Freda's €1.8 Billion Lesson: Why Some Startups Can't Start Small

By Grace Kim

Daniel Kjellén sold open banking platform Tink to Visa for €1.8 billion (about $1.9 billion) in 2022 — and he says his new startup could never have worked as a minimum viable product.

Kjellén, CEO and co-founder of Freda, the Stockholm-based AI-native compliance company that came out of stealth in September 2026, argues that some problems are simply too big for the standard startup playbook. Compliance is one of them.

"'Solving compliance' was a mission akin to fighting the Hydra: cut off one head and two more grow back," Kjellén wrote. "There is no minimum viable product here. Fixing one head changes nothing. What it takes is a maximum viable product from day one."

What broke the classic playbook?

A first venture usually follows a well-worn path: find a market gap, refine the concept and pitch, then narrow everything down during product-market fit. Founders spend their first years proving the idea can make money and scale, while the grand vision sits on pause.

That path exists for a reason, Kjellén notes. Investors backing a first-time founder write a small check and back a narrow product, limiting what everyone stands to lose.

But compliance doesn't slice that way. Every company's obligations depend on countless factors scattered across departments that rarely talk to each other.

• Legal tracks regulations; a separate department oversees implementation.
• Product teams make feature calls; another team checks whether those calls were compliant.
• Policies, standards and regulations sit with entirely different departments — usually the silo with a clear buyer and a budget.

That fragmentation, in Kjellén's telling, is why piecemeal compliance tools keep failing.

Why the second time is different

Kjellén and co-founder Fredrik Hedberg built Tink from its 2012 founding into a multimarket operation with roughly 700 employees operating under a host of European regulators. He says scaling that company taught him how painful compliance can be: small wording tweaks, reviews that dragged on for months, and perpetual uncertainty that stopped fast iteration. Products were often delayed by months — a slip that meant the world in a fast-moving industry.

After the Visa exit, the pair had their own war chest and, for the first time, the experience and resources to attempt something bigger. A successful first exit opens doors to talent, partners and investors that simply weren't available with Tink, Kjellén says. It also means they can fund the full build themselves, so no investor asks them to shrink the idea before testing it.

The pattern isn't unique to them. Kjellén points to Stockholm's bench of Spotify and Klarna alumni who used credibility from first successes to found and back harder ventures.

Can 22 people do what once took hundreds?

Experience and capital used to cap how far a second-time founder could stretch. Ten years ago, building something as broad as Freda would have required hundreds of people across many disciplines and many years, Kjellén says.

Language models changed the math. Freda's team today is 22 strong and growing, and ships at a pace Kjellén says he could only dream of when building Tink.

He also credits 15 years of entrepreneurial bruises — knowing setbacks are coming, and knowing a venture is a team marathon rather than a one-man sprint. None of that guarantees success, he concedes, but it's a good starting position for building the biggest vision yet.

The bet, then, is that AI compression plus founder capital lets a 22-person team attack a problem that previously demanded hundreds — and that Freda's maximum viable product can beat the compliance Hydra where narrow tools couldn't.