A Brilliant Mind: Innovating the Future of Business from Sweden

What does a happy, creative society look like?

If you ask President Obama, it's one steeped in values of equality, social responsibility and collaboration. It's one that's proficient in gaming, music streaming and has striking topographical similarity to the Game of Thrones.

"Yes I really do believe it, the world would be more secure, more just and more prosperous if we just had more partners like our Nordic partners," President Obama said last Friday at the opening ceremony of the historic Nordic Leaders Summit in Washington, D.C.

The Nordic business model challenges us, as Americans, to imagine what could be a better future for ourselves- a future that empowers all individuals, men and women, to have the opportunity to succeed, have families and have a meaningful professional calling that gives back to society.

This is precisely the ultimate mission for the most successful business family in the Nordics: doing good for their country, Sweden, and sharing that social good and impactful innovation with the world.

The Wallenberg name is spoken with respect in the corridors of Washington, D.C. thought leadership circles, and financial centers from New York to New Delhi, Tokyo to Cape Town. The family has a 160-year-old legacy in long-term, conscious investment and a major funding base for research. The three cousins-- Marcus, Jacob and Peter Jr.-- lead a 250-billion dollar business empire composed of the world's most forward-looking companies like Ericsson, Electrolux, ABB and AstraZeneca.

What the Medicis were to Renaissance Italy and art, the Wallenbergs are for Sweden and the future of business.

Where many long-held family companies falter into conventional groupthink and lack a fresh entrepreneurial verve in their leadership, Marcus Wallenberg, the Chairman of SEB Bank, adheres to a letter his grandfather wrote to his brother Jacob some 70 years ago.

"The only tradition worth keeping, is to go from the old to what is about to come".

As the Chairman of the family's first venture founded in 1856, SEB Bank, SAAB and FAM and board member of, AstraZeneca, Investor, Temasek Holdings and the Knut and Alice Wallenberg Foundation, and advisory board member of Symposium Stockholm, Marcus's leadership represents a rare breed- one that seamlessly marries the old and the new, openness and tradition, with authenticity and values.

Read more about the future of innovation and how Sweden symbolizes this future in the interview below with Marcus Wallenberg. This is the fourth in a series on business disruptors called "A Brilliant Mind".

Natalia Brzezinski: "Swedish values" have been lauded in the press with the President's Nordic Summit serving as the apotheosis: What does it mean to be Swedish? What does it mean to be a Wallenberg of Sweden?

Marcus Wallenberg: As swedes, we have it in our DNA to be out in the world promoting our products and services. To compete internationally from day one, you need to have a strong sense of curiosity, be able to reach understandings (our consensus culture), but also have a firm view on how you make the best products and services through innovation.

Our strength may not lie in competing in volume or low labor cost. So we need to be innovative in order to be delivering the best performance and attractive prices.

I think the same goes with our family. My grandfather wrote in a letter to his brother Jacob some 70 years ago arguing for the family to leave shipping and move into aviation that, "the only tradition worth keeping, is to go from the old to what is about to come".

To me that says a lot of what we as a family have always been trying to do. We have now been in business for 160 years and we hope to stay around for a long time. But it's all about cherishing and working with your values, as you constantly look into to the future and try to adapt to what is coming.

The Economist pronounced on its 2012 cover that "Sweden has reached the future first", is that true?

I believe Sweden is in a good position with many positive things going for it. As a small export-oriented country with a tiny home market, we've been able to compete internationally with our existing big companies, but also stay in the forefront in the startup sector, thereby creating companies for the future.

However, we also face the harsh international competition for investments, talent, and ideas. We certainly have a number of measures we should take to further strengthen Sweden as a world-class breeding ground for entrepreneurs.

What can the world learn from the Nordic model? And what can the Nordics learn from the world?

The Nordic model has helped us build a market economy where companies can blossom, where people largely feel we have a stable welfare sector providing for everyone's basic needs. That's something to be proud of!

I think we have an inclusive society with opportunities for anyone with ambitions to make it. We have an education system that is free and open for all and we have large portions of our population highly educated. I also think we have a creative mindset and a culture of being able to collaborate.

However, Sweden need to be more accommodating to new types of companies and ideas and new ways to build a business. We have somewhat of a regulatory mindset, with the government having strong impact in all parts of the society. This tradition cannot stand in the way of individuals and entrepreneurs to pursue new innovative business ideas and ventures. We must allow for, and reward, risk taking. That has not always been our strong side.

I think we constantly have to learn from the world around us. If we stop listening and learning we will never be able to compete and adapt in the long run. Our family has always put a lot of time and effort into building our international network, and one of the key reasons for doing so is the opportunity to learn from others.

Sweden has 0.14 percent of the world population. I think that says it all. We need to be out there to share and learn. Constantly.

Media likes to portray Sweden as a utopia, but it's certainly not perfect. What must change in order for Sweden to remain competitive?

