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The case against traditional passwords

October 2, 2019
Margarita
Passwords have been around for millennia. Thousands of years before the advent of the computer, the Roman military would use what Polybius described as a watchword to distinguish ally from enemy. Similarly, during the Battle of Normandy, US paratroopers used constantly changing call-and-response passwords – flash would be responded to with thunder, for example — to establish friend from foe. The password entered computer science in 1960 thanks to Fernando Corbató, as a means of keeping files private. The Massachusetts Institute of Technology had developed a time-sharing system that all researchers had access to, however all files shared a common disk. To keep individual files private, a password was introduced and users could access only their own. With the introduction of the internet, the popularity of the password soared as a straightforward but relatively effective means of keeping user accounts secure. Decades on, cybersecurity is still a challenge as data leaks and hacking attempts are more rife than ever. For many, the fact that we are still primarily using passwords as a means of protecting our sensitive data is an anachronism in dire need of addressing.

Enter biometrics

This is where biometrics can make an impact – and, indeed, they already are. You can thank tech giants like Apple and Samsung for popularizing the technology, introducing fingerprint scanners some six years ago and slowly building functionality onto the technology. Initially, users could unlock their devices using their fingerprints. Today, banking apps grant access based on the information, and purchases can be made on app stores using no more than a print. On a very simple level, biometrics improve the user experience. Rather than having to remember passwords or draw patterns to unlock devices or perform other secure tasks, users can simply use fingerprints or facial recognition. Both are almost always quicker and more secure, serving as a brilliant example to users that the technology is nothing to fear and can improve their experience significantly. Some 89 percent of consumers are already familiar with biometrics in some form, with 55 percent using fingerprint recognition technology on a regular basis. This comes from the inclusion of fingerprint scanners on just about every major smartphone released in the last few years. With one tap, users can gain access to their devices in a way that is deemed so secure, that it can be used to authenticate payments. Many also now utilize facial recognition technology for even more seamless user identification, with the likes of Apple allowing users to pay using only their faces. Passwords are a weak link for both user security and company efficiency. For most people, the notion of having the same password for every account they hold is too dangerous — password theft is rife and any breach would be best contained to a single account. On the other hand, remembering multiple different passwords across the myriad accounts we hold in 2019 is also imperfect. For customers, it’s a headache, while for corporations it can be an expensive waste of time. According to CNN, Microsoft spends $2 million a month on help desk calls from people who want to change their passwords. According to a 2017 report from VISA, some 61 percent of respondents have multiple passwords across their different accounts, making the problem a significant one. When asked why they had abandoned an online purchase in the past, half of the respondents cited not being able to remember a password as a reason. Abdulaziz Alzubaidi has a PhD in engineering with a focus on security and is currently a faculty member at Umm Al-Qura University. For him, biometrics are the future of authentication and the humble password may be due retirement. “When we talk about biometrics, we should consider both types of biometrics; physiological and behavioral,” Abdulaziz told Binary District Journal. “Modern devices support physiological biometrics such as fingerprint and face recognition. Although these biometrics have a few limitations, they should be used as an authentication method, since traditional methods like entering a PIN or drawing a pattern are vulnerable to simple exploits like shoulder surfing attacks, which allow anyone to gain device access. In my opinion, I see biometrics having a high possibility of replacing traditional authentication methods. “Imagine this scenario, your device has been used by a friend or even a family member, who knows your password for your device and online bank. He/she can easily access the device and log in to your account, even if he/she uses multi-factor authentication. This simple scenario shows that traditional authentication methods can increase the security issue for anyone. It is not only for banking but for any available app on your device, like social apps, emails etc., so biometrics are more secure when we compare them with the password method.”

Managing resistance to change

User experience is important here, though. If relying on fingerprint scanning alone is too porous, developers should consider other methods of authentication before adding more biometric hoops to jump through. No one wants to have to scan their thumb and their face while speaking into their phones just to access their mobile banking. Equally, some people may not be comfortable with using a fingerprint scanner at all, particularly if they are being asked to provide that information just to access a social media account. What will be important is customization. Developers will have to offer users different options and make the security implications of those options clear, much in the same way that some websites offer two-stage authentication but don’t make it compulsory. If a banking app can be opened with one a fingerprint, great, but some users will feel more comfortable adding a password and an iris scan to the process, once the latter becomes sophisticated enough. In terms of security, pivoting to biometrics may well throw up just as many questions as it does answers. Crucially, passwords can be changed if stolen. If a hacker finds a way of breaching biometric authentication, the implications for the user’s multiple accounts and devices would be huge – it’s a lot less simple to change your fingerprints or your face. There have also been cases of hackers gaining access using a picture of a user’s face. This could mean that multi-stage authentication will still be necessary, nullifying the seamlessness that makes biometrics so appealing in the first instance.

