How to start a startup in Denmark in 2023

Do you wonder if it is difficult to start a company? It is not. These are the steps I made.

Talk to your accountant if you have a doubt about how to register the company. I have chosen the simplest type: The personal company. My accountant recommended this and depending on the situation in December, we might convert it to an ApS. That is, a limited responsibility company.

More information and inspiration

What does the company do?

You have to write a brief description (100 - 200 words) of what activities the company is involved in and who your future customers are. The bank and the insurance company will ask for it. More about that later.

What do I need to get started

  • a computer
  • an email address
  • a phone number
  • a credit card
  • an address
  • money

If you consider using your home address for the company, you have to check if it is OK. In my case, because I live in an apartment, I asked a lawyer. I don’t receive customers or goods to my address and I don’t have a production facility. I only work on my computer and talk on the phone.

How much money do I need?

It highly depends on what kind of company you are starting. In my case, where I have no inventory, production, or need to hire, the starting capital requirement is quite low.

  • You need a phone and a computer. But you probably already have that.

  • Expenses to start the company and cover the first three months. My budget says 15.000 kr. (2.000 €)
  • Expect the basic expenses for the entire year to be about three times that amount. That is, 45.000 kr. (6.000 €)
  • Then you should have about three months of salary saved up. To cover your living expenses while you get your first customer, send your first invoice and get paid.

Domain Name and Professional Email

I recommend that you get your domain name, before you create your company. It is probably the only thing you should buy before creating the company. But you need to make sure that you can get the domain name you want to correspond with the company name. You also need the email to communicate with public authorities and vendors.

You need a platform to work and there are two standard providers: Google and Microsoft. Both are easy to get started with.

There are a lot of companies wanting to sell you a domain name and host your website. After asking around, I found that these two approaches worked for me.

If you want to buy Microsoft 365 Business, you will need to have the domain name first. You can get it from one.com. The setting up of DNS records is a bit technical, but Microsoft will guide you through the process and one.com has a user-friendly user interface.

If you want to use Google Workspace, you can buy the domain name from Google. The process was extremely easy.

Google Workspace

You probably have an idea for a company name and you will need to buy a domain name for your company. Instead of getting the domain name from a hosting provider, I simply got it in the sign up process for a Google Workspace.

Get started at the Google Workspace.

In the sign up process, Google will ask if you already have a domain name. If you don’t have a domain name, Google can get it for you. Simply try out different names and Google will suggest available domain names for you.

Once you have your domain name, you can choose your first email for the first person in your company.

Once you have signed up, you will get access to the Google Workspace Admin Console where you have an overview.

Microsoft 365 Business

Once you have your domain name, you can sign up for Microsoft 365 Business and link your domain name and email to Microsoft.

Make sure to start with the 1-month trial for free, so that you have created your business when the first invoice arrives. Make sure to remember to add your CVR number as soon as you have it.

Company Name

Should my name be part of the company name?

There are a few things that change when your own name is the company name or part of the company name.

For one, at least in Denmark, I am not required to put the company name on my mail box. Meaning that my neighbors do not need to know that I have my own company. Second, I don’t need to change the invoices I get from the phone company and the internet provider. Well at least not right now.

Having your name in the company name will make it easier to hit the ground running.

Finn Pedersen France

I decided to name my company Finn Pedersen France for a number of reasons.

In 2017, before coming back to Denmark, I started working as a freelancer and the name of the company was Finn Pedersen in France Sarl. My new company represents a continuity of my old company and activity.

Further France represents an important part of who I am and my professional life. I lived more than 20 years in France from 1996 until 2018.

I also hope to get some business in France (for the language) or the Mediterranean countries (for the culture).

Create the company

Now that you have a company email you can create your company.

In Denmark: Go to virk.dk

Find a link saying Start virksomhed and follow the instructions.

I had my CVR number in about 24 hours.

The CVR number is the Danish company registration number.

Choosing an Accounting System

Now the most obvious solution is, of course, Microsoft Dynamics 365 Business Central, because that is the solution that I am programming solutions for.

However, I chose Dinero to begin with, because I was already using it for something else.

You should choose the solution that fit your needs to begin with. You can actually change later.

I decided to turbo-charge Dinero with the kontolink integration. Kontolink will automatically match entries on my bank statement with my accounting documents. This should help me focus on business and less on accounting. I am looking forward to it.

You have to put an effort into finding the solution that fits your needs. I have written a separate post on this:

How to choose an accounting system in 2023 in Denmark

Make a budget

Your business bank account cannot run empty and it is important to ensure a positive cash flow on your account. Make sure you know when to pay what.

Especially public taxes like VAT (danish: moms). Write the deadlines down in the calendar. Do not miss it.

Applying for a business insurance

You will probably need an insurance. It depends on your situation. You have to apply for it and it will take some time.

They will ask you about what services and products your offer.

You don’t need the CVR number to apply for the insurance, but your application will await the CVR number.

NemID and NemKonto

This is a specific Danish requirement.

The procedure is expected to take about a week. That is why you have to apply right away. So it can be ready for when you get approved for the bank account.

Nem means easy in Danish. Well, I am sorry to say that it is not. However, it should become easier during 2023. More about that later.

