[ 00:00:00 ]I knew that my daughter is going to be asking me some difficult questions someday. ‘Dad, what did you do during the climate crisis?’ We’re aiming to create one million new cyclists during the next decade. What were they thinking? The stories behind Europe’s most promising clean mobility startups. Hello, my name is Dan Sobovitz, and in this new podcast, I’ll be talking to some very successful startup entrepreneurs. Women and men who are disrupting mobility as we know it – making it more sustainable and more inclusive, both for their passengers and for their employees. In this podcast, I won’t be asking them about their pitch decks or their growth rates or their shareholder models. I’m much more interested in what were they thinking. How did it feel to go the lonely road of an entrepreneur?

 

[ 00:00:44 ] Did people follow them easily or did they think they were crazy? Was it fun all along or mostly frustrating? And deep down, did they really believe they were going to make it this far? My first and brave guest in the studio today is Mikko Ampuja from Finland. I’m trying to pronounce it in Finnish. And that’s also, by the way, where we’re recording this episode here in Helsinki. You’re the founder of Vapaus, a company that’s offering flexible employee bike services. So, hey, Mikko, it’s great to have you or great for you to have me in Helsinki. Thank you very much. Nice to be here. It’s white and peaceful outside, but you warned me before I came it was going to be minus 18. It’s actually not that cold. Yeah, no, no, it’s nice and easy.

 

[ 00:01:20 ] Minus 18 is actually not so bad as it sounds. So there’s always room for colder. Yes. So, before we talk about Vapaus, I’d like to ask you about your life before you founded Vapaus. What were you doing before Vapaus? I basically spent like 10 years doing consultancy for larger corporations as an employee, yeah, I worked in a research agency. I started as a sales guy, ended up as the CEO, also in that company, but basically as an employee. Yes. But then something was missing. Yeah, I did that job for approximately 10 years. And most of it was really interesting, actually, especially in the start. I kept on meeting like new, interesting people; really super smart people working with the best corporations in the world, doing really interesting and challenging jobs – how to create new products, how to enter the market, how to do marketing, and all that.

 

[ 00:02:10 ] But still, something was missing. Yeah. After five years, it kind of came to the point where, in a meeting, I could really like think that, I think, I know what this guy is going to say next. And at some point it became kind of annoying because I started becoming right; Like they actually said what I was thinking that they’re going to say. Then, obviously, the second thing was that, you know, as you work as a consultant, you can’t really choose that you who you work for unless you’re like this global superstar. So, you end up working for industries or projects that you honestly you don’t really believe in. You don’t believe in because they will succeed or don’t believe that they are actually making a positive impact in the world.

 

[ 00:02:50 ] Yeah, exactly. The positive impact in the world, because normally when you like you’re working in your day job and everything is going fine, you’re like meeting nice people. People work with nice people. It’s all good. But, you know, everyone knows that life doesn’t work that way. You have your ups and downs. And especially if you’ve been working hard for a long time, maybe you’re like overworked. You really start questioning that. Why am I doing this? Is it really worth my time investing into something that I don’t really believe in? And the answer was no, it wasn’t worth the time. Yeah. In the end, it was no. There was specifically. The moment when my daughter was born in 2017 was like a pivotal moment in my personal life.

 

[ 00:03:40 ] I was holding the baby in my arms and I was really thinking that, you know, first of all, I want to be a good dad at home. And the second one was that knowing all the challenges that the world is facing right now with the global warming, what’s happening with people’s health, all that. So I knew that my daughter is going to be asking me some difficult questions someday, such as ‘Dad, what did you do during the climate crisis?’ And I really wanted to have a good answer for that. What’s going to be your answer? I’ve definitely done my best. We founded Vapaus. So we’re like making the threshold of cycling lower and lower for tens of thousands of people right now. We’re aiming to create like 1 million new cyclists during the next decade.

 

[ 00:04:27 ] So. I can definitely say that at least I have tried. I’ve tried my best and actually so far with some success also. So basically you left the consultancy, you started this company. Maybe before you explain to me how this works, how did people around you react? How did your wife react when you told her? I mean, you just became a father, so you wanted a meeting, but I presume you also wanted stability and you wanted security. First of all, I had discussed the topic of entrepreneurship with my wife. And she’s always been like very, very encouraging; she doesn’t care about money at all. So that’s a good starting point for entrepreneurs’ life. And, you know, she just wanted me to be happy and, you know, support what I’m doing.

