In 2020, Malmö was Sweden’s fastest growing city. According to Statistics Sweden, the Swedish Agency for Growth Policy Analysis, and the Swedish Public Employment Office, the last 10 years have been pivotal to the growth of the city. In these last 10 years, 29,000 new companies have been founded, with an increase of 51,000 employees. There has also been a 66% increase in Malmö’s Gross Regional Domestic Product.

These statistics go to show that this up-and-coming city is a force to be reckoned with, and those within the city’s startup ecosystem believe this too.

Sweden’s ecosystem

Sweden as a country has a vibrant startup ecosystem. According to Startup Blink’s 2024 Global Startup Ecosystem Index Report, Sweden retained its spot as the leading startup ecosystem in the EU, in Europe it is second, just behind the UK, and globally it is ranked sixth.

Over the past decade, Sweden has solidified its position as a leading global startup hub. Boasting over 7,000 startups and scaleups, the country has produced 41 unicorns, including notable names like Spotify, Klarna, and Oatly. Sweden also leads Europe in exit values exceeding $1 billion, surpassing major global players such as Singapore and Canada.

But when it comes to Malmö specifically, members of its startup ecosystem have weighed in to discuss why they believe the city itself is a startup hotspot.

What specific factors make Malmö an attractive city to start and scale a business?

Malmö is an attractive city to start and scale a business for many reasons, from the diversity of the people that live in the city to its community to its strategic positioning allowing it access to multiple startup ecosystems.

In the opinion of Sanna Lindberg, Head of Communications, Minc: “Malmö has positioned itself as a competitive startup hub thanks to its diversity, strategic location, and affordability. As Sweden’s most international city, it brings together a mix of industries and perspectives that drive innovation. The proximity to Copenhagen gives startups direct access to the Nordic market, investors, and a wider talent pool.

“Malmö also offers a high quality of life at a lower cost than Stockholm or Copenhagen, making it an attractive destination for founders looking to scale sustainably. The city’s strengths in shipping, logistics, design, and sustainability are now converging with deeptech and innovation, creating new opportunities for startups solving global challenges.”

Malmö is strategically positioned, being only 20 minutes by train away from Copenhagen, via Øresund Bridge. This proximity to Copenhagen has allowed Swedish startups to tap into Denmark’s funding ecosystem and talent pool, making the region an integrated innovation hub.

Another factor that makes Malmö’s startup ecosystem strong is the community and its willingness to help each other.

Ulrika Forsgren Högman, Head of Innovation and Development at the Business and External Relations department at the City of Malmö, discussed: “We have a very strong community in Malmö when it comes to helping each other. We have this mentality that sharing is caring, and other people want to be in this very strong community in Malmö. When it comes to people knowing each other, helping each other, it's a very creative environment.”

Malmö is a city that thrives on collaboration and helping each other. Lindberg mentioned: “Malmö’s startup scene is defined by its cross-sector collaboration and open network. Startups, investors, universities, and public institutions work together to build a stronger innovation ecosystem.

“The city’s diversity is another key driver. With over 40 nationalities represented in the startup community, Malmö attracts global talent and fosters an environment where different perspectives fuel creativity and business growth. The ecosystem also benefits from a strong culture of knowledge-sharing, with experienced entrepreneurs investing time and resources into supporting new founders.”

Policies and initiatives

For an area to thrive as a startup hotspot, at its core, there need to be policies and initiatives that encourage innovation in the space. A startup ecosystem can struggle to thrive without outside help from the government and investment.

Högman explained one of the biggest initiatives: “I think the Malmö incubator Minc, which was started 20 years ago, has been a very important actor in that sense.”

Lindberg’s opinion reflected on these comments, adding: “The foundation for Malmö’s startup ecosystem began 22 years ago when the city started Minc. Building a strong, thriving entrepreneurial environment requires long-term commitment, and local policymakers played a critical role in ensuring that infrastructure and support systems were in place.”

Minc is the startup house of Malmö, right in the heart of the city. Established in 2002 by the City of Malmö, Minc has provided a platform for hundreds of entrepreneurs aiming to make a positive impact on the world. Being a not-for-profit organisation, Minc exists for the good of the community, with founders at the centre of its mission.