Just be yourself

The next step in customized authentication is behavioral biometrics. This is biometrics not based on physical identifiers like fingerprints or scans of the iris, but rather the analysis of a user’s behavior to determine their identity. Going far beyond technologies like voice and signatures, behavioral biometrics can focus on anything from finger movements to hand tremors and hand-eye coordination. It can even be determined how well the user knows the information they are being asked to submit, or how familiar they are with the app they’re trying to gain access to. “Recent research has proved that behavioral biometrics have the potential to identify a smartphone owner with high accuracy,” Abdulaziz says. “Most of these studies use different approaches like touchscreen, keystroke, gait, behavioral profiling etc., and show each subject has a unique identity. Behavioral biometrics does not need more sensors, so the cost of building any device will not increase. “The main points that we need to consider are time to train, size of data, and where should be trained. Addressing these points will lead behavioral biometrics to be one of the important biometrics, in my opinion, not only in smartphones but to most smart devices.” Behavioral biometrics, if successfully deployed, will solve problems that other forms of cybersecurity have faced throughout their existence. One major positive is that it is a passive form of identification – users need not change their behavior at all to access their devices – in fact, quite the opposite. They can also be deployed throughout the session in the background, meaning gaining access won’t give hackers carte blanche to exploit a user’s account. As with all authentication methods, accuracy will be paramount. There are a number of companies – see NuData, BehavioSec or Invisible Challenges, for example – working on building behavioral biometrics solutions, while UK bank NatWest has shown interest in utilizing the technology to prevent fraud in real time. Getting to a workable degree of accuracy will involve machine learning and even deep learning, while a large degree of drip-feeding will be needed to encourage a typically skeptical public to trust the technology. If the success of fingerprint ID for smartphones can be taken as a marker, then biometrics will be welcomed by users. The technology is an easy sell, and any discomfort around tech companies holding your fingerprint data will be offset by how clearly preferable Face ID is to a password when it comes to keeping a bank account secure. There will be teething problems – hacks will make headlines and some will be uncomfortable with the technology – but ultimately the password appears doomed in the face of a truly 21st century alternative.
Startup ecosystem

Tampere’s unique startup ecosystem: Identifying areas of growth and learning from Helsinki

May 21, 2024
Abigel Varuhin
Helsinki vs Tampere startup ecosystem

Tampere ranks as the second largest urban area in Finland and stands out as one of the nation’s fastest growing city regions. According to a survey conducted by Taloustutkimus, Tampere has been acclaimed as the most desirable city to live in Finland.

While Tampere has been recognized as an attractive city for individuals, there’s a notable lack of incentives for companies, which can impede the attraction and retention of startups and businesses. To sustain the growth of Tampere’s startup community alongside the city’s expansion, it’s crucial to pinpoint what makes Tampere attractive for startups and to glean lessons from the more established startup hubs like Helsinki.

This article is based on the insights and perspectives shared during roundtable discussions with investors and venture builders at the Stream Connect event in December 2023 in Tampere. These discussions focused on understanding the unique aspects of Tampere’s startup ecosystem, comparing it with Helsinki’s, and identifying areas for growth and improvement.

Why Tampere?

Operating outside Helsinki, particularly in cities like Tampere, offers numerous advantages. The environment characterized by relatively limited capital availability often results in lower company valuations, making startups in Tampere potentially more attractive to investors looking for lower entry points. 

Additionally, the reduced competition for funding compared to the capital means startups might face less pressure and have more room to develop at their own pace. This can be advantageous for early-stage companies that are still fine-tuning their products or business models, allowing them more flexibility and time to mature before seeking larger investment rounds.

Tampere’s industrial heritage could be a foundation for future innovation, but this potential hasn’t been fully harnessed to create new ventures or technology spin-offs. 

The emergence of companies like M-Files and Wirepas, stemming from the Nokia ecosystem, suggests that Tampere has the capacity to nurture companies with strong domain expertise. However, this potential has yet to be fully utilized in shaping a unique identity for the city’s startup landscape. 

Moreover, Tampere’s startup ecosystem can leverage its supportive community, specialized industry focus, and unique research opportunities, factors that may not be as prevalent in Helsinki.

Valuable lessons from Helsinki

Helsinki’s startup ecosystem benefits from a robust and extensive connection to government support, setting it apart from Tampere. The Finnish capital has strategically positioned itself as a central hub for innovation and entrepreneurship, largely due to significant government initiatives and funding.

In Helsinki, government agencies work closely with startups, providing not only financial support but also access to a network of mentors, advisors, and industry experts.

Additionally, the city hosts numerous events and competitions that foster innovation and provide startups with platforms to showcase their ideas.

In contrast, the lesser degree of direct connection between Tampere’s startup ecosystem and higher government levels, such as ministries and legislative processes, presents a notable challenge. This limited interaction hinders the ability of Tampere’s startups to influence policy making, access government-funded resources, and benefit from the legitimacy and support that government backing can provide. In comparison to regions with stronger government ties, Tampere may find itself at a competitive disadvantage.

The comparison between Aalto University and Tampere University reveals significant differences in their support for spinouts and commercialization.  Aalto University in Helsinki is recognized for its effective mechanisms, providing infrastructure, funding, mentorship, and industry connections to help researchers and students turn their innovations into marketable products and viable businesses. In contrast, Tampere University has a less developed system for supporting these activities.