 

[ 00:05:10 ] And so getting the support from the wife was really, really important in the beginning. I worked in a small company. I almost always liked selling my own projects. I did my own projects. I was the CEO. So honestly, what was like the risk of actually jumping into entrepreneurship? It wasn’t, it isn’t as big as some people think it might be. So the risk wasn’t huge. Your environment was supportive. You were looking for a meaning and you found that meaning with a new concept, which was how to, as you said, lower the threshold for employees so they can bike to work. So I promise the listeners not to go too deep into the business model. But still, how does it work? What are you offering? Basically, what we do is we offer these called benefit bikes.

 

[ 00:05:53 ] So it’s like a company car, but it’s a bicycle. So it’s offered by the employer to the employee as a part of their compensation package. And it’s becoming really, really popular all around Europe right now. There’s like 150 million people living in areas where there is this concept of a bike-to-work benefit. So it’s like a company car, but I think it’s better. And I presume you came here by bike now as well to the studio? No, I walked today. I live in Tampere, so I took the train and then I walked from the train station to the podcast studio today. But you also bike to work, I presume? Yeah. Well, I try to do everything that is like less than five kilometers by bike. So it’s basically the best feeling you can get in the morning.

 

[ 00:06:37 ] You get some fresh air. You actually feel the freedom. Vapaus, it means actually means freedom. So you get that feeling in the morning. You don’t you’re not stuck in the traffic, but you’re just enjoying enjoying life. I know a lot of people think that it’s crazy to cycle in the winter, but it’s actually fantastic. Well, for me, it was difficult just to walk on the ice. I don’t know how you guys can can bike on the ice, but I’m sure it’s a matter of habit. To go back to your story: So you leave your comfortable life. Your wife is supporting you. Your daughter is one day going to admire her daddy. But when was the moment that you realized that this was actually going to work, that this crazy idea was actually going to become a successful company?

 

[ 00:07:15 ] I still remember that moment really well because we’ve been working hard on the product for a long time. And especially, we had been working with this one large corporation in collaboration with them, trying to co-create the product. The service, actually, that was part of the sort of like binning process. But we were like really involved, having like long discussions and workshops with them about how to how to create the product. And then came the day when they basically announced that this 5,000-person corporation is going to choose their vendor. Where were you when they gave you the news? I was in the middle of forest in this cottage with my friend. So make it more Finnish cliche in the middle of the forest. I’m imagining snow. Yeah, we have decorations. Sauna.

 

[ 00:07:58 ] Sauna, of course, sauna. So you’re in the forest and what, they give you a call? No, it’s actually our head of sales called me that day. So this is already a few years into the company. Yeah, yeah. It was 2020 actually. Lasse Keronen, our fantastic sales lead at that point, gave me a call. And I was literally jumping all over the cottage. And my friend, he didn’t get it like, what? So what? You get one customer. He was working in a huge corporation at that point. So he really didn’t get it. But why was it so meaningful, this one client? It really proved that there is a demand for the product that we’re working on. And I think the huge bets that we also took in the beginning were really paying off.

 

[ 00:08:41 ] Because, in leasing, usually what we also provide, you do normally like quite long contracts – three, four year contracts. Even for bikes. Yeah. And the thing is that in modern working life, three years is kind of a long time. Mm-hmm. Are you going to work in the same place? You don’t know. And from the organization’s point of view, are you going to have some organizational restructuring or so? Mm-hmm. Most likely. So we made it super easy for our customers to return the bikes. You don’t have to commit to the three-year contract. You can take the bike and you don’t have to worry about the fact that ‘are you’ going to still use it in like one or two years. So, that makes you unique in the market? Yeah.

 

[ 00:09:21 ] It also comes really down to our values. From, like, a pure financing point of view, it doesn’t really sound too tempting to have like an exit clause in those contracts. But since we really founded the business on the ideas of sustainability and circular economy, I’m not happy, you know, if you take a bike and then after a year you don’t use it. It’s in your basement. Mm-hmm. Why should it be there? That’s stupid. So, your idea is basically both the company and the employee can change their minds. Yes. And you’re basically bearing the risk. Yeah. And of course, it also creates us with a huge incentive and the motivation to push that you take the bike, but you also use it afterwards.