Minc offers a comprehensive suite of programmes for startups, tailored to the various stages of the entrepreneurial journey:

• Minc Sprint: this is a 10-week programme designed to help entrepreneurs validate their business ideas through customer engagement, prototyping, and offer validation for the idea
• Incubator: the incubator is a year-long programme for startups with a verified business idea, minimum viable product (MVP), and a dedicated team, focusing on growth and scalability
• Fast Track Malmö: an accelerator programme that aims to assist regional startups in securing venture capital funding to elevate and help scale their business

Minc also offers a wide range of support, including coaching, workshops to help with ensuring businesses are able to grow sustainably, and offers a network of expertise. Whilst the space offers plenty of accelerator programmes and help to the startups inside of it, a huge element of the Minc experience is the community that has been established within the incubator.

In conversation with Erik Rask, CEO and Founder of MedBeat, a startup that has developed a wearable, non-invasive device for continuous electrocardiogram (ECG) monitoring, I asked why he chose Minc as a base for the startup. He commented: “Because of the community. Minc is a small startup house here in Malmö, so it’s not in the capital. There are a lot of startups here, and I just love being in the building with all of them. You can always get some quick meetings over a coffee. You have companies from all sectors, and you can get inspired, and have someone to complain to. We could find office space somewhere else, but we definitely couldn’t find the community anywhere else.”

Support for startups

Already discussed above, Minc is one of the main support networks in the city, but it is not the only one. Media Evolution City is a community and co-working space focused on creative, media, and tech startups.

It provides networking events, knowledge-sharing, and business development support, all to help the startups within these specific sectors. Alhough based in Lund, Ideon Science Park is pretty close to the city of Malmö, and supports many of the city’s startups, particularly in deeptech, medtech, and AI. It offers connections to research institutions and corporates, and aids companies to accelerate the process of innovation.

Universities and research institutions have also played a significant role in Malmö’s startup ecosystem by driving innovation, fostering talent, and facilitating collaboration between academia and industry.

Lindberg commented on a turning point for Malmö’s startup ecosystem: “A turning point was Malmö University’s transition from a college to a full-scale university, which expanded research capabilities and strengthened the pipeline of talent and ideas. Today, policies around sustainability, inclusion, and business development continue to shape Malmö’s position as a leading startup hub.”

What can be done to attract investment and strengthen the ecosystem?

Malmö has a strong startup ecosystem, but moving forward, there is a drive to encourage capital and attract further investment within the space.

In conversation with those in the ecosystem, a big theme of the state of the current ecosystem is that the community spirit is there and the drive for startups to help each other out, however, there is a lack of capital in the space.

“It’s easier to get funding in the very early stages, but it’s very difficult when it comes to scaling up,” Högman explained. “We’re strong at pre-seed, and seed capital, but then it’s more difficult.”

So, what can be done about this?

Lindberg gave her opinion on how the ecosystem could be improved: “Malmö has the talent and the ambition. The next step is to scale access to capital and strengthen the city’s position as a destination for international investors.

• More investment opportunities: expanding local VC funds, increasing public-private investment initiatives, and making funding more accessible at every stage of growth
• Talent attraction and retention: simplifying hiring processes for international talent, offering English-friendly services, and developing specialised education in tech and sustainability
• Infrastructure and connectivity: the Öresund metro, stronger links to Hamburg, and a designated startup district would increase Malmö’s appeal as a hub for scaleups
• Global positioning: raising Malmö’s visibility through high-profile startup events, stronger ties to international investor networks, and positioning the city as a testbed for impact innovation.

“The focus should be on ensuring that Malmö isn’t just a great place to start a business, but a city where high-growth startups choose to scale.”

Working at the City of Malmö, Högman discussed the different ways it is trying to encourage further investment. A large part of this is finding alternative investment routes, as well as encouraging more venture capital activity. “I think Malmö can attract the capital in new way. We’re really focusing on growth in different important industries, and solving challenges that world is facing now. When it comes to that, we can find capital through these initiatives.”

Malmö is still up-and-coming as a startup hotspot, but the entrepreneurial excellence in the city is plenty. With such a strong startup community, Malmö is the place to be to start and scale your business. After all, it takes a village.

This article originally appeared in the March/April 2025 issue of Startups Magazine. Click here to subscribe