The Propeller that Built Norway

Hans Nielsen Hauge (1771 – 1824) and his network forever changed Norway. The Europe of today needs more groups of friends creating jobs for themselves and others.

200 years ago, a farmer’s son from Tune in Østfold County created what was to become arguably Norway’s first popular movement. In addition to fighting for freedom of religion and expression, he and the growing number of people in his network were driven entrepreneurs, investors and angel investors, who started one enterprise after another all around the country.

During the eight years between 1796 and 1804, and especially during the last five and most effective years of entrepreneurship, Hauge started 30 businesses. If we include the nascent companies he invested in, or was otherwise directly involved in, the number jumps to 150.

In a society that was regularly struck by food shortages and where social mobility was difficult, this had a great impact. As many as 7/8000 were employed at companies owned by Hauge, which means that almost 1% of the working population at the time was employed by Hauge.

On the investment front 1804 was a peak year. Hauge channelled over NOK600 million in today’s money into new businesses, more than one per cent of the gross national investment at the time.

Hauge and those that followed him – also known as Haugeans – created political opposition to king and official rule, they founded schools and social enterprises, volunteer associations and paved the way for the emergence of the welfare state. Considering this, they also paved the way for Norway’s democratization.

Rise of the People

As a young man, Hauge was ambitious and endeavoured to achieve the same status as the economic and cultural elite. Norway had no aristocracy per se, but a rich and powerful class of merchant patricians. The glass ceiling was palpable. Hauge’s breakthrough came when he had what he described as a powerful meeting with God in his father’s field in Østfold in April 1796.

After this defining moment he realized he was good enough for both God and the elite. It gave him an incredible feeling of freedom, and a yearning to bring others to the Creator. However this would prove to be a challenge. The church monopolized proselytization through the “Conventicle Act”, which forbade groups of people gathering to read the bible without informing the local vicar. When Hauge started preaching and visiting townships and cities all across Norway, household after household became part of the network of friends that contributed to Hauge’s free ideas. Although Hauge didn’t intend to cause national unrest, his movement helped empower farmers and fishermen with a new responsibility for their own lives.

Commoners were more than ready to receive his message. Politically there had already been tendencies over the preceding years towards opposition to strict royal and government control over the people. Rules like the Conventicle Act and passport requirements for domestic travel had curtailed people’s freedom. In the 1790s, Kristian Lofthus led the “Lofthus Uprising”, a protest against the onerous taxation. It was brutally crushed and Lofthus himself was jailed and died in custody in 1797.

Hauge was, besides being a preacher and a serial entrepreneur, also a writer. To describe the size of the network that would grow to the Haugean social movement, which has influenced the growth of current-day Norway from the 19th century, the number of books written by Hauge may serve as an example. For a population of around 800,000 people, many of his books sold around 200,000 copies. To manage this level of production, he purchased and started a number of printing shops.

The Network of Friends

Three main qualities characterized the movement that arose in Hauge’s wake. The first was faith in God and the awakening to a more active Christian life. The reason this was liberating was that the Haugeans took back the right to interpret the Bible on their own, and didn’t accept the government clergy’s monopoly on religious practice.

The Haugeans’ second obvious quality was their building of close ties and fellowship, which contributed to creating new networks of social relations both locally and nationally. Townships in Norway were brought together for the first time, because Haugeans in Hedmark County knew they had likeminded fellows in Stavanger. For the Haugeans inspiration came from Jesus’ command to love thy neighbour like thyself. In Sigbjørn Ravnåsens biography of Hauge, we find: “Friends shall endeavour to be frugal and think of their fellows. Such attitudes cannot be developed in egocentric spaces, but in a community where people show humility and let consideration for their fellow man be the key tenet.”

The final evident quality among Haugeans was their serial founding. With the success of the many businesses they started, came their desired social mobility and community creation. If an entrepreneur profited from a new enterprise he had started, he wouldn’t immediately order new furniture from the continent. Rather, the goal was to establish a private investment fund that other Haugeans could benefit from when they tried starting a business. This also made for social security in a time that lacked the safety net of the welfare state.

Equipping people at grass-roots level in this way helped raise large portions of the populace to the relatively classless society we benefit from today. In addition to this historic effect, we can still see traces of Hauge’s work. Hauge’s followers started companies such as Møllers Tran, Lilleborg, and Ekornes in Sunnmøre. Other sectors heavily influenced by Haugeans to today include the fishing and shipping industry along the Norwegian coast.

The New Haugeanism

Hans Nielsen Hauge became an increasingly large threat to the authorities’ quest for control. After a series of short stays in jail, for crimes including breaking the Conventicle Act and traveling and trading without permission, he was imprisoned for ten years in 1804 (excluding a period of freedom during 1809, when the authorities required his expertise to start salt production during the Napoleonic Wars). His case was consistently delayed and Hauge was released, a broken man, in 1814. Nevertheless during his final years he ran several farms in Oslo until his death in 1824.

Together with other currents coursing through the population during the 1800s, the Haugeans and their descendants increasingly took places at the tables where the country’s future in various areas would be determined. From being paupers and peasants, they grew to influence the creation of modern-day Norway.

What can we learn from the Haugeans’ community building? Firstly, we can see how networks and faith can be a driving force for the will to take chances and take entrepreneurial initiative. Both the social fellowship of their network of friends and their focus on building communities are worth remembering for us as modern entrepreneurs. The power of groups of friends, who built complementary teams, is still important for building businesses with growth potential.

Secondly, their frugal ideals made it possible to use profits not just to increase their own consumption, but rather to reinvest in new businesses. If new jobs are to be created in Europe, ordinary wage earners also have to dare to invest in newly established businesses. First-phase seed money is scarce in Europe, despite enormous surpluses of capital globally.

Thirdly, and perhaps most importantly, it’s OK to have ambition and to become good at something. If European startups are ever going to grow beyond small, the will to build something big has to be there.

“Hans Nielsen Hauge is one of the most influential characters in Norwegian history,” wrote historian Karsten Alnæs. Hans Nielsen Hauge was likely one of the most important figures in Norway’s transformation from a relatively poor agrarian society to a modern, industrial society. Nothing less. The author Arne Garborg even wrote in the novel Trætte Mænd [Tired Men]: “It wasn’t Henrik Wergeland, but Hans Nielsen Hauge, who made 19th century Norway.”

The legacy of the Hauge network is still evident – Norwegians are good entrepreneurs. Going forward, we have to show that we can also create those big businesses that provide jobs for the masses.

This article was first published as an appendix in the book «Startup Europe - The Entrepreneurs Transforming Europe» written by Hermund Haaland and Nicolai Strøm-Olsen in 2016. The book may be purchased as an e-book here - or as a hardcover version by sending us an e-mail at post@zebr.xyz. 2021 was celebrated as a commemoration to him, as he was born 250 years ago.