 

[ 00:10:01 ] So, we really, really try to help you get a quality bike, get a bike that fits your need. Then like, help you with different content to actually keep you cycling. And we’ve been really successful in that. So I’m really happy about our positive impact. So once everybody gets on stage, the Vice President let us thank. All right, so as everybody’s making their way to the stage, thank you. I should also mention that the startups participating in this podcast are those who won this year’s edition of the European Startup Prize for Mobility, which is Europe’s largest acceleration program for clean mobility startups. The Startup Prize is a private public initiative bringing together all major EU institutions, national authorities, philanthropies, and multinational companies who jointly scout, rank, and boost Europe’s most promising clean mobility startups.

 

[ 00:10:48 ] This year, we received over 700 applications from mobility startups all across Europe. We went through a rigorous selection process; both written and in front of a professional jury. I say we because I happen to be managing the prize. The prize connects them with its partners for investment and partnerships, presents them to VCs and CVCs, and provides them with visibility all across Europe. We’re actually recording this episode here in Helsinki as part of the winner’s tour, which brought them to Slush. For you, it wasn’t a big trip; You’re actually from here. And I should tell the listeners that if you would like to learn more about the prize, you can visit StartupPrize.eu. Thank you, Dan. Thank you, Mario. Thank you for all the team, for the European Parliament. And thank you for the team, yeah.

 

[ 00:11:29 ] For the production team. Who else do we need to thank? The Brussels Times, you said. So as I mentioned, you’re from Finland where we’re recording this. But in the U.S., we often hear about the ‘valley of death’, a major leap startups need to make in order to get their cash oxygen to survive. What was the experience like for you here in the Finnish and the European environment? For us, I think one of the most difficult moments was actually when we realized that, hey, this is a business. This is really taking off. So the growth was really like the difficult part. Once we actually found the original product market fit, the company started growing tremendously. And the bikes that we deliver are quite expensive. The average price is around like 3,000 euros.

 

[ 00:12:11 ] How big were you becoming? Just give us an idea. In the first months, we delivered like a few hundred bikes. Doesn’t sound too much. But if the average cost is like 3,000 euros, you suddenly realize that, hey, I’m missing €300,000. The next month, you delivered one like 1,000 bikes, right? And today, we’re like around like 20,000. Wow. It was really at the same time, like super exciting that, you know, there’s this huge demand, but at the same time, realizing that how much cash this like business is really like sucking at that point. And those were like super difficult moments for us when the growth started like exploding, really. And at the same time, you know, we had the salespeople talking to the customers.

 

[ 00:12:54 ] Me and my co-founder, Tatu, we were talking to investors that, hey, it’s really taking off. We need all this cash to actually to run this business. And at some point, it became super painful because we realized that we actually had to close down sales. We can’t take in any more customers because we can’t afford them. And it all became like a huge shock to the company because we already liked, so the whole startup story, you know, has kind of like sunk in that, hey, it’s like a rocket-like growth all the time. But sometimes it was so painful to just to try to control the growth. So it basically means that you were not profitable. So every new client wasn’t generating profit. There’s a difference between profitable and having positive cash flow.

 

[ 00:13:37 ] So, we weren’t like we were like negative cash flow because first we need to pay for the bike and then the actual income goes towards those leasing fees. It becomes like during the next three years. And no, we weren’t profitable either because we are investing in tech and all that. But it actually became so painful that our like one of co-founders who was leading the sales front decided to exit the company. And of course, that was really, really painful moment for everyone. So, are you out of that zone now? We still need to control the growth, but we’ve managed to close like a huge debt financing solution. So, we’re in a lot better situation right now. But with more money, we would grow even faster. So, that’s always frustrating.