Helsinki’s status as the capital and a larger city results in a higher concentration of research centers compared to Tampere, shaping the Finnish innovation landscape. These centers, often connected to universities, government agencies, and private industries, create a rich environment for scientific and technological research. Consequently, startups in Helsinki benefit from greater access to cutting-edge research, collaborations, and specialized talent. In contrast, Tampere hosts fewer research institutions, potentially limiting the resources available to its startup community.

Helsinki, as a global hub, significantly outpaces Tampere in terms of its startup and business environment. The capital city attracts international attention with its well-established infrastructure, diverse funding opportunities, and extensive government support. Helsinki’s global connectivity, vibrant ecosystem, and access to top-tier talent make it an attractive destination for startups and businesses looking to scale. Despite Tampere’s aspirations to be a global hub, it currently faces challenges in fully realizing its international potential. The city needs to enhance its appeal to international talents, which involves improving facilities like international schools and services tailored to a global audience.  

Many startups in Tampere are in their early stages and require support to mature and become investment-ready.

There is clear demand for impactful initiatives like Helsinki’s Startup Sauna in Tampere to cultivate the necessary drive and ambition for a successful startup journey, particularly among students. While organizations like TampereES play a vital role, they currently lack the scale and resources to significantly impact the startup ecosystem. 

Helsinki offers excellent examples of how influential non-profit networks and initiatives can shape entrepreneurial ecosystems. The non-profit “KIUAS” supports startup growth through resources, mentorship, and help from dedicated individuals. Similarly, the “Slush Mafia,” a network of individuals and alumni from the leading startup event Slush, significantly impacts the startup community in Finland and beyond. These entities foster a supportive environment for startups, facilitating connections, knowledge sharing, and access to opportunities.

Next steps

For Tampere to live up to its potential and for the startup ecosystem to thrive, it needs to focus on the city’s unique strengths and build a more differentiated value proposition. This could involve promoting specific industry sectors where Tampere has a competitive advantage and  offering unique incentives for startups and investors. In addition, learning from the already established and flourishing startup hubs, such as Helsinki, serves as a blueprint to point out areas of growth.

To effectively address these challenges within Tampere’s startup ecosystem, collaboration among educational institutions, local government, the private sector, and the startup community is essential. 

Venture building

Venture building in Tampere: A new approach to startup growth

April 22, 2024
Margarita

Venture building is still pretty fresh on the scene in Finland, especially in Tampere. This model flips the traditional script of venture capital and accelerators by not just funding startups but rolling up its sleeves and getting deeply involved in their day-to-day operations. Here’s a closer look at why this could be a game-changer for the local startup ecosystem.

This article is based on the insights and perspectives shared during roundtable discussions with investors and venture builders at the Stream Connect event in December 2023 in Tampere. These discussions brought together key stakeholders in the startup ecosystem to explore the potential and challenges of venture building in the region.

Hands-on Approach

Venture builders do more than inject cash. They embed themselves within the startup, working alongside the founding team to develop strategy, build the product, and scale operations. This approach is more akin to a co-founder relationship than a typical investor or mentor role, which is common in accelerator programs. This means they take a significant stake in the business, but they also share the risks and the heavy lifting of building the company.

While places like Silicon Valley or Berlin are awash with venture studios that take large equity stakes in the businesses they help build, Tampere is still catching up. The Finnish city doesn’t have a strong tradition of these high-stakes, hands-on venture studios. This isn’t just a small wrinkle—it’s a significant gap in the startup support landscape. Traditional Finnish caution in equity distribution means potential founders might worry about losing control over their visions.

The local venture building scene isn’t without its challenges. For one, there’s a saturated market of accelerators that sometimes offer little more than a new logo. And while these programs don’t demand equity, their impact can be minimal, leaving startups wanting more substantive support. On the flip side, this presents a unique opportunity for venture building to fill a critical gap by providing the hands-on, operational support that accelerators often lack.

Venture building could also address another local issue: the shortage of support for more mature startups. Most initiatives target early-stage companies, leaving those in later development stages without the tailored support they need to scale up.

Strategic Considerations

Given the challenges, Tampere’s startups need to think carefully about equity. Current recommendations suggest keeping advisor equity under 10% to remain attractive to investors. This cap, along with a proposed vesting model for advisors, aims to ensure advisors stay committed over the long haul without diluting the startup’s equity too much.

For Tampere, the path forward involves nurturing a venture-building ecosystem that aligns with the city’s strengths in engineering and academia. By fostering deeper, more operational partnerships between startups and builders, Tampere could accelerate the growth of its tech sector, transforming the city into a hub for innovative startups.

Venture building offers a more integrated model of startup support, one that could lead to more sustainable growth and more robust businesses. As Tampere explores this path, it might just find a new model for startup success that could set a benchmark for Finland.

Scrum

Scrum for startups: From Google and Microsoft to Spotify and AirBnB

April 22, 2024
admin

Author: Roman Poltavchenko, Project Manager at Perfsol

Managing a startup is always about the speed of implementing ideas and competing for the client. That’s why every second and small move matters. When it comes to two almost identical applications or software products, the approach to its development is often decisive because the methodology used can significantly affect the quality and speed of the result. This is where Scrum comes in, a powerful methodology that has led thousands of companies to success. Find out what scrum is, what are its advantages, real use cases, and much more in our article. Let’s go!

