Protean Small Cap declined by -0.9% in March. The benchmark index declined -3.1%. Since launching in June 2023, the fund has gained 55.6%. The Carnegie Nordic Small Cap Index is up 22.1% in the same period.
The hedge fund Protean Select returned 0.5% in March.
Protean Aktiesparfond Norden returned -2.8%. The benchmark was down by -2.6%. Since inception, twelve months ago, the fund is up 18.3%, and in the same period the VINX Nordic Cap index is up 12.8%. The fund now manages 1.7bn SEK.
All figures are net of fees.
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This month’s letter elaborates on Aktiesparfonden’s encouraging first year, the Fog of War that plagued markets in March, why we remain cautious but not as cautious as mid-March and why we were unusually active. Plus, as always, commentary on the month’s various winners and losers.
Thank you for being an investor!
// Team Protean
Nowhere to hide
March 2026 • Written by Pontus Dackmo
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Wouldn’t it have been convenient to write this month’s missive about something completely different? A company deep-dive, a reflection on Nordic small cap valuations, perhaps an observation about the underappreciated capital cycle in some obscure industrial niche. We’d have preferred that. You’d probably have preferred that too.
The instinct, as a Nordic-focused fund manager, is to treat geopolitical events as background noise. We don’t trade oil futures, we don’t run a macro fund, and we certainly don’t have an edge on the intentions of the Iranian Revolutionary Guard or US Commander in Chief. It would be comfortable to dismiss the Middle East crisis as someone else’s problem and retreat to the familiar terrain of Nordic company fundamentals.
The problem is: there is no such retreat. An inconvenient fact about the Nordic equity markets is that most of our listed companies have international operations and are deeply embedded in global supply chains. A Swedish industrial company might report in kronor, hold its AGM in Stockholm, and have a thoroughly Nordic board – but its input costs are denominated in dollars, its customers are in Germany and China, and its order book is a function of global capex cycles. An energy shock in the Strait of Hormuz doesn’t stop at the Persian Gulf. It travels through Brent crude, through European gas prices, through the front end of rate curves, through the krona, through sentiment, and eventually lands on the desk of a CFO in a mid-sized Swedish town, wondering whether to revise guidance.
There is nowhere to hide from a physical supply shock. Not in Scandinavia, not in small caps, not in “quality compounders”.
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The fog
General Carl von Clausewitz coined the term “fog of war” almost two centuries ago. In the chaos of conflict, the information available to decision-makers is incomplete, contradictory, and often deliberately
misleading. The rational response, he argued, is not to seek certainty, but to make decisions robust enough to survive being wrong.
March offered a masterclass in modern fog of war, except now the fog is generated not by cannon smoke but by tweets and nonsense.
We have no edge in forecasting the outcome of the Middle East conflict. None. We do not know whether the Strait of Hormuz will reopen next week or remain contested for months. We do not know if escalation leads to a ground operation or if a face-saving deal materializes over Easter. And critically, we don’t think anyone else knows either – regardless of how confidently they narrate it. What we can control is how we position for the range of outcomes.
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Active Portfolio Management
March was, in all likelihood, the most active month we have had in a long while. Possibly ever.
That warrants some explanation. We do not celebrate turnover. Trading is, at its core, a necessary evil since every ticket is connected to a commission cost borne by the fund, every spread has two sides. We are fully aware that activity for activity’s sake is a reliable way to erode returns whilst just producing a feeling of being busy.
What happened in March is that prices moved, on a daily basis, in ways that had very little to do with company fundamentals. Tariff announcements, reversals, threats, walk-backs – the signal-to-noise ratio collapsed. When the market reprices a business by 10% because a politician said something on a Sunday, and then reprices it back 8% two days later, the question we ask ourselves is not “should we trade?” but “can we afford not to?” The disconnect between price and value was, on certain days, wide enough to drive a truck through.
So we traded. We trimmed things that moved too far. We added to things that got dragged down indiscriminately.
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We do not fetishize this. The goal is never to be active. It is to own businesses at prices that make sense. Some months that means sitting on our hands. March was not that month. When the market hands you volatility as a gift, and the underlying thesis hasn’t changed, the correct response is to use it.
The honest addendum: a fair few trades in March were wrong. Some we were too early on; some we shouldn’t have touched at all. Elevated activity is a double-edged sword: more opportunities to profit, but also more chances being wrong.
