This month I have taken part in founding a start-up abroad. There are four partners in the firm, two Icelanders and two Finns, one residing in the US. The idea came about in Iceland, but when it came to incorporating there were some serious issues we had to ponder.
1. Currency restrictions and worthless ISK.
The business operates online and sales are in Euros and US Dollars. With currency restrictions in place it makes no sense to form a company in Iceland.
We want to operate within a financial system that works.
2. Lack of trust and credibility
We would like to trust the institutions that impact our business indirectly and we have to deal with directly, such as banks, accountants, lawyers, government, official institutions etc. Our trust in those institutions in Iceland is low.
We don‘t have friends in high places to do us favors. Our company and ourselves have to earn our status, whatever it will be. That sounds good to us.
3. Higher taxes
In the country we decided to incorporate we have to pay higher taxes. Instead the business framework seems healthy and our business‘ well-being seems to go hand in hand with the well-being of the society where it is based.
We like that idea.
4. Uncertainty and Future Prospects
As someone who makes a lot of sense remarked recently, “Iceland is not the land of the future“ . The past and present governments have laid the foundation for lives in unessecary poverty for our generation and the next. The political and economic outlook for the next decade are uncertain at best.
We don‘t have a decade to spare in our short lives.
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Four Good Reasons Why I Am Starting a Start-up Away From Iceland! | iceland today
1 year ago
[...] Read more here: Four Good Reasons Why I Am Starting a Start-up Away From Iceland! [...]
Andrew
1 year ago
Good luck with the new business. So where did you decide to incorporate your company? Finland, the US or elsewhere?
Inger Le Gué
1 year ago
I understand all the business reasons you mention and from a business point of view it seems to make a lot of sense.
I also understand that a lot of Icelanders are in survival mode now and cannot afford to take into consideration anything else but their own short term (“not a decade to spare”) business reasons.
Nevertheless: “The best way to predict the future is to build it” and it makes me really sad to see that people like you – that should build that future – give up on Iceland and start building it somewhere else. Thus “Iceland is not the land of the future” becomes a self-fulfilling provecy.
Dadi
1 year ago
Andrew: Thanks. It was Finland.
Inger: It is not a short term question for only us but also our partners. Short term or long term, how can you justify for a foreigner to invest in Iceland unless you have some “special deals” on the side? We are not connected politically so we don’t have those to offer.
It is extremely sad from our viewpoint that our country is not a viable option. Note that we are moving closer to the age of 35 and have spent the last decade trying to build a life in Iceland. The Icelandic Krona, the economic policies of the parties which still have an iron grip on the country and a corrupt business-environment have torn all that down.
Like the Icelandic saying goes, “a burned baby avoids the fire”. We had to ask ourselves whether things were likely to get better. With growing nationalism, partisanship and the way things have been handled so far, we are sceptical at best. At worst it seems like the most powerful forces in our society cannot wait for things to get back to the way they were.
snowball
1 year ago
dadi, it would be a pity if you stop bloging via this website. although you could blog from perspective of an icelandic emigrant…probably very interesting as you are not the only one relocating.
anyway, mazel tov with your start up!
andy
1 year ago
Best of luck. Understand the rationality. You need good grund for a business to start up on.
Daði
1 year ago
Just to clear up the misunderstanding that I am moving abroad.
The business is an online service. Our operation is in Finland, our IT is done in Iceland and our marketing is done online. The business pays its tax in Finland, I pay taxes on my personal income in Iceland for now.
For now, my own ambitions of moving abroad are still at the Plan B level. Not to move abroad for its own sake but to be open for it when the situation is convenient. I lived abroad for five years before and I would relish the opportunity again.
Andrew
1 year ago
I used to work in IT in the UK, but live in Canada. Telecommuting is now quite possible, so you can take advantage of where the work is and where you want to live. It doesn’t work for everyone! If you are working from home, I advise converting one room into “the office”, where you go to work. It helps to have a separate space. At least your time zones aren’t as far off as Canada/UK.
JP
1 year ago
I wish you good luck in whatever you undertake Dadi, but I still think that too hastily moves are on the bad side.
The future of Iceland really is uncertain, but as world events show it is uncertain for any part of world, especially for EU.
In my opinion Finland economy is just before entering a crisis caused by Nokia problems, Euro problems and aged population.
The statements that “Iceland is not the land of the future” makes me lol
, but let the future tell who is right.
As long as Iceland has electricity and water it is a land of future, and maybe a land of survivors
Dadi
1 year ago
Thanks JP. In theory every land is a land of the future, just differently so. If the past is any indicator of the future it won’t be long until the water and the electricity will be sold off to the lowest bidders.
And then, I just have more ambitions for my life than being a mere survivor
Carl Mosconi
1 year ago
Good luck Dadi! Hope you continue to post from your new location.
D_Boone
1 year ago
Best of luck with the new venture. Continue posting as well.
Icelandic Businesses Need A Future Plan
1 year ago
[...] Yet again the need for the Independence Party, Centre Party and the Left Greens to reveal their vision for an Icelandic future is apparent. Hilmar’s situation reminds me why this spring I took part in setting up a start-up away from Iceland: [...]