What Is Scrum?

Remember these legendary names — Jeff Sutherland and Ken Schwaber. They introduced Scrum in the late 1990s.

The scrum methodology is an agile project management technique. First, it was mainly used for software development but now it’s applied in different industries. It is based on close teamwork, clear accountability, and an iterative approach. The team moves towards the goal in sprints — clearly defined periods of time during which the team has to complete a pre-agreed pool of tasks and, at the end of the sprint, discuss the performance and plan further actions. This contributes to greater productivity and also allows you to respond quickly to problematic issues. 

Moreover, the scrum team breaks down complex tasks into smaller ones, which allows for a deeper understanding of the project, more focus on the problematic tasks, and more efficient work.

The key elements of Scrum are:

  • daily stand-ups
  • sprint planning
  • sprint review
  • sprint retrospective

What are the benefits of Scrum?

In the previous subsection, we’ve slightly described the main benefits of the Scrum methodology, it’s time to take a closer look at them!

  1. Flexibility is probably one of the biggest advantages, especially for startups. Usually, startups have processes that are not yet fully established, and they have to adapt to changes — both in the project itself and external changes related to the global market. An iterative approach helps to respond quickly to challenges and change processes during their implementation and reduce risks, which ensures more efficient use of resources.
  2. Transparency: thanks to regular meetings (daily / weekly / at the end of the sprint) and reports, all participants in the process understand what tasks the team is facing and what their status is
  3. Greater customer satisfaction: since Scrum involves regular reporting and feedback, the client feels the progress in product development, and the team can better understand the needs of the client and better adapt to them
  4. Responsible teams: according to the Scrum methodology, teams have more opportunities for self-organization, are more autonomous, and have smooth communication. Therefore, the Scrum team feels more involved in the project, motivated and responsible for the overall result.
  5. High-quality result: all the above advantages contribute to the fact that project deliverables meet the customer’s expectations as much as possible (and often even exceed them). The software is of high quality because all imperfections are identified and corrected during the project.

Implementing Scrum in your project

At first glance, it may seem that integrating scrum methodology into your project is complicated, time-consuming, and resource-intensive. Of course, let’s not idealize – you will have to reconfigure some processes and work with the team. However, having a clear algorithm of actions, you will be able to do everything right. Here’s a step-by-step guide:

  1. Build your Scrum team: it doesn’t have to be large but it should include specialists in all areas that are necessary for the effective development of the project and the high-quality deliverables.
  2. Determine Roles Clearly: the core three roles in Scrum are: 
  • the Product Owner (he represents the stakeholders and the customers)
  • the Scrum Master (process facilitator who helps the team to overcome the challenges)
  • and the Developers (who implement all the necessary tasks)

Think of your team’s strengths and weaknesses and assign the roles appropriately.

  1. Plan carefully: get started there by discussing sprints duration with your team. In general, sprint duration can vary from 2 to 4 weeks. Then fill the backlog with the necessary tasks for each sprint and prioritize them.
  2. Take care of the communication process: daily stand-ups are a must-have for Scrum. They should be no longer than 15 minutes. The aim of such meetings is to discuss what was done yesterday, what the plans are for today and if there are any problems that need to be solved to ensure an effective work process.
  3. Analyze thoroughly: a retrospective helps not only to determine which tasks have been accomplished and which have not. It aims to collect all the experience gained during the project and plan the next stages based on it, avoiding mistakes and reinforcing the process with already proven algorithms of actions.

Pro tip: pay attention to tools and resources for Scrum management. Task planners like Trello, Jira and others can be of great help to keep track of your team’s activities.

Real-life cases of Scrum implementation

Over the past decades, Scrum has become a basic project management methodology in large companies, significantly improving their processes and leading to even greater success. Here are just a few real-life cases that will inspire you to implement Scrum right now:

  1. Google was one of the first to realize that managing investments and development of portfolio companies is much more efficient and easier with the Scrum methodology. The ability to quickly test business ideas, re-prioritize tasks, and be flexible in the face of market changes is a key advantage for such giant corporations as Google.
  2. Do you know about Microsoft Teams, a collaboration platform from Microsoft? Its success and popularity is largely due to Scrum. With this approach, Microsoft has managed to significantly reduce the time to market for new products, so now Scrum is used by such development teams as Windows and Office.
  3. Spotify, the favorite streaming platform of millions of users, has been working on flexible methodologies since the first day of its existence. Thanks to Scrum, Spotify managed to significantly improve the interaction between development teams, as well as improve the approach to releasing new features, as an iterative approach with feedback analysis at the end of each development stage helped to better understand user needs.
  4. The world-famous Adobe uses Scrum not only for software development but also for marketing activities. The flexible iterative methodology has become their key to more accurate measurement of campaign effectiveness, perfect alignment of marketing activities with business goals, and more. As a result, Adobe increased the brand’s presence in the global market and deepened user engagement.
  5. Rapid response to changes and trends, the ability to scale effectively, introduce new features and not only meet the growing expectations of users but also exceed them —  these are the key advantages of Scrum that the Airbnb platform emphasized
  6. A tech startup (one of our projects, the naming is under NDA) aimed to speed up the product’s launch, but the development cycle was too long. By implementing the Scrum methodology, they managed to halve the development time without losing the quality of the final product but rather making the process more efficient. As a result, our clients were able to enter the market earlier than their competitors, and thus gain and engage more target customers.