What we’re watching
The honest answer is: we’re watching the same thing as everyone else. The Middle East. The Strait of Hormuz. The oil price. But we’re also watching for the second-order effects that tend to arrive with a lag and matter more than the headlines.
More speculatively: we are watching for the moment when the market shifts from treating this as a binary event (resolved / not resolved) to treating it as a new baseline. That shift, when it happens, tends to be where opportunity is greatest. Because once the question changes from “will things go back to normal?” to “what does the new normal look like?”, the answer requires fundamental analysis rather than geopolitical punditry.
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But you don’t always need to wait for the fog to lift. Some conclusions are robust regardless of how the binary question resolves. Here’s an example from our own process.
In the middle of March, we bought a meaningful amount of Nibe (NDYLF) (NDYLF). The thesis is not that the war ends tomorrow, nor that it drags on for months. The thesis is that regardless of outcome, this crisis will put energy efficiency and reduced oil dependence back on the political agenda across Europe – forcefully, and probably durably. It happened after the 2022 Ukraine shock, when heat pump sales exploded and energy renovation became a political priority. That impulse then faded as gas prices normalised and populist backlash pushed governments to soften their climate ambitions. Well, here we are again. Except this time, the lesson should be harder to forget: Europe’s energy dependence is not a theoretical risk discussed at think tanks. It’s a physical vulnerability that disrupts economies when things go wrong in places we can’t control.
Nibe is the dominant European manufacturer of heat pumps. The stock has been in the penalty box for two years – inventory destocking, normalising demand, increasing competition, a weak Swedish housing market. It’s down 70% from its peak. We think the market is pricing a permanently impaired business, while the structural case for energy-efficient heating has just been handed another powerful catalyst.
This is the kind of analysis we prefer: not “will there be a ceasefire by April 6th?” but “what is likely true about the world on the other side of this, no matter what?” The best investments tend to come from conclusions that don’t depend on the impossible task of predicting the unpredictable.
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Aktiesparfond Norden – One Year In
March 31st marked one year since launch. The fund has returned +18.3% against the VBCSKN index’s +12.8%. That is an outperformance of 5.5%.
Twelve months is not a track record. It’s a start. A better start than a bad start, which is all we’ll claim.
The more instructive number is the 1.7bn SEK in assets attracted. To understand why that matters, you need to remember the problem we set out to solve.
The active fund management industry has a well-documented flaw: virtually all serious research shows that actively managed funds underperform their benchmarks after fees. Not because the underlying stock-picking is necessarily bad, but because fees are too high, portfolios too bloated, and the incentive structure backwards. Fund companies optimize for asset gathering. Banks optimize for captive distribution. Neither optimizes for the person actually trying to compound their savings.
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The obvious counter is the index fund. Cheap, transparent, honest. Except it owns everything indiscriminately – the frauds, the fads, the structurally declining businesses – with no judgment or overlay.
Our argument has always been that there is a gap between these two options. A white space that nobody has an incentive to fill: a low-fee, genuinely active, long-term oriented fund owning decent Nordic businesses. Just a manager with skin in the game, focused on long-term cash flow generation, making decisions without anyone else’s approval required.
The Aktiesparfond was built on the premise that a long-term Nordic saver deserves access to that kind of independent, genuinely active management. At 0.5% per year, with daily liquidity, alongside every expensive active fund and index fund in existence.
That 1.7bn SEK after one year suggests the gap was real. Whether the performance holds is a separate question, the last one year tells us almost nothing with statistical significance. But the structure is working, the thesis is intact, and the alignment of interests remains the foundation.
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A Punch In The Mouth
The Prussian military strategist Helmuth von Moltke was a contemporary of Clausewitz. He is remembered for the observation that no plan survives first contact with the enemy (a version of which Mike Tyson famously converted to “Everyone has a plan until they get punched in the mouth.”). The investment equivalent is that no portfolio survives first contact with a real-world shock.
We came into 2026 positioned for a world of monetary tailwinds, deregulation, and an improving European outlook. That world has been interrupted – perhaps temporarily, perhaps not.
Months like March are uncomfortable. They are supposed to be. Comfort is rarely where returns are found. We remind ourselves – and you – that our process is designed to compound over years, not months. The key is to stay in the game, avoid big draw-downs, suffer intelligently when suffering is unavoidable, and be ready to act when the fog lifts.
Thank you for being an investor.
