Business ideas and landscapes: inspiration from Denmark

This inspirational Café Talk of Karen Hamann, director of IFAU Institute for Food Studies & Agro Industrial Development, provides insights on new business models that encourage rural business dynamics in Denmark.

The session was part of the first live RUBIZMO Café Talk Cycle taking part in November 2020. Follow the Playlist "How Europe can anticipate and support rural innovation" and discover more opportunities for rural development.

After the 15min. presentation the senior lecturer answered all questions of the audience. For more insights, read the following Q&A:

Q: How is the bio-refinery at ATB in Germany including carbon storage in the business model?
A: Carbon storage would be included in the environmental calculations and have yet to become part of the business model.

Q: Should we distinguish between rural entrepreneurship and rural based entrepreneurship? Sometimes people interpret rural entrepreneurs as agriculture, food tourism, but not other sectors.
A: Rural entrepreneurship is entrepreneurship developing in rural areas. If the entrepreneurship builds on local rural resources and the values generated are used to benefit the rural community we consider this as rural entrepreneurship. If an investor establishes a factory in a rural area it is a case of entrepreneurship in rural areas.

Q: I think anyone familiar with the Irish beef price crisis where farmers are very poorly paid for their beef would recognize the benefit of the Danish example. Why do you think existing models are so difficult to disrupt?
A: Denmark is among the largest pig exporters in the world and produces around 17 million pigs per year. The Danish pig industry is a large-scale system. Disruption in an established system comes from seeing new opportunities. It was very disruptive when Danish farmers started to produce organic pigs. The big meat companies had to adapt to this new line of production, and today, organic pig production has become an integrated part of the sector.

Q: Where do you think the strengths lie in the Danish agriculture knowledge innovation system?
A: In Denmark there is a system with advisors whom are specialized in the different types of farm productions: animals, crops, machines etc., and the advisors work closely with farmers and researchers. This collaboration enables knowledge sharing from researchers to advisors, and on to the farmers. The innovation system also provides public funding of projects and offers different types of entrepreneurial support measures. As an entrepreneur, you would go to your farm advisor, the local business development center and you'll be open to collaboration. I think particularly collaboration is a very important element in the Danish system because we have a long tradition for collaboration.

Q: The cases are quite different in the way they impact dynamics in rural areas. Which one is really affecting most the dynamics in the rural areas?
A: The crowdfunding mechanism has a big potential for creating rural dynamics. Crowdfunding is not a Danish invention; it is globally used and in diverse formats and scales. The example I showed you of COOP Crowdfunding is targeted at rural innovation and, food and entrepreneurship. The way the crowdfunding platform is organized enables consumers to connect directly with entrepreneurs. The other example about processing of grass to make a feed protein illustrates how technology, creativity and collaboration can lead to new business opportunities from a well-known crop: Grass. The grass protein concept and the rural crowdfunding platform could well be transferred into other contexts leading to more entrepreneurship in rural areas.

Q: Are there risks or, problems that could emerge from valorizing grass for making protein that could have an impact on traditional farming practices, e.g. a risk of forcing other businesses out?
A: The grass protein is an extra protein source made available to the animal feed market, and protein is in demand. The Danish system for making grass protein provides a basis for further development of connected businesses and technologies. This creates new opportunities for producers of farm machinery or companies making technologies for the bio-based industries.

Q: In what way do you think it is possible to find new business models to avoid the dispersion of traditional firms in places like Denmark, where the prices on imported vegetables are much cheaper than vegetables from Denmark? What about the competition in the European market?
A: Competition is a very complex issue. There is intense competition in the retail market and the market depends on international trade flows of fruits and vegetables. If you look at farmer's markets, local markets or specialty shops, you find other forms of competition, however there are many opportunities for locally produced crops