Grandmothers and housewives keeping dusty paper certificates in their kitchen cupboards for decades is not unknown to the world. But families suddenly gaining more capital than their local bank left many stock market analysts amazed. In the late 1990s, Nokia emerged as one of the fastest-growing technology companies in the world. However, its success revolutionised the Finnish economy and generated immense fortunes for its investors. Nevertheless, the biggest surprises came from sources other than professional traders or investment firms. These were the everyday Finnish families.As years went by, tales sprang up regarding the arrival of elderly ladies to local banks holding shares of Nokia that had been stored for decades in their kitchens’ drawers or cupboards. Local sources claim many were surprised to find out their long-forgotten shares had appreciated to astronomical levels of value.Although it’s hard to believe, the overall phenomenon is very much true. The shares of Nokia appreciated at an incredibly high rate in the period of the mobile phone revolution of the nineties.Nokia began far away from mobile phonesThe brand’s association with mobile phones and communications is almost synonymous today. Yet, it was initially run as a classic industrial enterprise in Finland. According to the official history of Nokia Corporation, it manufactured everything from paper to cables, rubber boots to tyres.The firm had deep roots in Nokia, a Finnish town near Tampere. Over the years, locals frequently bought shares in the firm by inheriting, participating in employee schemes, or investing directly.Back then, owning stocks was different from today’s electronic stock market systems. Many people kept the paper stock certificates at home for several years while ignoring the increasing value of their stocks. Nevertheless, these old certificates would turn out to be priceless later than ever expected.Nokia’s risky move with mobile phones paid offTowards the late 1980s, Nokia experienced significant business difficulties. The firm had grown into a diversified and complex organisation to manage. This situation transformed when Jorma Ollila took up the role of CEO.Nokia started divesting itself from its traditional industries and concentrated on telecommunications and the developing market for GSM mobile phones. From a historical business perspective, this is considered one of the best strategic decisions ever made in the tech industry.The strategy worked. According to Nokia’s 1998 annual report, the company became the biggest producer of mobile phones globally. It also reported that the value of its stocks increased by more than 220 percent in 1998.Nokia saw its stock soar between 1992 and 2000 as mobile phones gained popularity on the world market.
Why families who never sold Nokia shares got rich unexpectedly. Image credit – Wikimedia
Patience proved to be a great asset to the Finn familiesWhile traders in London and New York bought and sold Nokia stocks, ordinary Finnish families just kept them for decades. Their patience paid off immensely.Some thought of them as a contingency fund, not an investment. Others had inherited them from family members associated with the company or the city. Since they did not feel compelled to sell whenever prices rose slightly, many took advantage of the stock’s tremendous increase during the latter half of the decade.The tales of old ladies discovering their sudden fortune at the bank became legendary in the Finnish business community since such stories were common across the country.According to Martti Häikiö, a Finnish historian specialising in business and finance, Nokia made a huge impact on Finnish society beyond its economic success.Nokia made Finland’s greatest technology company success storyThough the actual tale of the grandmother at the bank may be hard to authenticate via official sources, there have been several accounts that can be validated.An excellent case in point was Onni Nurmi, a Finnish entrepreneur who contributed Nokia stocks to the city of Pukkila. According to various archival reports, the soaring stock prices of Nokia caused the value of the contributed shares to rise to tens of millions of Finnish marks.Such cases further strengthened the notion that well-timed investments in Nokia would make anyone a millionaire overnight. Nokia’s success story became the biggest in EuropeToward the late 1990s, Nokia emerged as the largest company in Europe and a benchmark for Finland’s modernising economy. Nokia phones such as the 3210 model and the 3310 model became worldwide hits.Economic researchers from the Bank of Finland later calculated that Nokia accounted a great part of Finland’s economic growth during its peak period. The effects of its activity did not stop at technology. They impacted the labour market, exports, financial markets, and even the country’s national image.The reasons why Nokia’s story is still relevantThe tales of Nokia millionaires remain popular precisely because they merge multiple appealing notions simultaneously. They speak of the randomness in the evolution of technologies. They show the importance of patience in the field of investing.Perhaps, most notably, they show people that any economic revolution does not necessarily pay off to professionals. Sometimes, regular families make money just by holding on to what others ignore.After all, the spectacular success of Nokia really made worthless papers into valuable assets in the hands of many ordinary Finnish families.