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// Team Protean
Protean Select
March 2026 • Written by Pontus Dackmo
Protean Select returned +0.5% in March. After two softer months to start the year, this is a welcome result, and more importantly, it is the kind of month that gives the strategy its reason for existing.
Nordic indices were down between 5 and 10% this month, depending on which one you pick. We ran an average net exposure of around 20%. The fund made a small positive return. That is roughly what we designed this thing to do.
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We are not a market-neutral fund. Or a short-biased fund. We are a fund that believes, with some conviction, that things generally want to work out in the end, and that the majority of long-term returns are made by owning businesses, not by being overly clever about when to be short them. That belief is why we almost always keep a positive net exposure, even in difficult conditions. The shorts are there not just to make money in isolation, but to act as an airbag: you don’t drive with an airbag hoping it deploys, but you’re grateful it’s there when it does. Like this month.
Biggest contributors were the OMX future short position (plus put-spread), Rusta long, NIBE long and Electrolux (ELUXY) short, in that order.
Biggest detractors were Devyser, Lundin Mining (LUNMF) (although offset by a short in Boliden (BDNNY) (BDNNY)), Volvo (VLVLY) and Getinge (GNGBY) long positions.
We enter April at 19% net exposure. Gross is now at 117%, having nudged it upward from more cautious levels, moving gradually back toward our historical average of around 135%. This is a deliberate, incremental decision, not a conviction call. The market feels non-linear right now. If conditions continue to feel constructive enough to justify additional risk, we will add. If not, we won’t.
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We said going into the year that we wanted to earn the right to take more risk. March was a small step in that direction. Let’s see what April has to say about it.
Lowering the capacity limit
We announced during the month that we are lowering the capacity limit for Protean Select from SEK 2 billion to SEK 1 billion. The fund currently manages approximately SEK 970 million. We are, in other words, very close.
Some context. When we originally set the cap at SEK 2 billion, we assessed capacity based on the fund in isolation. That was reasonable at the time. But circumstances have changed. We now manage institutional mandates alongside the fund, applying a similar investment strategy in the same universe of Nordic small- and midcap companies. Running larger aggregate capital through the same opportunity set degrades the things that matter most: execution quality, the ability to take meaningful positions in less liquid names, and the speed of decision-making that comes with being small. We’d rather close too early than too late.
Here is how it will work. Once we pass SEK 1 billion, we will communicate that the fund is closing. There will then be a final subscription window of approximately one month. After that, the fund is closed to new capital. Withdrawals are always possible – this only affects new deposits.
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Readers of these letters will recognise the philosophy.
We have said since day one that we optimise for performance, not for convenience, size, or marketing. We have written at length – perhaps at tedious length – about the perverse incentives in fund management, how AUM-maximising behaviour dilutes returns, and how size is one of the primary ways performance dies. We have said we would cap the fund early. We have said we would sacrifice revenue for return quality. And now, approaching the moment where those words become action, it feels worth pausing to acknowledge what this means.
On a personal level, the prospect of actually closing the fund is a source of pride. Not because turning away capital is clever business – it obviously isn’t. But because it means we are doing what we said we would do. When we started Protean, the motivation was to invest our own savings in an institutional setting, not to build an asset gathering machine. Every structural choice we’ve made has pointed in this direction: the quarterly redemptions that scare off allocators, the size cap that limits our fee income, the high hurdle rates that make performance fees genuinely hard to earn. None of this is “How to Build a Big Profitable Fund Management Business”. If there were a textbook on the subject, we’d feature as a cautionary tale.
But here’s the thing. Almost four years in, the fund has delivered competitive risk-adjusted returns. We even won an actual prize for it. Assets have grown to the cap not through marketing campaigns, but through performance and word of mouth. Our investors include some of the most sophisticated allocators we know, alongside friends, family, and our own savings. That this motley crew has collectively brought us to the point of closure feels like vindication of a philosophy.
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We recognise this limits flexibility for both existing and prospective investors. That trade-off is deliberate. Protecting the conditions for good long-term returns is, in our view, the most important thing we can do for the people who have already entrusted us with their capital.
Protean Small Cap
March 2026 • Written by Carl Gustafsson
Protean Small Cap returned -0.9% in March. Our benchmark CSRXN (SEK) was down -3.1% during the month. Hence, the fund outperformed the index by 2.3%. Since inception in June 2023, the fund has outperformed the index by 33.5%. Total performance since inception is 55.6% net of fees.