 

[ 00:14:24 ] You wrote to me before this conversation that a tax official almost pulled the carpet underneath your business. They were doing a ruling that would destroy 95 percent of the market size. Yeah, that was intense. That was an interesting moment. Actually, what happened was that this one reporter was making a story about about the market and also about Vapaus. He called me on a Sunday and he said that, yeah, he’s been talking to us. But he also talked with this tax official. And then. And the tax official was saying that actually everybody in the market has misunderstood the tax benefit. And it’s kind of technical. But according to the tax official, you can also only put it on top of the salary, not part as part of the total compensation, which was very, very, very small part of the employees.

 

[ 00:15:18 ] Employers were actually giving it on top of the salary. Most were doing it as part of like total compensation. So that basically hinders the entire business model. Yeah. At that point, I really calculated that less than five percent of our customer base was doing it on top of salary. And that would have been a deal-breaker for them. Yeah. Overnight, 95 percent of the whole business would have been gone. And I learned about this from a journalist. Yeah. Yeah. I really thought the journalist understood something wrong because it can’t be. So he’s telling me this. And then what do you do? So I had to wait until Monday to call the tax guy. It was over the weekend. Yeah. So. The journalist called me on Sunday.

 

[ 00:15:55 ] So, I called the tax office on Monday and said, ‘Hey, I heard this from the journalist, but it can’t be true, is it?’ But yeah, he confirmed that. No, it’s the tax office. Like, interpretation of the of the law is that you can only do it like this. After the call, I literally had to sit down on the floor of my office for like 10 minutes. And think about it: that hey, we’ve just hired all these people. We’ve just, like, managed to close all these clients. If this happens, I have to fire all those people. Well, I have to tell all those customers that they knew regulation, so we can’t do it. Those days after that were definitely like the most intensive days I’ve ever experienced. What were you doing?

 

[ 00:16:46 ] What was intense emotionally? Or were you running around Helsinki and talking to people? No. First, first, of course, like, emotionally. But. I seem to be the kind of a guy who gets fired up for, like, in difficulties; I get bored if things aren’t too easy. But so what we did was: I basically rallied everyone in Finland who had been, like, supporting this policy change in Finland to about the bicycle benefit. So I called the cyclist union. We called the Chamber of Commerce. I called all the officials in the ministries and all those people about that. What’s what’s happening here? How did they react? I think the government here tries to react neutrally to everything. Okay. But then I called, like, everyone who’s been, like, supporting the policy.

 

[ 00:17:34 ] They were like, ‘No, you can’t do it.’ Like, ‘You have to have it like part of the total compensation.’ It’s they were really thinking that now the tax office is making a huge mistake because they would basically ruin the positive impact that was like trying to be achieved by this bike benefit. Yeah. I called all my competitors, because obviously it’s like a shared cause. And so they started calling everyone, meeting everyone. Do you have some kind of an association or a union? Yeah, there is a cyclist union. So they’re probably the like the best partner we had in this cause. And it was 48 hours of super intensive lobbying. And by the end of Wednesday, we got there. Just to summarize, I left my comfortable job. Your wife supports you.

 

[ 00:18:23 ] Your company is doing well. You’re hiring people. You get thousands of employee benefits in clients who are leasing your bikes. One day, you discover through a journalist in a random conversation over the weekend that a new interpretation of the law basically puts your entire business model at risk. And now, between Monday and Wednesday, you’re calling everybody you know in Helsinki to try to change that interpretation. Yeah. And? End of Wednesday, we get the new interpretation from the tax office. Hey, you were right all along. We will continue doing this. How did you celebrate? You went to sleep? Yeah, I’m super bad at celebrating stuff. I was like, ‘yay’, fantastic. And then next problem. We’re going to work on your celebration skills tonight when we are going to slush together.

 

[ 00:19:12 ] But OK, but that must be an intense experience indeed. What did you learn from it? I mean, if you had to do it all over again? I’m kind of surprised. I think we did like a year. It was like a stellar job with the effort. You discovered you were a lobbyist as well deep down. Yeah. Not just an entrepreneur. Yeah. When it comes to like the passionate subjects indefinitely. I think what I really learned from that is that find the people who support your cause, even if they are competitors, and you can do great things together. So, your competitor is not always your competitor. Sometimes it’s your ally. Yeah. I have to really, you know, thank my fantastic competitors here as well. So, thank you. Thank you, Cowboy Bike.