All citizens and companies registered in Denmark are required to have a NemKonto. A NemKonto is a normal bank account that you assign as your NemKonto.

NemID medarbejdersignatur

But first you have to sign up for a NemID for yourself as the first collaborator and administrator.

NemID medarbejdersignatur

You will be forwarded to this site: medarbejdersignatur.dk

You might be worried if it is a scam. The site looks like it was made by an amateur hacker. But is OK.

You sign up with your regular NemID. I know that MitID has replaced NemID, but unfortunately not in this case.

After a week you will receive a card to be able to login.

NemKonto

When you have received the letter, you can move on to NemKonto.

nemkonto.dk

Make sure that your NemKonto is pointing to your company bank account.

MitID Erhverv

MitID for companies is not ready yet at the time of writing. If you have signed up with NemID as mentioned above, you will be notified automatically. It is expected to be operational by summer 2023.

mitid-erhverv.dk

More information here: https://virk.dk/vejledning/virk-hjaelp/nemid/

Applying for a business bank account

You can use your private credit card for the very first purchases, but you need a business bank account as quickly as possible.

You need the CVR number before you can apply for the bank account.

You can find a list of Danish business banks here: Sammenligning – bedste erhvervskonti

If you are starting a personal company, you might not need the business account, but you definitely need a separate bank account for the company. Ask your bank what it costs.

What you need to prepare for the bank:

  • A description of your company, activity and possible customers.
  • A description of what experience you have to make it a success.
  • A description of who your customers are.
  • Why did you chose that bank?
  • Get your website up and running, so they can see that you are for real. See how to do that in the next section.
  • Have the money ready for the first transfer.
  • The bank will call you and they expect you to be professional. So be professional.

I chose Lunar Bank and it has been a walk in the park. They called me up after about a week and I had the account the same afternoon. They asked me the above questions. I chose Lunar because they have an integration with Dinero and because they are a “neo online bank”. For my previous French freelance company I used Qonto and I expected to be treated the same. The same day, I did the following:

When you have the account

As soon as you have been approved by the bank, do the following.

Note: If you have created an ApS you need to have a starting capital of at least 40.000 kr. that probably have to be deposited on a temporary account first. Talk with your bank and accountant about this.

  • Transfer the money. A minimum of 15.000 kr. (2.000 €) is needed to get started.
  • Order a physical credit card
  • Order a virtual credit card.

Use the virtual card for your online suppliers like the internet provider and the phone company. So that you reserve the physical card for when you are traveling or when you are buying things in a physical store.

Get a website and a blog

I have looked at a lot of tools for creating your own website and blog. The list is endless and it is hard to say what is right for you.

If you just want to start creating content and need an easy-to-use tool, I recommend Hyvor. You have your first pages and blog posts in minutes. And it support multiple languages. Most tools and websites presume that you write in English, but not Hyvor. :+1:

However, I decided to go with a site generator. Let me explain.

I wanted to write my posts in markdown and host them on GitHub pages. A lot of tools can do that, but I went with jekyll.

It was a bit more complicated to set up, but once in place, I had the freedom to maintain it locally on my computer. The GitHub repository is linked to GetHub Pages and the website is updated automatically when I push my changes.

This is where you are right now.

How did I make the company URL point to my website on GitHub pages and the app URL point to my App on Heroku? Read more about it in this article: Simple DNS Administration

Buying a computer

If you have to buy a new computer in 2023, you have some different options.

I started by getting my professional email from Google. I use Google Drive and documents a lot, but I also have Microsoft Word and Excel, of course. I worked at Microsoft.

Google documents work everywhere: Windows, macOS, Ubuntu, Raspberry Pi OS, iPad, iPhone, Android. And so does Microsoft, except maybe Ubuntu and Raspberry Pi OS, where you have to use it in the browser.

Windows

If you want to use Microsoft Windows, I only have one recommendation. Make sure it can run Windows 11 Pro. I have tested different computers and discovered that Windows 11 has some requirements to the CPU.

Apple

Apple has some really great laptops. But they are also quite expensive.

Ubuntu

If you are a little bit technical (not much), you can get an older laptop to run Ubuntu (Linux). And if you are on a budget, that might be a solution for keeping costs low to begin with.

Driving with your own car to customers and partners

It is important to track and document your mileage. That is when driving in your private or company car.

I found a really good solution for this: drivers note. You get an iBeacon, a Bluetooth device that you put in the car. Your phone can then automatically detect that you are in the car and driving. Then when you have time, you can quickly approve business trips and remove private trips.

Next steps

  • Update your LinkedIn profile.
  • Keep in touch with your network.
  • Start selling. Don’t be afraid of the phone. Pick it up now.
  • Keep a calendar with fiscal deadlines like when to declare and pay VAT.

About VAT

It can happen that you have spend more than you sold in the first quarter. If your VAT declation is negative and you should get VAT back, SKAT will ask for an explanation. Simply explain that you just started and that revenue is coming. Hopefully.

Walk and talk

You got this far and you are still hooked on the idea of starting your own company in Denmark, but you need someone to talk it over with.

Get in touch. I propose a walk ’n talk. During the COVID pandemic (2020 to 2021), we were forced to walk and talk rather than sit and talk. I had some really good experiences and will continue this great habit.

I would love to hear about your idea and help you on the way. Finn