The fund now manages c. SEK 990m following a continued inflow of funds, thank you for believing in us.
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March recap
Top contributors were Cint, Rusta, BTS, Smartoptics and Nibe. Notable detractors were Devyser, Balder (BALDY) (BALDY), Arctic Falls, Nyfosa and ITAB.
Cint reported a considerable sequential improvement in sales during the fourth quarter and we increased our stake in the company on the day of the report in February. Since then, the share has continued to climb and it became our biggest contributor in March. It’s not a stock for widows and orphans but we believe the market is underestimating the growth opportunity within the business area Media Measurement. We acknowledge a string of operational issues, as well as about the impact of AI on the market research sector, but Q3 was likely the trough in terms of pain. The valuation is very appealing.
Rusta reported a very strong quarter, where the benefits of the stronger SEK started to have an impact. Healthy LFL, as well as a firmer outlook for store openings, lead to share to gain in an otherwise gloomy March for consumer exposure.
On the detractor side, Devyser continued its slump, with the share down by a third year to date. As we write this, the share now trades below its IPO price from 2021, despite clearly approaching cash-flow break-even and strong growth prospects in several areas. Devyser is active within genetic testing where DNA is used to assess disease risk as well as detecting them. Introducing new testing protocols takes time, but they are very sticky once established. The market might have overestimated the speed at which Devyser can establish itself, but we believe it underestimates the duration of the opportunity.
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Balder and Nyfosa suffered from concerns over long-term rates.
While March was less busy in terms of portfolio activity, we take the opportunity to catch-up on some of the changes we have made so far this year.
We have added Vimian as a mid-sized position. This is a Swedish animal health company, focusing mainly on pets. It has a relatively broad product offering partly due to an opportunistic acquisition strategy. As for many others, a string of acquisitions during the pandemic led to some issues, financially as well as operationally. The financial issues were resolved through a rights issue, while the operational issues have been gradually, but not fully, addressed through restructuring and cost savings.
Where does the attraction lie? Q4 was strong with improved earnings quality, as well as stronger cash flow. This positive step has been disregarded in the overall market turmoil, and the share is trading at the low-end of its post-pandemic range, and considerably below levels where the main owner Fidelio (the PE sponsor that owns 60% of the stock) has added shares as recently as this autumn. The valuation does not fully capture the thematic exposure, we believe. With continued margin improvement, a return to more M&A and upside towards sector valuation, we see good risk/reward.
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We have also added smaller stakes in a few interesting growth stories where shares can typically be hard to come by. These include Vertiseit , which describes itself as a supplier of “in-store Experience Management (IXM) platforms”. This can be translated into ‘software that runs all the screens you see in stores’ to simplify. The appeal of the business lies in the execution, we believe. The company is led by owner-operators who have ten-folded annual recurring revenue over the last decade. This is partly due to organic growth but also complemented by successful acquisitions where there are considerable synergies that can be extracted. We visited Grassfish, one of Vertiseit’s subsidiaries, in Vienna earlier this month, and were enthused by the growth opportunities that remain.
We have exited our positions in Hexpol and Sinch (as the buyback programme we alluded to last month led to some outperformance and provided a window of exit).
Our top ten positions as we enter April are as follows:
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Rank
Holding
% of portfolio
Rank
Holding
% of portfolio
1
Acast
4.5%
6
ITAB
3.3%
2
Storytel
4.1%
7
Storskogen
3.2%
3
Sdiptech
4.0%
8
Vimian
3.2%
4
BTS
3.7%
9
Devyser
3.1%
5
Cint
3.5%
10
Vitec
3.0%
Protean Aktiesparfond Norden
MARCH 2026 • WRITTEN BY RICHARD BRÅSE
Aktiesparfonden is a Nordic long-only fund aiming to generate above-market returns over the long term by active investing in value-creating companies and charging a low fee. A fee that is reduced further as the fund grows, sharing the scale advantages with investors.
Aktiesparfonden has, since inception one year ago, delivered a 18.3% return, in the same period the VINX Nordic Cap index is up 12.8% . The fund now manages 1.7bn SEK.
Our communication for Aktiesparfonden is currently only in Swedish, and updates can be found at www.aktiesparfonden.se by clicking the headline “Anslagstavla”.
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Thank you for your long-term perspective and trust in our process.
Thank you for being an investor.
