Laura Strömberg of Dagsmark Petfood, a Finnish manufacturer of dry dog food, and Minna Oksa, a lawyer from PwC, know that an entrepreneur does not have to be knowledgeable in everything and know how to do everything themselves. It is reassuring to get help from professionals of other fields when it comes to contracts, finance, tax matters and going out into the world.
“Our business idea was based on the observation that there was no domestic dry dog food on the market. We thought that there must be others who want high-quality food made in Finland for their pets. We formed the idea together with a team of five people with a background in foodstuff and an entrepreneurial spirit,” says Laura.
Everything happened extremely fast. The idea was born in the summer of 2016, and the first products were in stores in August 2017.
“The first two years were stressful because we didn’t have an organization and couldn’t afford to hire people. It was a surprise how hard it was to get everything started. I had previously thought that production would start at the push of a button.”
Laura learned that schedules stretch, and money always runs out. But because they had a strong belief in the project, they pushed forward. Already in the first autumn, they noticed that the machine, which was already operated in three shifts, did not have suitable capacity. The entrepreneurs were unable to meet demand.
“We needed external investors, and we did a €600,000 funding round. Our team already had contacts with investors, but the paperwork and the law regarding the financing round required an external expert. PwC handled that side completely. PwC was also involved in the second round of financing, €1.5 million.”
PwC has a wealth of experience in growth business customers.
“Getting funding is one of the typical situations where we come to the rescue. We also provide tips on where to go for funding. In addition to funding rounds, start-ups and growth companies often need our help with contract matters, company law matters, tax issues and M&A. It is also really important from the perspective of potential new investors that commercial agreements, registration entries and other documents are well managed in the company,” says Minna.
The importance of the legal expertise of external experts is important for many growth companies as the company and its volumes grow.
“We have helped our customers, for example, in negotiations with potential partners, in entering the first major contracts with customers or suppliers, or in making larger investments. We have also been involved in drafting the general terms and conditions, negotiating the introduction of new shareholders in the company, and considering key personnel engagement,” says Minna.
In addition to legal and tax related issues, Laura and other founders have been assisted by PwC’s auditor Jukka Kokkonen.
“We also pay attention to the work of company boards. Many attempt to survive for a long time with a founding team that often consists of people with very similar set of skills. It is said that a good team is what matters, but often what matters is not a team or even a good idea but the fact that the team has a variety of skills. In my opinion, that is the best guarantee of the company’s success,” says Minna.
Dagsmark Petfood is a great example of growth companies outside of technology and gaming.
“Laura was at our client event telling their story because we wanted to highlight a slightly different example. The founders all have a passion and a deep affection for dogs. You can turn your hobby into a business,” Minna says.
“The people at PwC are now familiar to me. In addition, I can call the auditor, for example, and ask for advice. He also guided us in choosing a suitable accounting firm. PwC’s experts know our situation. We also get tips from them on what issues should be addressed in the board at a given time,” Laura thanks.
I don’t try to do everything myself. Instead, I want those who know how to do things the best to handle them.
“Good partners are crucial to us. Different skills are needed to expand a company. I don’t try to do everything myself. Instead, I want those who know how to do things the best to handle them.”
“Since I have been involved in the company from the beginning, I have seen the close calls of entrepreneurship up close. Money often runs out and everything takes more time than one would like. In general, however, entrepreneurs themselves still have a strong belief in their own business idea and future success. This belief helps in overcoming challenges. Once the biggest challenges of the start-up phase of the company have been overcome, you can tell when things start going smoothly by the entrepreneur’s demeanor,” Minna describes.
Dagsmark Petfood currently employs eight people and its turnover profit will rise to more than four million this year. The company is doing well and expanding into cat food.
“Initially, we planned to only operate in the domestic market, but the intention is to expand to exports as well. We believe that pure Finnish antibiotic-free pet food is of interest elsewhere as well,” says Laura.
The pet market is more forgiving compared to many other industries. It is not cyclical. This was evidenced, for example, by the recession of the 1990s. And in the corona spring, people queued up for puppies.
Text: Kirsi Riipinen