square feet. It's not big by any stretch of the imagination but it's located in Shinjuku ward which is one of the "central" city areas of Tokyo (there are many such as Shibuya, Ikebukuro, Ueno, Roppongi, etc.). Keep in mind this is living as a single person, I can't comment on the cost of living as a family in Tokyo.
Food is fairly cheap here and not having a tip system is a big cost saver in my opinion. Fruits and veggies are fairly expensive, unfortunately, but I still think I can confidently say it costs a lot less to live in Tokyo compared to NYC or SF. There are details of national insurance and city taxes and all that which can make individual cases cheaper or more expensive than the average but I don't feel like getting into all the details.
Food is fairly cheap here and not having a tip system is a big cost saver in my opinion. Fruits and veggies are fairly expensive, unfortunately, but I still think I can confidently say it costs a lot less to live in Tokyo compared to NYC or SF. There are details of national insurance and city taxes and all that which can make individual cases cheaper or more expensive than the average but I don't feel like getting into all the details.
I'm paying about the same in Stuttgart (Germany), and NYC or SF is definitely two or three times the price for comparable apartments to mine. I rented a small hotel room in Tokyo (a bit outside, but good metro connection) and it was about the same price as in Germany as well. I really think Tokyo is by far cheaper. But the salaries are probably also not on SF or NYC level.
> But the salaries are probably also not on SF or NYC level
You got that right!
You got that right!
I'm not OP but the biggest cost driver for foreigners in Japan is actually living like a foreigner. If you adapt to the Japanese lifestyle it can be good value; otherwise, you're gonna be paying $15 for a bottle of mustard.
What kinds of things do you include in "living like a foreigner" besides buying foreign foods that aren't commonly eaten in Japan?
Food can be a surprisingly large component if you try to eat a western diet, even if you aren't specifically buying foreign foods. Other things off the top of my head:
- A centrally-located western-style apartment can easily run 2-3x what it would cost vs. compromising on one of those axes (live Japanese style or move farther out)
- Taking taxis or Uber instead of trains
- Going out partying / drinking often (especially to more western-style places if you can't speak Japanese)
- A centrally-located western-style apartment can easily run 2-3x what it would cost vs. compromising on one of those axes (live Japanese style or move farther out)
- Taking taxis or Uber instead of trains
- Going out partying / drinking often (especially to more western-style places if you can't speak Japanese)
> Taxes are insanely high: income tax is on the level as Switzerland; VAT is 24.5%.
What's the employer payroll tax?
For comparison: in Sweden, the employer payroll tax is 31.42%, the income tax is ~30% (depending on where you live) and the VAT is 25% for most goods (food is 12% IIRC).
The employer payroll tax is a bit interesting. As an employee you never see that money, but you more or less pay it (lower wages).
What's the employer payroll tax?
For comparison: in Sweden, the employer payroll tax is 31.42%, the income tax is ~30% (depending on where you live) and the VAT is 25% for most goods (food is 12% IIRC).
The employer payroll tax is a bit interesting. As an employee you never see that money, but you more or less pay it (lower wages).
I personally worked in Denmark in a young startup. I believe conditions are similar to Norway.
I found that the tech scene is very much alive and you can find VC quite easily if you don't limit yourself to the country. The Nordic countries are well connected and it is easy to get funded by Swedish VC for example while being located in Denmark. It's also very easy to do business in the EU.
Has for the taxes, yes they are high, but you need to consider the high quality of life you get in return. It is better than even Canada where I am from. Stressed and unhappy employees are not going to perform well. I also felt there was a common goal in the company, that I wasn't just a necessary "resource" needed by the company. This is very different from the North American way.
I found that the tech scene is very much alive and you can find VC quite easily if you don't limit yourself to the country. The Nordic countries are well connected and it is easy to get funded by Swedish VC for example while being located in Denmark. It's also very easy to do business in the EU.
Has for the taxes, yes they are high, but you need to consider the high quality of life you get in return. It is better than even Canada where I am from. Stressed and unhappy employees are not going to perform well. I also felt there was a common goal in the company, that I wasn't just a necessary "resource" needed by the company. This is very different from the North American way.
> Stressed and unhappy employees are not going to perform well
I like the sound of that. But I wonder why aren't there more startups then?
I like the sound of that. But I wonder why aren't there more startups then?
Maybe because starting a startup itself comes with the baggage of stress and unhappiness - so people, in general, are less inclined to take it up in the first place?