What’s next?

The market is transforming, business needs are changing, as are global cultural and economic trends. Accordingly, project management approaches are also being adapted to the relevant conditions, improved and taken on new forms. The same applies to Scrum. Here are some predictions that will become a reality in the near future:

  1. Scaling: small and medium teams have already fully experienced all the benefits of agile methodologies. Now there is a trend for large enterprises to transition to Scrum. Methodologies like SAFe (Scaled Agile Framework) and LeSS (Large Scale Scrum) are gaining popularity.
  2. More frequent use of automation: it’s proven by hundreds of companies that use Scrum that automation can:
  • significantly enhance the process
  • reduce the risk of manual errors
  • speed up the development cycle
  • improve operations
  • keep all the needed documentation up-to-date
  • ensure quick generation of the relevant project statuses
  • improve consistency and overall quality of the project, etc

So we recommend thinking of the implementation of the automation tools to get the most from the Scrum methodology, boost your internal project processes and get competitive advantage. 

  1. Focus on soft skills: automation, AI, and other technologies can impact the tech aspects of the project a lot. However, remember that project management is about managing people (first of all!). So there is no doubt that the value of soft skills of key Scrum team members will play a crucial role for many years to come. Here is a list of soft skills that you should always keep in focus and try to improve in your team:
  • empathy
  • leadership
  • ability to communicate effectively
  • providing guidance, support and mentorship
  • providing constructive feedback
  • shared responsibility 

Wrapping up

In today’s fast-paced business environment, Scrum is a reliable methodology to keep all the processes under control, react and implement necessary changes rapidly, stay flexible and scale without worries that your project will turn into a real mess. Regardless of the size of your team, it’s worth trying out Scrum.

Our company, Perfsol, uses Scrum and a hybrid approach (Scrum + traditional methodologies) in our development process and provides our clients with results that exceed their expectations! We believe that a step-by-step iterative approach combined with a passion for innovations and strong dedication to the project can lead each project to success. So, contact us, and we’ll provide you with more detailed info about our services and recommendations for your project. Let’s start your digital journey right now!

Acoustics

Towards a greener construction industry

June 30, 2023
Johanna Rita

The construction industry is considered to be among the major sectors that contribute significantly toward the emission of GHGs in the environment, which have a major effect on climate change. Construction and the wider built environment currently accounts for around 40% of the world’s global greenhouse gas emissions

According to the report Future of Construction: A Global Forecast for Construction to 2030 by Oxford Economics, global construction output is expected to grow by 42% by 2030. As the sector grows, so too does the risk of greater pollution and waste. Thus, the construction industry has a crucial role in reducing carbon emissions and promoting sustainability. This article explores a new type of eco-friendly technology that construction companies can use to innovate their old ways of doing things and build sustainably, through acoustics.

Acoustics is a scientific field that deals with the production, control, transmission, reception, and effects of sound. It is applied in various fields, not just limited to music and audio reproduction, but also in noise control and construction, among others. 

“Environmentally friendly products are often either very expensive or lack one or more technical features”, explains Mikko Paananen, CEO and Founder of Aisti. “There is a so-called harmonised product standard that includes four properties: fire safety, acoustics, bending strength, and indoor emissions”. 

He admits that bending strength and acoustics have been challenging for environmentally friendly products as the options are either cheap and environmentally harmful but technically good products or expensive, somewhat environmentally friendly, and technically poor products. Typically, mineral wool or glass wool is used in acoustical panels. 

However, Aisti has developed a completely new, environmentally friendly solution by mixing water, cellulose fibre, and foaming agent. The product is unique and has not been developed elsewhere in the world. Notably, it is carbon-negative, meaning the wood fibres have sequestered more carbon dioxide than is emitted during the production.

Aisti focuses on room acoustics – how sound travels in a given space. Everyone has likely seen acoustical panels embedded in walls or ceilings in places like offices, hospitals, and schools. The purpose of these panels is to absorb sound and prevent echo in the room.

“Our product has all the good qualities: it is as affordable and technically good as traditional solutions, while being extremely environmentally friendly”, underlines Paananen. “Once our factory opens in 2025, the product will replace all similar mineral wool and glass wool products. In the future, we can also use our product for insulation, where mineral wool and glass wool are widely used”.

Paananen cannot think of any other environmentally friendly transformation that the construction industry has undergone. “If anything, we have gone in the opposite direction”, he says. “Mineral wool and glass wool were big things in the past”.

The construction industry has a significant impact on the environment, as it uses many environmentally harmful products due to the lack of available sustainable solutions or their high cost. Solutions like Aisti serve as pioneers for environmentally friendly alternatives, suggesting that the construction industry is gradually moving toward more sustainable practices. 