 

[ 00:19:52 ] Thank you, Fleet Innovation. Thank you, Etu Fillari. Well, I think only in Scandinavia this could happen. But you would mention the brands of your competitors on the podcast. So, well done. But that leads me maybe to my final question. So imagine that instead of me sitting here in front of you in a studio, I could put your Miko of 2013 younger, less experienced, maybe even more eager. What’s the best advice you would give your younger self? Maybe I should have started with the business a bit earlier because I’d like to thank my like previous competitors. Previous job, even earlier, I mean, I should tell the listeners that. You look, I don’t know how old you are, but you look young. He’s sitting here with a jumper, a T-shirt with a of course a bike on it drawn on it, and jeans.

 

[ 00:20:32 ] And to me, you look what, early 30s? Uh, I’m like 44. You’re 44, yeah? What do they feed you here in Finland now? Well done, okay? So, and you, you started how old were you when you started the business? Maybe 40? Okay, four years ago, and you’re saying that you would have wanted to start earlier than 40? Yeah, because um, my previous job was really good in that sense. That I got like huge amounts of responsibility. I was doing sales; I was doing the custom work, and all that. So it really gave me the confidence that I can, you know, run a business by myself. So maybe it could have been like smarter choice to jump out of that and build a business a bit earlier.

 

[ 00:21:16 ] But for anyone who who would like to become an entrepreneur, I would still recommend trying to get a job somewhere where you actually have like a fantastic team, like super smart bosses. Or colleagues who can really help you develop and give you the responsibility that you will definitely face if you become an entrepreneur. Because, in the early days, I couldn’t ask help uh from from anyone in the team. Obviously, I had like fantastic friends and business contacts and all that, but in the end, we had to do everything ourselves. So, work in a small team really gets the responsibility, learn to get how how can you actually get stuff done not just PowerPoint, actually getting stuff done. That’s the advice I would give to anyone.

 

[ 00:22:05 ] So, among the advice you would have given your younger self, anything to avoid. any fuck-ups that you uh… I think decision making is one of the best skills you need to have in order to be a successful entrepreneur as an entrepreneur, if I would go back again on the path of Wappaus, I would really use this concept of one-way and two-way decisions. You have like two kinds of moments. You have the one-way decisions which are the kind of like decisions once you make them it’s really difficult to come back… and then you have two-way decisions, those two-way decisions are the moments when you can actually decide something and try it out and then if it doesn’t work, you just come back and the whole story. About startups is usually about being fast, daddy, daddy.

 

[ 00:22:47 ] I move fast, break things kind of like things, but you need to understand that with some decisions, you need to take your time, make a good decision, ask everyone, and then – and when you actually have uh gathered all the information you need, then you do the decision. For example, we did um one major, kind of like, fuck-up that we’ve done. I’m not sure if I can say that in the podcast, but you just did, so… So one major, like, uh, fuck-up we did was, uh, we closed the books for one year like super fast because we thought that that’s gonna really really help us with uh getting the finances and The investments the next year, uh, but once you close your books, you can’t reopen them anymore.

 

[ 00:23:35 ] And we actually made like a huge mistake with the with the way that the accounts look like nothing criminal, nothing wrong, but something like really stupid, you know. The same tax functionaire who was giving a hard time might be listening to this podcast, so watch out with what you’re saying right now, don’t get anyone on your case. You might end up with three more days of intense lobbying around us and key yeah, but um that was like a one-way decision kind of like a moment that we should have taken our time and really thought about what’s Going to be the smart choice, but then again if it’s a two-way decision you can decide and then if it doesn’t work you come back, then you move fast.

[ 00:24:11 ]Okay, Miko, we could continue this conversation for many more hours, and actually I intend to do it with you over a beer later this evening after Slush, but we’ll have to stop the recording here. This was Miko Ampuja, CEO of Vapaus, who’s making bikes more accessible for employees. In our next episode, I’ll be talking with Lars. Syse Christiansen, CEO of Wanda, a company which enables circular logistics, to learn more about any of these startups, just visit startuprise.eu. This was what were they thinking: the stories behind Europe’s most promising clean mobility startups. You can find all episodes on your podcast platform. I’m Dan Sobovitz. Don’t drive too fast and see you next time.