Multiple Finnish companies have decided to establish their first office in the United States in Chicago due to city’s easy accessibility, cost effectiveness, availability of talented workforce, and diversified and dynamic economy.
Chicago is a thriving metropolis located in the state of Illinois by Lake Michigan with a population of 2.7 million. The centrally-located city is connected to all six North American railroads, six major U.S. Interstates, and Chicago’s airports have flights between more than 200 cities worldwide. In addition, the time difference to Finland is only 8 hours and flight time to Helsinki is 9 hours. Finnair operates direct flights to the city between April and October.
When it comes to doing business in Chicago, one of the main advantages of the metropolis is its cost-effectiveness in comparison to other major cities. In 2016 KPMG ranked Chicago as one of the most cost-effective cities in the world for doing business leaving far behind places such as New York and Los Angeles. The KPMG´s study analyzed the combined impact of 26 significant business cost components including labor, utilities, facility, transportation, financing costs, and taxes. For example, according to a global commercial real estate consultancy firm CBRE, office space in the Chicago CBD costs approximately 50% less than in Manhattan, New York.
Chicago also benefits from one of the world’s largest and most diversified economies. The city is home for more than 400 corporate headquarters such as Boeing, McDonald’s and All State. In particular, the local economy thrives on manufacturing, distribution and transportation industries, as well as business and financial services. Furthermore, Chicago has strong company clusters in green energy, research and development, and information technology.
Furthermore, Chicago has dozens of universities and colleges with a student population of approximately 700,000 providing tens of thousands of young talented graduates to serve region’s growing companies every year. The city also offers a vibrant mix of cultural and social amenities making it a great place to live.
Finally, Chicago’s business-friendly environment with various annual business conferences and networking events provide companies with great opportunities to create new contacts and get familiar with the main stakeholders in any industry. McCormick Place is the third largest convention center in the world hosting a large number of exceptional business conferences, trade fairs and exhibitions every year such as International Manufacturing Technology Show and Pack Expo.
The Finnish American Chamber of Commerce Chicago (FACC Chicago) and LandInChicago provide assistance and relevant contacts to Finnish companies who are considering to locating to the region. FACC Chicago is a part of the 11 chapter non-profit U.S. wide FACC network while LandInChicago is a 12-week intensive market entry program that helps Finnish growth companies perform their US market entry through Chicago and its premier technology hub, 1871.
Case Study: NOOA by TripleWin
TripleWin is a 2009-founded Finnish company which has created a unique SaaS platform NOOA for leading and executing organizational change. NOOA was created for global markets from the beginning, and when NOOA was selected in the LandInChicago’s internationalization program, the company became familiar with the many opportunities that Chicago has to offer.
The LandInChigaco program consists of a 12-week intensive acceleration period conducted part in Finland and part in the United States as well as a 9-month follow-on support period which provides practical assistance to growth companies in continuing the momentum achieved during the 12-week program and establishing a sustainable foothold in the US market. NOOA was successful in finding customers through the program and as a result opened an office in Chicago to be closer to the U.S. customers.
When asked about the most important factor in getting a new product to the U.S. market, TripleWin CEO Tom Grönstrand has a clear answer, “Finding the first customer which can be used as a reference is crucial in any market, but in particular in the U.S.”. Tom also encourages Finnish companies to go the U.S. even though the product would not be fully ready because it will anyhow be reshaped when you meet with local customers and other stakeholders. Furthermore, Tom points out that branding should be thought carefully and Finns should let Americans to do it. Finally, the market opportunity is often underestimated by Finnish companies. In NOOA’s case the market potential was first evaluated to be around two billion U.S. dollars, but now the new estimate stands at around 600 billion USD. In addition, Tom says that he can now easily find over 7,000 potential customers associated with their business in the U.S. via LinkedIn while in Finland the number of prospective contacts amounts to roughly two hundred still. In conclusion, Tom encourages Finnish companies to consider Chicago as the landing state to the U.S. besides more familiar locations such as New York and San Fransisco based on the company’s positive experience of the city’s business friendly environment and many business opportunities it has to offer.