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Achmad Ibrahim/AP
Icelandic singer Bjork

Björk Starts Venture Capital Fund, Aims to Save Iceland

January 05, 2009 05:33 PM
by Anne Szustek
The eccentric Icelandic singer and actress Björk is turning to finance in a bid to rescue her homeland’s tattered economy and preserve its environment.

Björk’s New Look: Investment Banker

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Björk’s latest side project has her turning to financial instruments to drive her message across.

The iconic Icelandic alternative pop artist is collaborating with Icelandic venture capital firm Audur Capital for a 100-million-krona (about $816,300) investment fund named after the singer that seeks to spur Iceland’s ravaged economy by way of investing in green technology.

In a recent interview with the Associated Press quoted by The New York Times, Björk said “If the money for the next aluminum smelters would go into supporting these businesses, we would be in a much better position in Iceland in five years’ time, both economically and also just image-wise or dignity-wise.” She continued, “I will not be able to live with my own conscience when my grandchildren drive around Iceland and it’s just full of factories and smelters.”

Audur has given a March deadline for prospective investors to join the fund, which will provide venture capital to local green businesses. In the meantime, the proceeds from Björk’s recently released single “Nattura,” featuring Radiohead lead singer Thom Yorke, are to go toward funding for an environmental initiative of the same name.

Audur is no stranger to socially conscious investing; the company also runs a $42 million investment fund, called “Audur I,” that funds women’s businesses. The company said on a statement on its Web site hailed Björk as “a spokeswoman for innovation, creative thinking and increased diversity in the Icelandic economy.”

Among Audur’s founders are Kristin Petursdottir, the former deputy chief executive of Kaupthing Singer & Friedlander, the British branch of recently nationalized Icelandic bank Kaupthing, as well as Halla Tomasdottir, the former managing director of the Iceland Chamber of Commerce.

Background: Iceland’s economic woes

In September and October, Iceland’s government took over the country’s three largest banks and halted trading on its stock exchange. Over 2008, the country’s currency, the krona, dropped by nearly half against the euro.

Iceland’s banking sector dwarfed the rest of the economy over the past decade. The country’s banking sector was some eight or nine times larger than its gross domestic product. High interest rates beckoned scores in foreign deposits—far exceeding locally held accounts and exposing the country to the financial ills of the world at large. Kaupthing, for one, accumulated debts stemming from funding British transactions of more than $5.2 billion within five years. Iceland’s Financial Services Authority took over the bank on Oct. 9.

This followed the nationalization of number-two Icelandic bank Landsbanki two days earlier, and the third-largest Icelandic bank, Glitnir. The latter was nationalized on Sept. 29.

IceSave, an internet bank operated by Landsbanki, was the target of U.K. government legal action after it halted all withdrawals from its accounts when it was nationalized without intending to return the funds of some 300,000 of its U.K.-based customers.

British Prime Minister Gordon Brown invoked antiterrorism legislation to freeze some £4 billion ($5.72 billion) in U.K. Landsbanki accounts.

The British treasury then seized assets of another Icelandic bank’s British subsidiary, Kaupthing Singer & Friedlander.

Iceland has asked British legal firm Lovells to explore “possible claims against the [U.K.] Treasury stemming from the Nordic country’s banking collapse.”

Icelanders have set up a Web site called Icelanders Are NOT Terrorists, with an online petition signed by more than 73,000 people, asking for an end to what it sees as abuse of the antiterrorism legislation.

Key Player: Björk Guðmundsdóttir (1965–)

Björk Guðmundsdóttir, or as per Icelandic tradition, simply Björk, is a musician, actress and activist. Born and raised in Reykjavik, the capital of Iceland, she broke out as a musician at the age of 11 with her eponymously titled debut album, released only in Iceland. She was a member of a few Reykjavik post-punk bands, the last of which, K.U.K.L., evolved into what would become the group Sykurmolarnir, which would gain prominence to English-speaking audiences as The Sugarcubes.

The Sugarcubes, known for their quirky lyrics, Björk’s ethereal vocals and bandmate Einar Örn Benediktsson’s spoken-word voiceovers, gained an international cult following through the late 1980s. After the group split in 1992, Björk pursued several solo projects, including a collaboration with Manchester electronic group 808 State, giving way to her place in the U.K. dance music scene. Nellee Hooper, who had worked with Massive Attack, co-produced along with Björk her first solo album, “Debut,” released in 1993.

She has since put out several albums, remixes and compilations, among them “Selmasongs,” her soundtrack to the 2000 movie “Dancer in the Dark.” The movie, which starred Björk, won the Palme d’Or at the Cannes Film Festival and earned the singer a trip to the 2001 Academy Awards, where she wore her now-infamous dress that looked like a swan.

On the political activism front, Björk’s shouting of “Tibet! Tibet!” following a 2008 performance in China of her song “Declare Independence” provoked national outrage.

Reference: Nattura, Björk capital fund

Related Topic: Midnight Oil frontman becomes environmental minister

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