“Ultimately, this is about creating value for society as a whole. New businesses create jobs, generate export earnings, and strengthen economic competitiveness.”
Svanhildur Nanna Vigfúsdóttir, Chair of the Board of The New Business Venture Fund Kría, was interviewed by Viðskiptablaðið on June 23. The interview focused on how The New Business Venture Fund Kría aims to strengthen Iceland’s innovation ecosystem by bridging the gap between entrepreneurial ideas and financing, particularly during the early stages of company development, in order to create long-term value for Icelandic society.
The year 2025 marked a milestone in Iceland’s innovation landscape when The New Business Venture Fund Kría began operating in its current form following the merger of the Innovation Fund of Icelandic Industry and Kría, the Startup and Innovation Fund. According to Svanhildur Nanna Vigfúsdóttir, Chair of the Board, the fund’s first year was both a period of consolidation and growth, during which the foundation was laid for its future operations.
The fund’s annual meeting will take place tomorrow, Wednesday, June 24.
Asked what stood out most during the fund’s first year, Svanhildur said that the organization had successfully brought together two important funds under one umbrella, creating a stronger and more cohesive entity.
“The merger gave us the opportunity to build a stronger platform that combines experience, expertise, and investment capacity, enabling us to provide even greater support to Icelandic startups and innovation-driven companies,” she said.
At the same time as strategic planning and organizational development were underway, the fund continued its activities at full pace through investments, support for the innovation ecosystem, and the development of partnerships with investors and other stakeholders.
Strategic planning played a major role during the fund’s first year. Svanhildur noted that when a new fund is created through the merger of two important pillars of the innovation ecosystem, it is essential to pause and ask fundamental questions about its role, purpose, and priorities.
The Board and management therefore placed significant emphasis on strategic planning throughout the year.
“We engaged with a broad group of stakeholders from across the innovation ecosystem—entrepreneurs, investors, and partners—to gain the clearest possible understanding of where the fund could have the greatest impact,” she explained.
This process helped further define Kría’s role and how the fund could best utilize the capital and tools entrusted to it. Svanhildur added that considerable emphasis was placed on professionalism in investment decisions, transparency in operations, and maximizing the societal impact of the fund’s investments.
According to Svanhildur, Kría’s primary role is to address opportunities where the market alone is unable to meet financing needs.
“Our role is to support innovation at the earliest stages, activate private capital, and strengthen the financing environment as a whole,” she said.
She described the fund as an important link within a broader innovation ecosystem.
“We are not an isolated investor but rather a partner to other investors, accelerators, funds, the research community, and others working to strengthen innovation in Iceland.”
The objective is to help more promising ideas grow into strong companies that generate long-term value, jobs, and export revenues.
The fund’s annual report highlights a particular focus on early-stage innovation. Svanhildur said the reason is straightforward.
“This is simply where the need is greatest. In the early stages, companies often have strong ideas and capable teams but limited access to capital. Without funding at this point, highly promising projects can simply come to a halt.”
She noted the strong momentum within Iceland’s entrepreneurial community, reflected in the significant interest shown in Frumsjóður 25 and other initiatives supported by the fund.
Such projects demonstrate that there is no shortage of ideas or ambition. The challenge lies in ensuring that those ideas are given a realistic opportunity to develop further.
During the year, proposals emerged suggesting that The New Business Venture Fund Kría should be dissolved as part of government cost-cutting measures. Svanhildur said it is both reasonable and necessary to regularly review the role of public funds and institutions and evaluate whether they are achieving their intended objectives.
“Such discussions are both necessary and healthy,” she said.
However, she emphasized the importance of distinguishing between operational cost savings and asset sales. The public debate had referred to potential savings that could result from selling the fund’s assets.
“The fund’s assets are investments that have been built up over a long period of time. Selling them would not create permanent savings but would simply convert assets into cash. At the same time, it would mean giving up future returns and the societal impact those investments can generate.”
Svanhildur argued that the key question is therefore not whether the portfolio can be sold, but what effect such a decision would have on the innovation ecosystem.
Kría’s role is to address financing gaps in the earliest stages of innovation, mobilize private investment, and support the creation of new businesses—areas that markets do not always address on their own.
“I believe it is important to view the fund as a long-term investment in the competitiveness of Icelandic industry rather than as a short-term budget item,” she said.
She noted that Iceland’s innovation ecosystem has made significant progress in recent years, with more experienced entrepreneurs, more investors, and stronger support infrastructure than ever before.
At the same time, competition for capital, expertise, and talent has become increasingly global.
“That is why we must continue strengthening the ecosystem as a whole. Innovation does not emerge in a vacuum; it is created through the interaction of entrepreneurs, investors, universities, the research community, industry, and the public sector.”
When asked about future opportunities, Svanhildur said they lie in the human capital and expertise that have been built up in Iceland over recent years.
She highlighted health technology, software, creative industries, sustainability, and deep tech as sectors where particularly exciting developments are taking place.
She also pointed to growing investor interest in innovation as an important positive trend.
“When public capital and private capital work together, greater momentum is created and more opportunities become available for companies,” she said.
Svanhildur’s vision for the future is for Kría to become an even stronger catalyst for innovation in Iceland. The fund should serve as a trusted partner to entrepreneurs and investors while helping more Icelandic companies achieve international success.
“Ultimately, this is about creating value for society as a whole. New companies create jobs, export revenues, and increased competitiveness. It is an investment in Iceland’s future and a mission that matters to all of us,” she said.
She concluded by stating that the ultimate goal is to help create a self-sustaining innovation ecosystem—one in which The New Business Venture Fund Kría itself is no longer needed.