Pontus Dackmo CEO & Investment Manager Protean Funds Scandinavia AB
The monthly reminder
We optimize for performance, not for convenience, size, or marketing. You can withdraw money only quarterly in Select (monthly in Small Cap). We will tell you very little about our holdings. Our strategy is tricky to describe as we aim to be versatile. A hedge fund can lose money even if markets are up. We charge a performance fee if we do well. You do not get a discount if you have a larger sum to invest. We only have a medium-sized track record.
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Aktiesparfonden’s reminder
We aim to generate above index returns over 3-5 years, but there are no guarantees. The fund is traded daily, but that doesn’t mean you should. To beat the index, you need to deviate from the index. This means taking uncomfortable positions. Be aware that the fund can underperform the index during periods. Sometimes, long periods. We lower the fee as the fund grows. The first 10 basis point cut comes at 10bn SEK in AUM.
PepsiCo (PEP) exits London festival sponsorship after Kanye West named headliner. (00:14) UK tries to woo Anthropic to expand in London amid US clash: report. (01:05) Soleno Therapeutics (SNO) rallies on report of $2.5B Neurocrine (NBIX) buyout talks. (02:20)
West, who now goes by Ye, was recently announced as the headline act for the Wireless Festival, set to take place in July at Finsbury Park. Organizers had promoted the event under the branding “Pepsi Max Presents Wireless,” but the beverage giant confirmed it would no longer be involved.
The artist is scheduled to perform across all three days of the festival as part of a broader effort to reestablish his career after years of controversy.
The booking has also drawn political scrutiny in the U.K. Prime Minister Keir Starmer described the decision as troubling in comments to a British tabloid, adding to pressure surrounding the event.
It comes as a fight continues to brew between the AI startup and the U.S. Department of War.
The Financial Times reported that staff at the U.K.’s Department for Science, Innovation and Technology have written proposals for Anthropic, which include an office expansion in London and a dual listing.
Anthropic and the Department for Science, Innovation and Technology did not immediately respond to a request for comment from Seeking Alpha.
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Anthropic’s CEO Dario Amodei is set to visit Britain in late May as part of a trip to meet European customers and policymakers.
Anthropic currently employs about 200 people in the U.K., 60 of them researchers, and last year appointed former prime minister Rishi Sunak as a senior adviser. Last month, competitor OpenAI (OPENAI) committed to expanding in London, making the city its biggest research hub outside the U.S.
The U.S. government and Anthropic have been in a legal tussle since the Trump administration banned the use of the company’s technology after designating it as a supply chain risk.
Anthropic PBC reportedly is also weighing an IPO as soon as October.
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Soleno Therapeutics (SLNO) is up 30% in premarket action.
The deal could value Soleno in the low-to-mid $50s per share, or in excess of $2.5B.
According to the report, discussions between Neurocrine (NBIX) and Soleno (SLNO) are progressing rapidly, and a deal could come together as soon as today.
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Soleno (SLNO) is focused on the development and commercialization of novel therapeutics for the treatment of rare diseases.
Powell Industries (POWL) will begin trading on a split-adjusted basis following the three-for-one stock split.
The HumanX AI Conference in San Francisco will include participation from Amazon Web Services (AMZN), Anthropic, Canva, Conviction, CoreWeave (CRWV), Databricks, DeepLearning.AI, Google (GOOGL), Khosla Ventures, Mercedes-Benz (MBGAF), Microsoft (MSFT), NVIDIA (NVDA), OpenAI (OPENAI), and Perplexity.
UiPath (PATH) will host a live product webinar highlighting its latest agentic business orchestration capabilities, product strategy, and real-world customer outcomes.
Stock index futures are higher as traders remain focused on developments in the Middle East, including the status of the Strait of Hormuz.
President Trump has given Iran until 8 p.m. Eastern time Tuesday to reopen the Strait of Hormuz, warning that failure to comply could trigger U.S. attacks on key infrastructure across the country.
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Axios reported that the U.S., Iran, and regional mediators are negotiating a potential 45-day ceasefire that could pave the way for ending the war.
Bitcoin is up 1.2% at $69,000. Gold is up 0.2% at $4,688.
The markets in China, Hong Kong and Australia closed for a holiday. Markets in London, Germany and France are also closed for a holiday.