Artificial Intelligence

EU’s Regulations and the Future of AI

June 22, 2023
Johanna Rita

Artificial intelligence (AI) is advancing at a rapid pace, faster than we might imagine. However, It is not only fascinating but also, at least to some of us, unpredictable and scary. This is why the European Commission is currently contemplating what regulations and guidelines should be established for AI. 

Will these new rules hinder AI development? And will they affect startups that utilise or develop AI technology?

High-risk areas of AI include, for example, infrastructures involving ethical considerations and safety components of AI products. However, the lack of clear regulations can also keep companies on edge, as they are uncertain about the guidelines. This uncertainty can impact the scale of investments companies are willing to make in AI.

Nevertheless, both Mikko Lehtimäki, Co-founder and Chief Data Scientist at Softlandia, a company leveraging AI, and Pontus Stråhlman, partner at Voima Ventures, which invests in AI startups, believe that regulations are ultimately beneficial. 

 

“AI is a tool, just like many others. Of course, it is a challenging tool and can be misused, so having some ground rules is essential”, says Stråhlman. “The purpose of regulation is good, and it does not inherently hinder AI development. 

 

If AI were left unregulated, surveillance technology could develop in a detrimental direction”.

 

Lehtimäki shares the same view. “Surveillance applications definitely need regulations”, he confirms. “The EU’s risk categorization is reasonable,  however the regulations should be considered based on the applications that utilise AI, rather than solely on whether a technology is classified as AI or not”. 

 

He also describes AI as “a vague concept” and believes it would be better to focus on rules based on the use cases rather than merely the presence of AI. This could be the biggest challenge when the EU starts implementing regulations.

 

How will regulations affect AI startups?

Voima Ventures has invested in several startups that leverage AI, such as Kuva Space and MVision. These companies employ AI in various ways, including data collection and medical applications. Stråhlman notes that regulations like GDPR have posed clear challenges in using medical data. 

However, he has a clear message for startups: don’t be too afraid of AI regulation.

“Startups should focus more on whether their business ideas will still be relevant in 5-10 years when AI progresses in great leaps and bounds”,  Stråhlman emphasises.

Again, both Stråhlman and Lehtimäki agree that excessive regulation of AI can be a hindrance. “I certainly don’t oppose privacy protection, but regulations related to it slow down the progress”, says Stråhlman.

Lehtimäki mentions that EU regulations have not yet affected their company’s operations, but the unclear nature of the rules makes it difficult to draw conclusions. 

“It is possible that once the regulations come into force, we may have to register as a provider of large-scale AI models”, he notes. “This would entail additional costs and reduce our agility, and we might need to demand reports from our customers on the impact of using our applications”. 

Even though the regulations have not been finalised yet, their implementation will most obviously increase the costs and slow down the innovation.  “If utilising or offering AI technology becomes too bureaucratic, it will impede the operations of small companies”, explains Lehtimäki. 

“AI will become the business of large corporations, meaning there will be fewer players innovating and developing AI and AI-powered services”.

The future of AI

Despite forthcoming regulations, Lehtimäki does not believe they will significantly slow down AI development: “Of course, if AI regulations elsewhere in the world are not as burdensome as in the EU, there is a risk of falling slightly behind global progress, but probably not significantly”.

According to the European Commission, the EU has the potential to become a global leader in safe AI. The commission plans to invest one billion euros annually in AI. 

Stråhlman and Lehtimäki underline that regardless of regulations, AI will be part of everyday life in Finland and globally in ten years. They do not anticipate an AI dystopia or a scenario where AI surpasses human intelligence.

“Human beings can create much more dangerous weapons that pose a greater risk than AI”, says Stråhlman. 

Instead, he believes that AI will solve many societal challenges, such as labour shortages. However, the nature of work will undergo significant changes, presenting both opportunities and challenges. It is also important to remember that if AI is not subjected to any regulations, it will undoubtedly be used for nefarious purposes.

Quantum Technology

What is the potential of quantum computing really?

June 19, 2023
Johanna Rita

Quantum technology is a rapidly advancing field that offers significant opportunities.  It has been a honeypot for investors in the past few years, as evidenced by a total global investment of $2.35 billion in 2022. 

Fast growing companies can be found in abundance throughout the Nordic region in particular, for example, Quantum Machines in Sweden and Sparrow Quantum in Denmark. Finland too boasts expertise in quantum technology, with numerous companies involved in its research and application.

“Quantum technology is a phenomenon that doesn’t seem to make sense at first”, says Juha Riippi, the founder and CEO of Quanscient. “It is a completely new way of building computers by harnessing the phenomena of quantum physics”. 

Quanscient specializes in multiphysics modeling which accelerates the testing of various products such as electric motors and aims to utilize quantum technology on its platform in the future. In April this year, it raised €3.9 million to help bring products to market faster with its quantum computing-powered solution.

According to Riippi, the advantage of quantum computers over traditional computers is in their ability to process a significant amount of information in parallel. Traditional computers store and process data using bits, which can be either zero or one. Quantum computers, on the other hand, use quantum bits or qubits, which can simultaneously be in the state of zero and one, or anything in between. 

