Sweden is not only the land that saw the birth of Ikea or that adopts an almost military posture when ABBA songs are played as if it were the national anthem, the Swedes have also become a country that has achieved something extremely complicated: multiply by 20 the number of local millionaires in the last three decades, and has done so without the need to issue golden passports. Their secret: the “unicorns”.
The best unicorns grow in Sweden. In the jargon of the financial sector, a startup that reaches a value above $1 billion in a relatively short period of time is called a “unicorn.” In Spain, companies like Glovo, Fever, Idealista or Domestika are some examples of unicorns.
In the case of Sweden, its entrepreneurial ecosystem has created the perfect breeding ground for, in the last thirty years, several of these unicorns to have been generated that have made their founders incredibly rich. Especially in Stockholm, its capital.
More unicorns, more millionaires. According to data BBC News from the former Swedish business magazine Veckans Affärer, in 1996, the number of people with more than one billion crowns in Sweden was only 28. In most cases, these millionaires were millionaires by family legacy. In contrast, in 2021, the number of crown millionaires was 542 people. Together they had a combined fortune equivalent to 70% of the country’s GDP.
In its latest edition of 2024, the list of millionaires Forbes has included 43 representatives of Sweden with more than a billion dollars. These figures, by themselves, do not seem too high, but they take on a different dimension when we take into account that Sweden has a population of only 10.5 million inhabitants, which leaves us with a proportion of four ultra-rich for every million people. inhabitants, while in the United States it is only two ultra-rich per million inhabitants.
Stockholm, a Silicon Valley with less sun than in California. These fortunes have grown under the protection of unicorns born in the startup incubators of Stockholm. For this reason, Sweden is earning the nickname “Nordic Silicon Valley” due to the large number of Swedish technology and R&D-related startups that have become unicorns in recent years.
We are talking about names like Spotify, Skype, Mojang, King (the developer of Candy Crush Saga) or the Klarna payment system, which have flourished under the protection of very low interest rates, which has accelerated investments.
“Friendly” policies for millionaires. During the last decades, Sweden has not applied an overly restrictive policy with capital in tax matters, although it has a fairly equitable collection for capital returns. For example, according to OECD data from 2021, Sweden’s tax burden is 42.7%. The OECD average in 2021 was 34.2% and that of Spain was 37.8%.
Sweden eliminated wealth taxes and inheritance taxes in the 2000s. And taxes on stock income and dividends are lower than taxes on salary income. Similarly, the corporate tax stands at 20.6%, compared to the 25% from Spain or 21.5% of the European average. “You don’t need to leave Sweden if you’re a billionaire today. And in fact, some billionaires are moving here,” he tells the BBC. Andreas Cervenkajournalist for the Swedish economic portal Aftonbladet.
Distributive culture with impact investments. Swedish culture has also had a lot to do with the social development of Sweden. Swedish millionaires are reinvesting their fortunes in local impact investments that generate wealth for the rest of the population.
According to Dealroom data, the Nordic countries allocated 38% of startup venture capital funding to impact investments. Well above the 22% of the European average or the 10% of what the United States or Asia allocates. In short, Nordic millionaires are less likely to accumulate wealth and buy superyachts or private jets, and they dedicate their fortunes to financing new startups with social and climate impact.
In Xataka | How many are there and where do the world’s ultra-rich live, explained in a single graph?
Image | Pexels (Efrem Efre), Flickr (Mariano Mantel)
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