The biggest movers for the day premarket: Netflix (NFLX) +2% – Shares rose after Goldman Sachs upgraded the stock to Buy from Neutral and raised its price target to $120, citing improved risk/reward following recent underperformance.
For many SMEs, music is still treated as an afterthought. It gets handed to whoever opens up in the morning, left to a personal playlist, or patched together through a consumer app that was never built for commercial use.
That might seem harmless, but in customer-facing businesses, what people hear shapes how a space feels, how long they stay, and how coherent the brand appears.
For retailers, cafés, hotels, salons, gyms and restaurants, music is not just filler. It is part of the operating environment. It helps set pace, supports atmosphere, and influences whether a space feels polished, chaotic, energetic or forgettable.
Why Music Deserves More Attention From SME Owners
Business owners often spend time refining visual identity, staff training, merchandising and lighting, yet sound is left unmanaged. That creates a gap between how a brand wants to be perceived and how it is actually experienced in person.
A boutique retailer, for example, may invest heavily in store design only to undermine the atmosphere with inconsistent, badly timed, or poorly matched music. A hotel may think carefully about interiors and service standards but fail to create a coherent guest experience from lobby to bar to breakfast area. In both cases, the issue is not simply taste. It is operational inconsistency.
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That is why more operators are starting to view background music for business as a practical commercial decision rather than a casual one. When audio is treated properly, it becomes part of the wider brand experience, alongside layout, service, lighting and customer flow.
The Real Commercial Value Is Consistency
One of the biggest differences between amateur and professional use of music in business is consistency. If each manager chooses their own soundtrack, customer experience starts to drift. One location feels lively, another feels flat, and another sounds like someone’s personal gym playlist.
That inconsistency matters more than many businesses realise. Customers do not always articulate it, but they notice when a place feels off. The music is too loud for conversation, too slow for peak trading hours, too aggressive for the audience, or simply disconnected from the setting.
A better approach is to think in terms of sound standards. What should the business feel like at 8am, at lunchtime, during the evening rush, or in slower periods? What kind of pace supports browsing, dining, waiting, or relaxation? What should remain consistent across every site, and where is there room for local variation? These are practical business questions, not artistic ones.
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For hospitality operators especially, the soundtrack should support the setting rather than compete with it. A more intentional approach to music for hotels can help create a smoother and more coherent guest experience across reception spaces, lounges, bars and shared areas.
It Also Has Operational Benefits Behind the Scenes
There is a staff-side benefit too. In busy environments, poor music choices can create friction just as easily as they can create energy. A soundtrack that clashes with the setting, repeats too often, or changes randomly through the day affects both employee experience and customer perception.
By contrast, a managed system allows businesses to schedule music by daypart, maintain appropriate volume and tone, and avoid leaving the decision entirely to whichever team member has access to the speaker. For multi-site SMEs in particular, centralised control makes a real difference. It reduces guesswork, improves consistency and helps ensure the soundtrack fits both the brand and the trading environment.
Compliance Is Where Many Businesses Still Get Caught Out
This is the part many SMEs underestimate. Playing music in a commercial setting is not the same as listening privately. Businesses need to think about music licensing for business, not just what playlist they want on during trading hours.
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This is where many operators run into problems. A familiar consumer platform may feel convenient, but that does not automatically make it suitable for commercial use. Businesses need to be confident that the way they play music in-store, in reception areas, in dining spaces or in shared environments is properly aligned with licensing requirements.
For SMEs, that means the cheapest-looking option is not always the cheapest in practice. The more sensible question is whether the setup has actually been designed for commercial use, with the right controls and permissions in place.
Smart Operators Think Beyond the Playlist
The strongest customer-facing businesses tend to be deliberate about every layer of the experience. They do not leave lighting, signage or scent entirely to chance, and increasingly they should not do that with audio either.
For small and medium-sized businesses, music does not need to become a major strategy project. But it should be intentional. It should reflect the brand, suit the customer, support the setting, and work consistently across the day. Most importantly, it should be managed like part of the business rather than treated like background noise.
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That shift in mindset is what separates music that quietly strengthens a commercial space from music that simply fills silence.
Wil Williams argues that Wales needs a business support system that is transparent, honest, radical, decisive and bold; everything that it has not been since 2006.
10:56, 06 Apr 2026Updated 10:57, 06 Apr 2026
The WDA was abolished in 2006.