Sweden must continue to be in forefront of nurturing ideas that can become companies and that create jobs - and keep them Swedish based. To do that we have to listen to what the entrepreneurs of today require in order to be competitive on a global market. Also, given our strong base of established blue chip companies, we need to make sure they're in the front of new technology and disruption happening at an increased speed.

Politics need to adapt to the new companies that we see emerging. The sharing economy might need us to review policies. We cannot be scared of what is to come. We need to make sure that we have the absolute best conditions for our entrepreneurs and our companies. That means we need to develop our education system, our housing situation, infrastructure and tax system to name a few. A country needs to develop all the time. If we don't, we will be run over by the international competition.

As a fifth-generation family-related company your shoulders must be heavy with tradition and expectations, is it possible to marry an entrepreneurial approach with a tradition of big business?

I truly believe it is. For us as a family it's key to make sure we attract the right people to work with us and that we in turn create the best possible breeding ground and climate for risk-taking and for innovation. In order to accomplish that, it's important to be involved in both business and research funding.

We also work actively to deepen the collaboration between businesses and the research community in Sweden. For Sweden as a country, it will be key to stay competitive in selected technology and research areas.

One of those research grants we made is the Wallenberg Autonomous Systems Program (WASP) launched last year. WASP is Sweden's single largest individual research program, and provides a platform for academic research and education, fostering interaction with Sweden's leading technology companies. The program addresses research in the area of autonomous systems acting in collaboration with humans, adapting to their environment through sensors, information and knowledge, and forming intelligent systems-of-systems.

Some of our companies that we have owned for very many years have, through research and active ownership, managed to innovate and renew their products and their way of working to adapt to the new conditions that companies face today. Our tradition of long-term ownership of our companies has been of great importance in that process.

I believe that this is the essence of how we work with our companies - learning to constantly reinvent and thereby adapt to new challenges and the new world that we are entering.

Is Sweden a FinTech leader?

Sweden has a large economy and deep knowledge within this sector. We have the technological knowledge and competence, but also the business knowhow. You need that to be globally competitive, and I believe Sweden has shown leadership here, with several successful FinTech start-ups and scale-ups.

Do you think the Swedish ethos of modesty and "not standing out" is a strength or a weakness?

I think that there are different ways of standing out - Sweden still stands out, in a demure and honest way. That authenticity is a great strength!

However, we do see a new generation of Swedes entering business. A generation that is neither shy nor modest and that leverages that to get proper attention. Our culture makes us good collaborators, which in my mind is a key trait in order to be successful within innovation and business.

Is Sweden really as gender equal as we all think? Why aren't there more female CEO's and especially female founders of companies?

That's something we're working on constantly to improve. We've increased the number of females in top positions in our holdings and we're almost at 40% women on the boards of the companies where we have ownership interest.

However, more needs to be done, not the least at the management level at the companies. At the end of the day it's about using the entire talent base available and be wise about how we use our resources in the best way. We also have a challenge in including the new Swedes in our labor market and into to top positions in our businesses. Adding that extra dimension to our talent base, will add valuable resources to our economy and society. Diversity is the core of innovation and creativity!

What did you learn about the legacy of your uncle Raoul Wallenberg-- the famous Swedish diplomat who saved tens of thousands of Jews in Hungary during WWII-- growing up? How did his story impact you?

We spoke a great deal about the accomplishments of Raoul Wallenberg and his tragic fate as children. He's an inspiration to our family and to many others for the courage and compassion he showed. He was a true leader that had to make the ultimate sacrifice. He reminds us that we all can make a difference.

What do you want your legacy to be?

I try to be a useful force for the businesses we're engaged in, and ultimately for Sweden. In the statutes of the largest Wallenberg Foundation the world "Landsgagnelig" points at the ultimate mission; doing good for the country of Sweden.

In my generation of our family, we wish to support those in the 6th generation to learn more about the business, guide them in their career choices, and to one day hopefully see some of them becoming passionate about continuing the family tradition.

What's unique about the "Wallenberg" way of doing business? What's the secret to your success?

That really is a difficult question to answer as we are now in the fifth generation spanning 160 years down the line of supporting companies and researchers. Having said that, I believe that our ability to work to achieve the best long-term strategy for the holdings through an engage ownership model is important. We aspire to achieve financial strength and flexibility.

We have been through a number of tough times over the years and we know the importance of having liquidity and financial muscle. We've always tried to gauge the situation through international travels, and to build and further our network. Openness and dedication must be a part of our longevity. And at the end of the day, it's all about finding and working with the best people.

What do you hope your children have learned from you?

I hope that they have learned to pursue what makes them happy and what's in their heart, and not to listen too much to what others say. I hope they will follow their "own true north" and work tirelessly to achieve their dreams.

What is the meaning of collaborative creativity to you?

It's the ability to breach the boarders between business, science, arts, music, fashion and other areas - to be inspired and learn from how other people think, work and create.

To me, being a good business leader also means to be creative, and we also need to be inspired from success and advances in other sectors. I think that we will see much more collaborations between traditional business and more creative areas in the future.