I work at a startup in India and see how the founders are always busy and manage just 4-5 hrs of sleep at best and I've heard it was way worse in the beginning. So this doesn't paint a rosy picture. In fact I gave up on doing my own start up dream just because of this - I figured the stress and pressure isn't something I can handle or is worth the sacrifice for me. (By the way, my friend and colleague started the venture with two other people and it's doing "okay" - it's been just two years. PS - I don't regret it, from what I saw I knew I would not have been able to handle it; add the cash issue for almost 9 months - they literally lived on shoestring)
So if for someone (and I am not alone of course) who is from a country where work life conditions checks, rules that ensure a healthy work-life balance, or ensure work place safety[0] are non existent - and pretty much zero employee rights for all practical purposes, it would be even more unappealing to someone from a place like Norway where people take these things for granted. Now, what I am talking about is the general, I am sure there are exceptions everywhere.
[0] Yes, for e.g. pretty much every tech park building I have worked in in Bangalore if there was a fire either a lot of people would die in stampede, jumping from the windows, or actually in fire. Such safety checks were a joke 10 yrs ago and they still are.
I work at a startup in India and see how the founders are always busy and manage just 4-5 hrs of sleep at best and I've heard it was way worse in the beginning. So this doesn't paint a rosy picture. In fact I gave up on doing my own start up dream just because of this - I figured the stress and pressure isn't something I can handle or is worth the sacrifice for me. (By the way, my friend and colleague started the venture with two other people and it's doing "okay" - it's been just two years. PS - I don't regret it, from what I saw I knew I would not have been able to handle it; add the cash issue for almost 9 months - they literally lived on shoestring)
So if for someone (and I am not alone of course) who is from a country where work life conditions checks, rules that ensure a healthy work-life balance, or ensure work place safety[0] are non existent - and pretty much zero employee rights for all practical purposes, it would be even more unappealing to someone from a place like Norway where people take these things for granted. Now, what I am talking about is the general, I am sure there are exceptions everywhere.
[0] Yes, for e.g. pretty much every tech park building I have worked in in Bangalore if there was a fire either a lot of people would die in stampede, jumping from the windows, or actually in fire. Such safety checks were a joke 10 yrs ago and they still are.
> so people, in general, are less inclined to take it up in the first place?
Yeah, the dark side of startups is that many fail, people are laid off, funding dries out, etc. VCes swoop in and try another startup and so on. That helps grow unicorns as they say, but it also based on quite a bit of pain and uncertainty for workers.
Yeah, the dark side of startups is that many fail, people are laid off, funding dries out, etc. VCes swoop in and try another startup and so on. That helps grow unicorns as they say, but it also based on quite a bit of pain and uncertainty for workers.
Hum, I think there are many factors to that. Just a couple who come to my mind:
-The population is way smaller than USA even if you regroup all countries of the Nordic area. It would be nice to have a number per capita which would paint a better picture.
-I believe the right conditions for a tech scene to emerge were recently met in most of those countries. I see a lot of nordic fintech and fintech is a relatively recent phenomena.
-I think that there were not many VC around a couple of years ago. Even though it is better now, it might not be as easy to get founding than it is in the Valley.
-Regulation is way more restrictive in those countries. You can't just arrive and break what I would call the social contracts (like Uber is doing for example).
- etc etc
Thanks for replying and for your perspective.
> I see a lot of nordic fintech and fintech is a relatively recent phenomena.
Yes I have seen that too. Talked to someone in a fintech startup. They were even using Erlang to do all the math, which surprised me, but it totally made sense after they explained their use case.
So perhaps maybe there is a startup culture and but maybe the focus is on slightly different market and not necessarily on the same old social / messaging / uber for X problems that are common in SV startups.
> You can't just arrive and break what I would call the social contracts (like Uber is doing for example).
Unfortunately I think at lot of the conditions to make startup appealing are predicated on breaking social contracts. The concept of a "company" > "individual" basically. A startup can hire quickly, try something, fail and lay everyone off, within a year. Or playing in the gray area like Uber with regards to its markets. "Is it a taxi, is it a limousine service, etc."
> I see a lot of nordic fintech and fintech is a relatively recent phenomena.
Yes I have seen that too. Talked to someone in a fintech startup. They were even using Erlang to do all the math, which surprised me, but it totally made sense after they explained their use case.
So perhaps maybe there is a startup culture and but maybe the focus is on slightly different market and not necessarily on the same old social / messaging / uber for X problems that are common in SV startups.
> You can't just arrive and break what I would call the social contracts (like Uber is doing for example).
