The annual value of public procurement in Sweden is approximately SEK 800 billion (Upphandlingsmyndigheten 2020). Sweden published its innovation strategy in 2012, with an aim to create stronger innovation climate and capacity and to make the majority of Swedish public procurements innovation-friendly (Regeringskansliet 2012). The national procurement strategy of 2016 and the national strategy on social enterprises from 2017 have continued this work. Five strategic collaboration programmes were launched to create new links between the public sector, businesses, and academia to better meet the objectives of the strategy, and the government assigned the Swedish Agency for Economic and Regional Growth (Tillväxtverket, under the Ministry of Enterprise and Innovation) to support regional social innovation initiatives and prepare a national programme for utilizing social enterprises to boost employment. 

The 2017 social enterprises strategy includes several policy measures such as generating need in the public sector for social innovations, increasing business counselling and knowledge about public and private investments, developing a methods evaluation of social innovation impact, and supporting related knowledge hubs and network arenas. For this work, Tillväxtverket was granted SEK 20 million annually for the years 2018-2020. Furthermore, the budget proposition of 2018 directed SEK 50 million for promoting social enterprises (Karolinska Universitetssjukhuset et al. 2017; Regeringskansliet 2018). This strategy has been considered successful because it was well-timed to align with funding resources; 3 years later, in 2021, many of the initiatives had stopped as they were no longer connected to supporting financial structures (Ashoka et al. 2021). 

In February 2022, the rules of public procurement were simplified to support more flexibility in procuring services, leaving more room for designing each procurement case to match the organisations’ goals. However, the reform requires more paper work by the contracting organisations as they must now describe the procurement process in detail (Upphandlingsmyndigheten 2022b).

Innovation procurement promotes the development and implementation of innovative and sustainable solutions. Its aim is not procuring innovations but setting the intention that a contracting public institution promotes innovation in its procurement process by requesting or allowing new solutions (Edquist 2014; Upphandlingsmyndigheten 2021). Another variation focuses on functional procurement requirements. When procuring with functional requirements, the contracting organisation describes the needs that must be met or the effect that must be achieved, and then lets the tenderers decide how to proceed. By requesting an outcome or effect instead of a specific solution, innovative solutions and novel actors have more space to participate in procurement (Regeringskanseliet 2010). The functional procurement requirement approach resembles SIBs (described in a later section of this report). 

A report by the Swedish Competition Authority (Konkurrenceverket) states that the state, regional, and local governments should reserve fiscal space for conducting procurement in a manner that promotes innovation. It is important that politicians make it clear—to themselves and others—that they must take and “be responsible for” decisions to conduct public innovation procurement, innovation-friendly procurement, and pre-commercial procurement (Edquist 2014). The report also stresses that administrators, policymakers, and decision-makers must be the ones implementing innovation-related procurement (Edquist 2014; Upphandlingsmyndigheten 2021). 

National support measures also encompass social entrepreneurs and companies, as the Swedish government views supporting social entrepreneurs as a way to reach the UN SDGs for 2030. The current Swedish strategy for supporting social enterprises aims for long-term development, and the government proposed SEK 50 million in the 2018 budget to be reserved for improving their prospects and promoting knowledge dissemination and practical know-how around the subject (Regeringskansliet 2018). Sweden’s first social entrepreneurship incubator, Center för Socialt Entreprenörskap (CSES), began its work in 2011 and works with several EU-funded projects as well, such as Erasmus+ and the EDIN network (CSES website 2022). In addition, Region Stockholm and several universities are active in the field, for example, in the form of Mötesplats Social Innovation, which is the main national knowledge platform and network for promoting social innovations (Vinnova 2018); (Mötesplats Social Innovation 2022). However, studies have pointed out that funding via incubators and supporting intermediaries is unstable, resulting in many short-term projects. One consequence of this is the time consumption for constantly applying for new funds to prolong the work, which can detract from accomplishing the work which has societal impact. Furthermore, in a study published in 2021, 70% of social enterprises reported not having received intermediary support from these organisations (Ashoka et al. 2021; Mötesplats Social Innovation 2021). 

Several Swedish incubators are increasingly interested in working with SIBs or other social investment models in the near future (Good and Juhlin 2020). The national instrument is national research institute RISE, specifically its Social and Health Impact Centre (SHIC). SHIC was established to act similarly to the Finnish institution Sitra by aiding municipalities, regions, and authorities with setting up SIBs and operating a model known as the National Outcomes Fund  (RISE 2022). Other institutional tools include the National Procurement Agency, which, together with the Legal, Financial, and Administrative Services Agency (Kammarkollegiet), makes up a competence centre for innovation procurement under the EU project Procure2Innovate. The project ran from 2018-2022, with involvement from the Finnish competence centre KEINO as well (Upphandlingsmyndigheten 2022a). Current knowledge initiatives include a group that the Svenska Standard SIS has set up with the organisation Effective, the auditing firm PWC, and the Swedish National Advisory Board to develop a Swedish standard for social impact measurement. In addition, a meeting place called Social Innovation at Malmö University, together with four other Swedish universities and the foundations Reach for Change and Inkludera, received funding from the European Commission for cooperating with actors from France, Spain, and Latvia to form a European competence centre for social innovation, running from 2021 to 2023.These examples illustrate the ways that institutional networks are working in the Swedish context to support impact start-ups.