This gives quantum computers immense computational power and the ability to perform complex calculations simultaneously.

“The more qubits a quantum computer has, the more powerful it becomes”, agrees  Juha Vartiainen, Co-founder and COO at IQM Finland. “Adding just one qubit multiplies the computer’s performance”. 

IQM has built Finland’s first quantum computer and raised a €128 million round led by climate tech investor World Fund – Europe’s largest quantum round ever. As a spinoff of Aalto University and VTT Technical Research Centre of Finland, IQM’s core technology builds upon decades of research from the Quantum Computing and Devices (QCD) lab.

 

Why quantum?

Quantum computers can be used, for example, in the early stages of medical testing to study the active compounds of a drug and examine how certain protein chains interact and affect the recipient of the medication.

“Today, simulations are used to some extent, but if there are already a few complex molecules to model, the capacity of current computers is insufficient”, explains Riippi. “Quantum computers can model very complex and extensive molecular chains, speeding up the process by years“.

In industrial sectors, quantum computers can be beneficial in the modeling of airplane aerodynamics, for example, accelerating product development and manufacturing.

In the financial industry, quantum technology can be utilized in investment optimization.

Finland has been researching quantum technology since the 1960’s. “We have a lot of research on quantum technology and growing companies that utilize it”, confirms Vartiainen. “Considering how small our country is, we are in a good position”. 

The construction of Finland’s first quantum computer has been a three-phase process. The first version had five qubits, the next had 20, and in the ongoing third phase, there will be 50 qubits. In future quantum computers, it is believed that there could be even millions of qubits. 

According to Vartiainen, there is immense interest in quantum technology, and it will emerge as a new industry.

 

A threat or possibility?

Although quantum technology will solve many problems in the future, there is still much room for improvement. Vartiainen points out that the technology can also be misused.

There are countless databases around the world containing people’s personal data encrypted with old technology. Quantum computers could break these encryptions. “This is a topic widely discussed in the field of quantum technology”, agrees Riippi. “Quantum-secure cryptographic algorithms are already being developed”.

However, the opportunities created by quantum computers outweigh the potential threats. 

 “Once the security issues are addressed, quantum technology will be very beneficial to us within the next 15 to 20 years”, assures Vartiainen. “Quantum computers are also more environmentally friendly than traditional computers”. 

The power consumption of a quantum computer is comparable to that of a traditional computer, but with significantly higher computational power. This reduces carbon dioxide emissions, which is great for the climate.

 

How fast can it be adopted?

“Quantum computers are currently at the stage where modern computers were in the 1960’s”, says Riippi. “However, the technology is advancing rapidly”.

“In the future, quantum technology will enable us to achieve wonders that are difficult to comprehend. Although we are still in the testing phase, the technology improves year by year. Someday, quantum technology could be accessible to everyone, perhaps through various cloud services.”

Quantum technology is still in its early stages, but within the next couple of decades, it is expected to become increasingly useful and advanced.

The pace of development in the field depends largely on investors. Currently, quantum technology is generating significant interest among investors, and Finnish companies like Maki.vc and Voima Ventures, as well as British firms like Entrepreneur First and Amadeus Capital Partners, have invested in quantum technology startups.

It could be profitable for university researchers studying quantum technology to establish a company and commercialize their research. Quantum technology is a future-oriented industry that will bring about significant transformations.

Startup

Startup-Corporate Collaborations in Tampere

August 31, 2021
Margarita

As a startup founder or a team member, you most likely have an endless supply of passion and willingness to learn as much as you can about your industry. However, it is pretty impossible to know everything there is to know about every area of business, and have all the resources available to you immediately within your team. You may find that you or your team lack experience in specific areas, or need access to a workspace, or could use funding/investment as well as professional guidance from seasoned professionals. Incubation, acceleration, advisory, and other partner programmes offer startups some truly valuable support.

One such programme is the EEX Journey that matches startups with corporate leaders as advisors in a year-long entrepreneurial journey. Over the course of the year startups benefit from an advisory board’s growth strategy guidance, business insights and network.

Having an advisory board is key to the growth of many startups across the world. Advisors are a valuable resource – they help your startup tackle distinct challenges and propel your business forward. An expert selection of professionals can fill the experience or expertise gaps in your own team. Finding dedicated people with specific skills and building an advisory board to match your startup’s unique needs can be challenging – programmes such as the EEX Journey can help.

EEX Journey Kick-off group 2021

The power of social capital is still underutilized. The insights the teams are exchanging are deep and strategic, beyond ordinary small talk. Many startups have learned how to better collaborate with and sell to large corporations. Corporations are tackling to keep their offerings up to date and build new initiatives. We’ve proven it’s possible to learn and adopt new drive and speed from entrepreneurs”, Elisa Kitunen, Country Manager, EEX Oy.

No No No, a member of Platform6 in Tampere, is a third-party platform created for consumers and businesses to work together to resolve issues and build better future customer experiences for both parties. The startup believes that if businesses work with transparency and integrity, the positive results will surely follow. No No No joined the EEX Journey programme in January 2021 and believes that programmes  such as this one are critical for connecting startups with the corporate environment.

