Odense set fra havnen

Global CoBot Capital in times of Trade Wars and Beauty Contests

Invest in Odense cases

When wrapping up 2018 from a direct investment perspective, you will have to navigate in economic universes that could not be further apart.

On the one hand, the UN reported that Global Foreign Direct Investment (FDI) fell by 19% in 2018. Most dramatically in Europe, that saw an unprecedented 73% decline of inflows to just €88 billion, the lowest point since the 1990s. Explanations for this negative trend circle around topics like US trade wars, Brexit and countries and enterprises backing out of the globalization agenda.

On the other hand, key industries with significant importance for the Odense area are experiencing an extraordinary boom. Robotics (notably collaborative robots) and medical cannabis all had a tremendous year in 2018. Universal Robots “only” had 38% growth  and that was considered “not satisfying”. UR’s parent company, Teradyne, also bought Mobile Industrial Robots from Odense last year – cementing the city’s position as the Global CoBot Capital.

In addition, we are currently experiencing a cultural shift within the investment field. Attracting direct investments has moved from discrete backroom negotiations to primetime beauty contests. When Amazon announced a second HQ in the USA, more than 200 cities presented bid books, openly competing for 50.000 new jobs, announcing tax breaks and other incentives worth nearly $3 billion. Another example is how the Dutch government employed extra staff to target international companies with offices in London. In 2018, they managed to bring 42 companies to the Netherlands because of Brexit, accounting for 1.923 jobs.

So how do these international trends reflect in a local context? In 2018, we noticed that mainly SMEs (small and medium size enterprises) choose to move to Odense or start a branch office in Odense. The number of jobs created as a direct result of these investments was quite a bit lower compared to 2017, when datacenter construction and medical cannabis production sites had a significant job effect.

2016 2017 2018
Number of investment cases / attracted companies 24 30 35
Direct jobs created 190 1218 78
Growth in revenue / Investment (DKK million) 598 1018 979
Capital raised via Investor Network (DKK million) 48 80 105

The companies that we assisted in (re)locating their business to Odense in 2018, can be divided into the following categories: Robotics (19), Health Technology (4), Drones (2), Datacenter business (1), Others (5). In addition to that, our team assisted with 4 major real estate investments. The Odense Robotics cluster proved to be a strong magnet when attracting new companies to Odense, such as Fishi Robotics from Silicon Valley and RobNor from Norway. Health Tech company Mari Care (Finland) also expanded to Odense.

Typically, successful investment projects are the result of close collaboration with Invest in Denmark, the unique clusters in the Odense area, and the flexible business unit “Erhvervskontakten” at the City of Odense.

In 2019. Invest in Odense has started to measure long-term effects. The first long-term analysis has focused on the 43 companies that have raised DKK 243 million with the assistance of Invest in Odense during the period of 2016-2018. The results have shown that these companies have created more than 97 new jobs in the 2-year period. The figures also show that companies that received venture capital in 2016, in average add 1 new employee for each million DKK capital raised.

Attracting direct investments means competing in a global context. Therefore, making a difference is only possible when focusing on unique comparative positions of strength. That is why Invest in Odense will continue to promote the city’s unique capabilities within robotics/automation, drones and health-tech/medical cannabis. We will provide these assets, and access to the strong local triple helix networks as our contribution to the work with Invest in Denmark and other partners.

Further information:

Head of Investment
Joost Nijhoff
+45 4046 9001