– It was a good match; he had a clear product vision, and I had a clear business vision! From there, it has been a crazy journey to get to where we are now.
In the office at Media Evolution, Magnus Hultman describes his first meeting with Johan Unger, one that led to the birth of fast growing startup business Sprinkle in the spring of 2013.
Magnus Hultman with Johan Unger outside the office at Media Evolution.
Magnus and Johan outside the office at Media Evolution.
CEO Magnus Hultman describes himself as offspring of the Framfab era. He participated in the launch of Instadia in Sweden, a disruptive company focused on web statistics that made a mark in several industries and was sold to American business Omniture, now better known as Adobe. Magnus then carried on as founder and CEO of Smartclip Nordics, and as an angel investor.
Johan Unger, on the other hand, is the young entrepreneur who, while studying, was one of the founders of Qulart. He already had a clear interest in helping users to find quality online content, and with Magnus’ experience and investment opportunities, they could develop Sprinkle.
Creating user-based content
The startup offers a widget that websites put below their posts, recommending suitable content to the user. The recommendations are based on criteria such as what is popular, what the visitor has clicked on previously, and what is trending on social media. The primary source of income is sponsored content, and partners include Disney, Red Bull, HBO, Showtime and ABC News.
– The site itself gets more hits, more return visitors clicking on more ads, and the publicisers get more use for their content, including that from the archive. That is particularly important now that editorial resources are dwindling for all newspapers and media conglomerates, says Magnus.
Sprinkle has created a widget for websites to help maximise content and make the visitor want to stay on the site.
Challenges for a growing startup
It’s full steam ahead for Sprinkle. The operations generate 600 million recommendations, and a turnover of over half a million SEK per month. They have 13 employees in Malmö and Stockholm, and a recently opened office in Oslo.
– We actually started in Stockholm, but had a mega problem with recruitment, explains Magnus. The large companies hoovered the market for developers, and created sky-high starting salaries. So in order to be able to develop the product, we decided to move all development to Malmö. Skåne is an extremely technology intensive region, and it is easy to find good developers. King did the same; they couldn’t develop in Stockholm, so they opened an office here in Malmö.
Sprinkle's office is located at the innovation arena Media Evolution in Malmö.
Sprinkle sits in premises belonging to Media Evolution, the media industry’s innovation arena, and is making plans for further recruitment. It has also entered an international round of investment, and has just brought in main investor Spintop Ventures, which entails an investment of 1.1 million euro. A dream investor would be a large, global media name, like Oprah, muses Magnus.
That aside, foreign expansion is by far the most important challenge right now, he says:
– In an industry as dynamic as media, with its extremely fickle behaviour, we have to work a little bit smarter than everyone else. We aren’t content with being the biggest in Sweden and the Nordic countries; we want to be the biggest in the world.
Local networks and international investors
Important people from Malmö’s startup scene Johan mentions Malmö Startups, which has created an open climate with entrepreneurs helping each other, and an open source way of thinking. He also mentions Benjamin Page and Michael Hoy from Invest in Skåne, business developers who split their time between the region and the office in Silicon Valley.
– We were at Nordic NEXT, incredibly well done! says Magnus. Even the investor from London thought that it was of an international standard. What they do will generate investment here.
What is needed to attract more investment to the region?
– More people engaging in building a startup community, with meetings and events, says Johan. But it has to be done bottom-up.
Magnus believes in supporting initial financing to prove the validity of an idea, and helping with research to see what market potential there is in a certain area.
Johan says that it is important to introduce development early in schools, at ages 10-12.
– And say that young entrepreneurs can come to us if they want any help! he adds.
