Founded in Bergen, a city known for its rain and as the actual birthplace of modern meteorology, StormGeo was built on first-hand experience of and enthusiasm for weather. Through a new strategic partnership with DNV, its employees feel better prepared than ever to take on the world’s most challenging weather conditions.
In collaboration with TV2, Norway’s largest commercial broadcaster, meteorologist and presenter Siri Kalvig started StormGeo in 1997 as a spin-off of the channel’s popular weather services. With its groundbreaking use of graphic animations and a bright, youthful approach to presenting even the gloomiest of forecasts, TV2’s weather services became a strong contender to the state-subsidised Meteorological Institution in the 1990s.
“Although TV and media represent less than 10% of our revenue, we definitely still have a lot of that TV approach in us,” says chairman of the board Erik Langaker. “It has always been deeply ingrained in StormGeo that the only way to sell services that competitors give away for free is to offer fresh and innovative products developed by people with a genuine fascination for weather and climatic conditions.”
Mr Langaker speaks with apposite enthusiasm about the commitment to research and development that has helped take StormGeo from a national weather services provider to a global company with 12 offices in nine countries. “Over the past ten years, we have invested more than 25% of our gross annual revenue back into R&D – well aware that every penny might not pay off, but convinced that it will help create products that differentiate us,” he says.
Originally providing weather forecasts for the media, StormGeo soon expanded to include services for the hydropower and oil & gas industries. Spotting a niche market in delivering not just forecasts but also analyses of the weather’s effect on business, StormGeo gradually began developing meteorology systems with a unique understanding of the performance of each individual entity.
”We spent nearly three years preparing for international expansion by gradually shifting our focus towards products and services that can be sold anywhere in the world,” Mr Langaker says. “But in order to achieve that, we realised that we needed a new ownership structure that supported our growth and globalisation ambitions.”
In 2008, Mr Langaker’s company Idekapital AS acquired a 42.5% stake in StormGeo, entering into a strategic partnership with TV2 Invest and Kalvig to focus on internationalisation. Three years down the line, after StormGeo had established offices in the rest of Scandinavia, the UK and the US (and acquired Seaware AB, a leading provider of onboard ship routing solutions, in the process), private equity fund Reiten & Co Capital Partners became a principal shareholder by buying 67.7% of the equity.
Mr Langaker says StormGeo finally reached its ownership ambitions in the spring of this year, when DNV acquired the right to purchase 22.7% of StormGeo’s shares through a mutually convertible capital issue.
“We are really proud to have DNV on board,” says Kent Zehetner, the CEO of StormGeo. “Our organisations share core values and ambitions when it comes to research, innovation and technical expertise. DNV has always been a role model for us, particularly due to its success in creating a strong global presence.”
DNV’s Chief Technology and Sustainability Officer, Bjørn K. Haugland, joined StormGeo’s board of directors as part of the agreement, which will see the two companies sharing networks and expertise around the world. “StormGeo’s activities are highly complementary to DNV’s existing business within the maritime, oil & gas and renewable energy sectors,” he says. “We have already identified cases within all our business areas where we feel we can deliver more to our customers if we act together.”
DNB Company of the Year
In a recent testimony to its commercial success, StormGeo was awarded the 2012 Company of the Year prize by Norway’s largest bank, DNB.
The jury emphasised strong performances by young and visionary employees and a culture that has dared to challenge the markets through continuous investment in R&D and competence development. “We were always attracted to this entrepreneurial spirit that we find throughout the StormGeo organisation,” says Mr Haugland.
Together with DNV, StormGeo will continue to focus on its four main business areas: offshore, shipping, renewable energies and media. Mr Langaker and Mr Zehetner both emphasise that DNV’s world-leading experience in risk management and certification will be particularly valuable as these industries become increasingly subject to new requirements as a result of climate change.
“This partnership will enable us to think in a much more long-term perspective, especially in terms of product development in a rapidly changing market,” says Mr Langaker. “At the end of the day, the most important principle that we share with DNV is that no matter where we are in the world, we will never compromise on safety.”
Mr Haugland agrees: “As the world struggles to reduce CO2 emissions, we see the need for effective and risk-based adaptation to climate change. This trend will increasingly call on best-practice meteorology systems, and StormGeo’s core competence and ability to communicate complex issues in a simple and elegant way will be very useful to DNV and its customers.”
Text: Hanne Christiansen