Unfortunately I think at lot of the conditions to make startup appealing are predicated on breaking social contracts. The concept of a "company" > "individual" basically. A startup can hire quickly, try something, fail and lay everyone off, within a year. Or playing in the gray area like Uber with regards to its markets. "Is it a taxi, is it a limousine service, etc."
I'm sure the wealth tax of ca 1% of your net worth per year and the weather would put off a fair few people for making the move.
That would be my one major drawback against starting up here in Norway. I've seen calculations of how companies like Facebook would fare if they started up in Norway, and it wasn't pretty. You pay tax on the value of your shares, even if the company isn't making money...
However, for start-ups that aren't looking to have hundreds of millions of users/customers before breaking even, it is still worth a shot!
However, for start-ups that aren't looking to have hundreds of millions of users/customers before breaking even, it is still worth a shot!
I'm from Norway and working for a startup. You do not have to pay tax for the value of your shares, but for the assets that the company own. For a tech startup that means laptops and workstations.
With the cost of employemnt and lack of VCs I doubt they would be very successful.
Gas prices in Norway are 3.5x what they are in the u.s. Everything in Norway is about 3x the price of the u.s. Most parts of Norway are rural, even simple things are a far away drive. The people are nice, but to say that everyone speaks english over there is also a stretch. Maybe 25% speak english, if that. You also have to pay to use the bathroom. It is also very cold there most of the year. Money does go very fast over there, the fastest I have seen in any country. Is it good for a startup? If money is your concern, then no IMHO.
Sorry for telling the truth because I've lived there... :) Maybe you can find a way to delete this post and keep all the flowery ones.
Sorry for telling the truth because I've lived there... :) Maybe you can find a way to delete this post and keep all the flowery ones.
Norwegian here who currently lives in the US. About everything in your comment sounds wrong to me, except for the statement that gas is more expensive.
English has been part of the mandatory elementary school curriculum since 1974, and I would say that pretty much everyone knows English quite well except for a minority of older people in rural areas.
Norway being a cold, wintery country is something of a fantasy. The climate is much milder than you might except from the latitude. It's not very different from New England, though summers are not quite as hot.
English has been part of the mandatory elementary school curriculum since 1974, and I would say that pretty much everyone knows English quite well except for a minority of older people in rural areas.
Norway being a cold, wintery country is something of a fantasy. The climate is much milder than you might except from the latitude. It's not very different from New England, though summers are not quite as hot.
I’ve only been there for shorter periods, but the only people I met who didn’t speak English were other tourists from non-English speaking countries. Every single local I met spoke English fluently.
You pay a few cents to use bathrooms, but in return you get very clean and pleasant services. I wish I could pay for bathrooms in some other cities.
You pay a few cents to use bathrooms, but in return you get very clean and pleasant services. I wish I could pay for bathrooms in some other cities.
Sure. So that you can run out of money in 1 mo. instead of 6 in S.F. :-/
Startups that need to prove their value proposition before the money runs out should come to Poland. Very techy (Warsaw, Wroclaw in particular), and you have 2 years instead of 6 months (or 1) because of the extremely low cost of living. As a plus, really cheap beer and beautiful women.
Startups that need to prove their value proposition before the money runs out should come to Poland. Very techy (Warsaw, Wroclaw in particular), and you have 2 years instead of 6 months (or 1) because of the extremely low cost of living. As a plus, really cheap beer and beautiful women.
come to Poland.
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Sorry, as the topic was Norway I was only talking about Europe.
As for the language, I'm Italian working with devs and I've yet to find any dev that doesn't speak English fluently. Not the same for regular people, but not sure about Norway, either.
As for the language, I'm Italian working with devs and I've yet to find any dev that doesn't speak English fluently. Not the same for regular people, but not sure about Norway, either.
I worked on site with a dev team in Sopot for a few weeks. While really nice guys, their English was not very good. The frigid temperatures by October were also an issue.
You have to go to semi-major, techy cities. I'm in Wroclaw and it's perfect for startups, Warsaw for huge corporations.
They even speak English among themselves.
They even speak English among themselves.
Mexico has the advantage of beaches and a few hour plane ride from the States to visit your loved ones. And better weather and an easier language.
Poland is certainly a great place as well. As I get older though it's nice being a 2 hour plane ride from my aging parents in Texas.
Poland is certainly a great place as well. As I get older though it's nice being a 2 hour plane ride from my aging parents in Texas.
If I were looking somewhere in the Americas I'd probably choose Chile for some of the same reasons you mentioned. Santiago is a great town, relatively safe, and Chile has probably the most stable government in Central / South America.
