Finland’s role in Nordic defense hinges on ability of tech to step up: Commentary
Grey zone. Finland has been there before. Not many decades ago the French confused Finland’s old SF vehicle identification code for Soviet Finland (it actually was Suomi, Finland).
Now, the country again risks becoming a grey zone. In October 2023, Chinese containership Newnew Polar Bear allegedly damaged a pipeline in the Gulf of Finland. Since then, several more subsea cables have been cut making the region a hotbed for hybrid operations, traditionally occurring in grey zones.
One would think that with such a past, Finland would with all its might try not to fall into the same trap again. Although a member of NATO since 2023, the country still has the other foot in the past. Its intelligence institutions aren’t yet up to western snuff, leading to the defence lead in Northern Finland being given to Sweden. Finland may not have earned full US trust just yet as its struggling economy remains a boon for foreign influence operations.
Being in practice a Soviet vassal state for 40 years following WWII, Finland was prevented from running a satisfactory military intelligence, a practice it was lauded for before the war, and a modern army. With time, this conformable foreign policy got a name for itself, Finlandization. As a consequence, Finland has been timid also in its transatlantic relations.
Key startup exits reflect this. Daniel Ek’s Spotify was listed in New York, while Ilkka Paananen’s Supercell is now 91 percent owned by China’s Tencent. Sweden’s Ek has since invested in German defence technology startup Helsing, while Finland’s Paananen is giving to war relief. Finland’s venture landscape follows this with the top funds having a history with Chinese limited partners.
To avoid getting sucked into the grey-zone vortex, Finnish tech and venture operators need to start working together with their Nordic peers, not against them. And if that wasn’t challenging today, it may be more difficult tomorrow as geopolitical shifts collide.
Shifting US Foreign Policy
With Europe in shock after JD Vance’s speech at the 2025 Munich Security Conference, the old continent is scrambling to regroup. A fortnight later, the coalition met in Kiev to celebrate Ukraine’s three-year anniversary of resistance against Russian terror. The US was absent and instead called Zelensky a dictator, which later escalated into a disaster in the Oval Office and a US Ukranian withdrawal.
As a result, Europe is starting to prepare for a new world order, led according to former MI6 head Alex Younger by “strong men and deals” instead of rules-based institutional systems, he told BBC.
For this article, I will base the outlook on the following assumptions:
1) The US is increasingly courting Russia to separate Putin from cooperating with China, which the US progressively sees as its only rival.
2) The US is increasingly putting pressure on the European Union — which it feels is too liberal to alone be a reliable ally against China and islamic extremism— by cheering far-right players locally.
3) And lastly, the US is increasingly turning its focus from Europe to the Middle East by supporting the Israeli war on islamic extremism, its second biggest threat after China.
All these blend into a cocktail that will shape new European defence with varying outcomes and put pressure on the cohesion of the European Union as a whole. The US is now testing how its historic allies react to warming relations with Russia, an age-old foe to Finland.
Complicated Nordic Cohesion
The Nordic region has never been as close-knit when it comes to defence as it has been since Russia’s invasion of Ukraine. From the outside, the region may look incredibly tight and homogeneous. A stronghold of democracy. But the fabric is complicated.
Finland, which is in the European union and the euro, is suffering from a generation of economic stagnation. Norway, neither part of the European Union nor the euro, has meanwhile built the world’s largest sovereign wealth fund spawn from its vast oil reserves. A 1,75 trillion euro behemoth. Both Denmark and Sweden are faring somewhere in between, both in the EU but not the euro.
That said, Finland, with NATO’s longest border with Russia, is today led by one of the most US-literate leaders in Europe, a polyglot Swedish-speaking Finn who manages to deliver a coherent message in multiple languages in any setting.
A self-proclaimed transatlantist, Alexander Stubb is poised to play a pivotal role in which shade of grey Finland will fall into and through it form a critical role within the Nordic region. As a precursor for what’s to come, Stubb was the person placed on the right side of Zelensky at the Kiev three-year anniversary, the meeting snubbed by the US.
Just a few months ago it seemed ironclad that the Nordic region will jointly, together with other NATO countries, form a joint force to defend against evident Russian aggression. But with the second Trump administration, everything has now been put on its head.
Bara Bada Bastu
This is putting pressure on Finland’s Stubb, who needs to balance Finnish disdain for Russia and the new, erratic foreign policy of the US. Add into the mix the dissimilarities in Nordic-EU relations with the odd-man-out role of Finland.
Russian distrust runs deep on the old continent. But Stubb may as well become the unexpected hero of not only Finland, but all of Europe. Charismatic leaders with an ability to charm leaders regardless of origin run one in a million.
This is needed as Finland is the only Nordic country that is all-in with the EU, which the country saw as a proxy to NATO instead of poking at Russia with full membership. Being all-in with the EU now puts the brakes on Finland’s transatlantic dexterity.
While Finland’s shade of grey may this time be more hued, its technology leaders must pay heed and stand up. Although its deep tech and dual-use startups, such as AMD Silo AI and IQM, show world-class promise, Finnish tech founders need to start producing defence-first startups of similar quality.
On a less serious note, Finnish tech founders and investors need to do what the Finland-Swedish music group KAJ did at the Swedish Eurovision Song Contest qualifiers: fully embrace its larger neighbour.
Meanwhile, Sweden will siphon everything.
Dr. Jonas Dromberg is the founder and principal at Revalence Ventures. Based in Helsinki and Stockholm, he has spent more than two decades in venture capital and finance. A former Bloomberg bureau chief, Jonas served as venture partner at one of the top Nordic venture funds and received his doctorate at IE Business School in Madrid researching VC limited partners and family offices. He is a member of the European and AUKUS defense investor networks.