“There has been a gap in the cooperation between startups and corporations in Tampere. As a startup that targets corporations in Finland, we need to understand their pain points and the way they make purchasing decisions”, says Jaakko Timonen, Founder and CEO at No No No.

No No No and their advisory board team

Another Platform6 startup, Valaa Technologies, has also benefited from programmes such as the EEX Journey. This prop-tech startup uses software robotics to help building owners connect their legacy automation systems to the cloud. “We pivoted our busienss during the EEX program. Our advisors had invaluable connections and experience that helped set our course with the new product. Also, their journey hasn’t ended yet: they now form our permanent advisory board and have also joined as investors”, says Ville Ilkkala, CEO at Valaa Technologies.

Great ideas and passion will only take your startup so far. Having a good network of professionals supporting and backing your mission can make all the difference in your growth. The ongoing pandemic has proven once again that startups need a supportive and collaborative community and can greatly benefit from programmes within the ecosystem.

The next EEX Journey starts in January 2022 – apply now through this form: https://www.eexglobal.com/eexstartup

Artificial Intelligence

Ultimate.ai, from Tampere to the world!

July 14, 2020
Margarita

Finnish customer service automation startup Ultimate.ai is one of the few companies that managed to grow despite the difficult year of 2020, and has raised $20M in Series A Funding, led by OMERS Ventures with participation from Felicis Ventures and existing investors HV Capital, and Maki.vc. Even though the company is Helsinki and Berlin based, their story began in Tampere, and they still have a branch in the city, at Platform6. Together with Tribecast, we had a chat with Reetu Kainulainen, CEO and Co-founder of ultimate.ai.


Reetu Kainulainen, CEO and Co-founder of Ultimate.ai

The beginning

The whole idea of Ultimate.ai originally started in a hackathon, where a company in Finland was looking for help for event organising services. “The first thing we did was just build the deep learning based algorithms. We didn’t have a product yet, but we started to get some traction, and realized this technology could be used to help customer service agents to automate some parts of their workflow.” Reetu explains.

It took Reetu and his Co-founders Jaakko Pasanen and Markus Rautio a long time to come up with a product, and one of their earliest demos to a big company was just a console output of their algorithm. But the customer started working with it, and has remained a customer ever since. “Maybe that says, that you don’t really need this super polished product to get started, as long as you have a strong problem that you are solving.” Reetu says. In 2017 Reetu, Jaakko and Markus got into Techstars in Berlin, and that really started pushing the process forward into building a scalable version of their product. That’s where they met their fourth co-founder Sarah Al-Hussaini.

Keys to success

As many of their customers are big global companies, one might think that having Finnish as your first language might bring some difficulties in building a customer service AI. On the contrary, since they had to build their initial services in one of the most difficult languages there is, it is now easier to do it in other languages as well.

The platform’s flexibility and highly tailored services is also something that sets them apart from their competitors. One of the key values Reetu believes to have driven Ultimate.ai’s growth is having strong opinions, held weakly, and being very close to their customers constantly learning from them.

Moving to the next level

Ultimate.ai has always believed in solving problems with technology instead of money. However, the series A funding now allows them to really create the market and become the number one player when it comes to customer service automation.“We are going to invest in the product, and AI research, as well as create a world class customer success team, so our customers can get to success as fast as possible.” Reetu says.

When asked about tips for new companies, Reetu raises up two key points: “For me everything comes down to the product. You need to really think about who the customer is, what they need, and build the perfect product to solve their problem. You should also think about distribution from the very beginning; how will my customers buy this and how will they get the value. When you build that within the product, it makes everything so much easier.”

Business communities and home sweet Tampere

Reetu also talks about the importance of business communities: “It’s a marathon building a company, and it is so important not to be isolated. You of course have your co-founders, but it is also important to have a network around you, and get peer support, ideas and inspiration from them. It doesn’t mean that you have to participate in every single event, but having the support network will help you, and you will help them.”

Tampere also has a place in Reetu’s heart: “I want to give a big shoutout to the whole Tampere community. Especially the first people that were scrappy enough to leave New Factory and go to the old and moldy Nordea office we had back then, and hustle your way into this amazing Platform6 you have today. That’s good entrepreneur spirit! I remember so many micro moments with the Tampere startup community back in the days, and I hope we can scale up that kind of tight community mentality even when the community is growing.”

<h2″>Don’t give up!

Even though Ultimate.ai seems like a fairytale success story, Reetu reveals that the road to success has not been an easy one. “It’s kind of a managed chaos. Even when the company is growing, and there are many customers, it’s still very hard, and we are still at a very early stage. Building a company is constant problem solving. Every step of the way is difficult, but that’s the point. The most successful companies are the ones who don’t give up. But you also need to be critical and not just stubbornly smash your head against the wall. Try new things. Listen. Learn. And don’t take things too seriously and drive yourself into a burnout. That is where the community can also help you; they can remind you to have fun too and that you are not alone!”

Listen to the full Tribecast interview with Reetu Kainulainen

Read more about Ultimate.ai’s series A funding

Find Ultimate.ai in LinkedIn & Twitter