An intense structural change is still underway in the region
The South Karelia region has undergone an intense structural change in the past few years, and industry has reformed and amended its model of operation. A significant number of jobs have been lost in basic industry, and the effects have hit the whole region hard.
As this structural change is proceeding, and the significance of competence-based businesses for Imatra and all of Southeast Finland has become extremely important. At the general level, we can say that, when measured by tax revenue, one competence-based job corresponds to approximately three jobs in the service sector. Grounds for this include the high level of salaries and full-time employment relationships. From this perspective, competence-based jobs can defeat the consequences of declining industrial jobs for the region’s economy.
In Lappeenranta, for instance, about two competence-based enterprises are established every year when that number was approx. 10–15 per year in the early 2000s. The end of the technology incubator operation in Lappeenranta at the end of 2010 is regarded as a key reason for the reduction in the establishment of new technology companies. After this, the Lappeenranta region has not systematically invested in the creation of competence-based businesses or in supporting their growth in the initial stage. Some competence-based enterprises set up in the last decade have become significant technology companies, exporting their products from the region.
Investments in increasing the number of competence-based businesses
In its long-term strategy, the City of Lappeenranta has made the development of competence-based businesses one of the spearheads of its strategy. Various operators in the region have set out to implement this strategy through cooperation. The StartupMill operation has been turned into one of the key projects in the 2014 implementation plan of the entire province.
The current Government Programme also mentions competence-based enterprises as key creators of new growth in Finland, and the significance of their establishment is a critical success factor both regionally and at a national level.
According to research, the creation and launch of competence-based businesses is very different from starting “traditional business operations”. Competence-based businesses’ need for longer-term development support is recognised all over the world, and their capital-intensive nature at the launch stage is a significant threshold for starting operation.
In order to increase the number of competence-based businesses in our region, Wirma Lappeenranta Oy, the development company of the Imatra region and Lappeenranta University of Technology (LUT) have started a project called StartupMill, aimed at
- significantly accelerating the launch and growth process of competence-based enterprises established in the Lappeenranta-Imatra region
- making it possible to exploit all the potential business ideas created in the region
- reaching a level where 15 new competence-based enterprises are created every year
- ensuring that new companies, based on good business ideas, survive across the death trap
- multiplying the number of jobs created at the new companies
- unifying the practices and operational models of the region’s various operators (educational institutions, municipalities and other innovative operators) in terms of “from idea to business operation” processes
- activating entrepreneurship and focusing students’ attention on entrepreneurship as a career alternative.
The development and launch of the StartupMill operational model are extremely important for enhancing the vitality and economic structure of our region. Operators who have been involved in the preparation of the project are committed to the new StartupMill operation over the long term.