It doesn't fit the short flight criteria, but it's better than going Oslo to Dallas.
It doesn't fit the short flight criteria, but it's better than going Oslo to Dallas.
What part of Mexico are you based out of? What download speeds are you seeing?
If we're talking about North America, sure--if there are a lot of devs and not a lot of crime (no idea).
Another very good option in North America is the Kitchener-Waterloo region in Ontario.
Pros:
- Significantly lower rent (~640 USD/mo for a one bedroom apartment in one of the safest neighbourhoods of Waterloo)
- Low crime rate and very safe
- Access to talent that has experience working for SV companies (facebook, google, amazon, apple, etc.)
- Active 24/7. Even at 4am in the morning, there are students walking home from the library.
- You don't have to learn a new language
Cons:
- Bad weather
- An hour drive to the international airport in Toronto
- Nothing else to do in the city other than working
- Public transit only runs until midnight
Pros:
- Significantly lower rent (~640 USD/mo for a one bedroom apartment in one of the safest neighbourhoods of Waterloo)
- Low crime rate and very safe
- Access to talent that has experience working for SV companies (facebook, google, amazon, apple, etc.)
- Active 24/7. Even at 4am in the morning, there are students walking home from the library.
- You don't have to learn a new language
Cons:
- Bad weather
- An hour drive to the international airport in Toronto
- Nothing else to do in the city other than working
- Public transit only runs until midnight
I'd pick that over Mexico any day.
Mexico also has a bonus 'do not travel' advisory in 5 states, for those seeking that extra bit of excitement.
Maybe surprisingly, Norway is cheaper than SF for many people. (Not as cheap as Poland, of course.) Admittedly, a lot of consumer goods are more expensive in Norway than SF (especially alcohol). But rent is lower, even in Oslo, which is likely to be many people's biggest expense. Also, health insurance is included in the tax rate instead of a separate expense.
Rent might be lower, but taxes are much higher, making it much harder to come up with the cash required to pay rent from salary. If you're not a first-timer, but someone with a previous exit and some capital under your belt, then there is the wealth tax to deal with.
If you're already rich, yeah, that's a different scenario, then you have a whole wealth-planning thing to think about. If we're talking about a startup founder making more in the neighborhood of low 6 figures, though, taxes are basically a wash between Norway and SF, and cheaper in Norway if you take into account that it includes health insurance while the US taxes don't. For me, what taxes I'd pay if I exited with a fabulously wealthy payday are more in the "Maserati problem" category, but ymmv.
Putting in $100k into a Norwegian [1] and CA [2] tax calculator, for example, at that particular income they coincidentally come out almost identical: about $32k (~32% effective rate) in both cases. In Norway it's one central tax at the effective rate of 32%. In SF it's the sum of: 18% federal, 7.65% payroll, 6.3% state.
[1] https://skattekalkulator.app.skatteetaten.no/
[2] https://smartasset.com/taxes/california-tax-calculator
Putting in $100k into a Norwegian [1] and CA [2] tax calculator, for example, at that particular income they coincidentally come out almost identical: about $32k (~32% effective rate) in both cases. In Norway it's one central tax at the effective rate of 32%. In SF it's the sum of: 18% federal, 7.65% payroll, 6.3% state.
[1] https://skattekalkulator.app.skatteetaten.no/
[2] https://smartasset.com/taxes/california-tax-calculator
And a pretty great bunch of 8-bit Atari enthusiasts to boot! (not a startup, but still really look forward to visiting someday)
How is the rent scene there? And the general cost of living - for a graduate student? Is English sufficient to live by as it is in say Germany and NL, at least for initial six months or so?
Thinking of keeping it as an option for my MS.
Thinking of keeping it as an option for my MS.
The vast majority of people in the Netherlands speak fluent English.
The author seems to ramble a bit about how amazing Norway is, and then seems to use the article to talk to the PM on a first name basis. Does he know her personally, or would I be correct to assume he's a condescending jackass?
it's a beautiful country, but for a start-up? I have my doubts.
i have also lived in the Bay Area; live here now in fact.
Norway is the most expensive country i have ever lived in or visited--more than SF, more than Manhattan, perhaps about the same as Tokyo, although i have only made brief visits there for work.
Taxes are insanely high: income tax is on the level as Switzerland; VAT is 24.5%. Petrol prices are the highest in any country i have ever driven in.
lastly, working start-up hours (or even normal hours) is not easy during the months of October through February when daylight's non-existent or negligible