When the Welsh Development Agency was scrapped in 2006, it was presented as modernisation. The language was sound; alignment, accountability and efficiency. However, in reality, the removal of the WDA was driven by ideology and dogma, with outcome far less impressive than the original rhetoric.
The organisation that understood how to build firms and sectors was dismantled and folded into a structure designed to manage risk rather than create value; namely the Welsh Government.
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Nearly twenty years on, the results are hard to ignore. Wales has constructed a business support landscape that is active, visible and permanently engaged in something. What it has not done is consistently help firms to grow. The system looks busy because it is busy. That is not the same as being effective.
The failure of the business support system is not abstract. The absence of medium -sized firms is not an abstract concern; it sits at the heart of Wales’ productivity problem. Too many businesses remain small, under capitalised and structurally fragile. The system that was supposed to support the Mittelstand has, at best, provided guidance. At worst, it has absorbed significant public funding while producing very little in the way of sustained economic transformation.
The contrast with what came before is instructive. The WDA was far from perfect, but it understood something fundamental; economic development is an operational discipline. It is a cultural mindset. It requires judgement, pace and a willingness to act. It had a clear line of sight from policy to delivery, a strong regional presence and the authority to make decisions. It behaved like an organisation expected to produce outcomes, not reports.
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When those functions were absorbed into government, the character of the system changed. Decision making slowed. Authority dispersed. Activity increased, but coherence declined.
Over time, the culture shifted from commercial delivery to programme management. This is not a criticism of individuals; it is simply what happens when an operational function is placed inside a system designed around compliance, procurement and control; in other words, government.
The modern landscape reflects that shift. There is no shortage of provision. Business Wales offers advice. The Development Bank of Wales provides finance. City Deals and local authorities run their own initiatives. UK wide schemes sit alongside them. Innovation bodies, export support and sector programmes all play their part. On paper, it is comprehensive. In practice, it is fragmented.
Firms do not experience this as a system. They experience it as a maze. Multiple entry points. Repeated diagnostics. Different priorities depending on who they happen to speak to. Occasional support, rarely continuity. Plenty of conversation, not enough follow through.
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This is why satisfaction scores, often self-reported, can look respectable while outcomes remain stubbornly weak. Advice is relatively easy to provide and generally well-received. Scaling a business is not. It requires capital, capability, leadership and sustained joined-up engagement over time. That is where the current model struggles.
The deeper issue is cultural rather than structural. The post 2006 environment rewards careful administration. Success is often measured by activity; programmes delivered, funds allocated, targets met. What matters to the economy is different; firms that grow, export, invest and employ. The two are not the same, and the gap between them has widened.
The consequences are visible across the economy. Wales continues to produce fewer medium sized firms than comparable regions. Productivity remains low. That is a function of the paucity of Wales’ Mittelstand. Regional disparities persist, particularly between Cardiff and the rest of the country. There is a growing tendency to accept this as normal, even to dress it up as progress – see the last review Welsh Government Business Support Review, November 2025 – a few tweaks to the system will fix any issues.
The upcoming Senedd Election presents an opportunity, although not a guaranteed one. A new administration will arrive with the usual choice; adjust around the edges or address the problem properly, radically and innovatively. The system will naturally advocate for incremental change. It always does. Incremental change is comfortable. It is also how a failing model is preserved.
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A more serious response would start from first principles. Businesses do not need more programmes. They need a coherent system. One front door, not many. A single relationship that follows the firm as it grows. That relationship must be transparent.
Regional teams with enough authority to act, rather than constantly referring decisions back to Cardiff. Finance that aligns with the realities of scaling, not just early-stage support or asset backed lending. Export, innovation and capability development integrated into a single growth pathway rather than treated as separate activities.
None of this is especially novel. That is precisely the point. These are the basics of economic development; understood decades ago and quietly set aside in favour of something more administratively convenient.
Recreating a delivery focused system, call it WDA 2.0 if you like, would not require reinvention. It though would require: discipline; fewer programmes; clearer missions; harder measures of success; and a willingness to stop doing things that do not work. Most of all, it would require a shift in mindset; from managing activity to driving outcomes.
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That is the uncomfortable part. Structural reform is relatively straightforward. Cultural change is not. It demands political will and a tolerance for decisions that may not please everyone, particularly those invested in the current arrangements.
If the next administration chooses caution, the system will continue as it is; busy, well-intentioned and fundamentally ineffective. If it chooses to act, it will need to do so with clarity and conviction.
At first glance, there appears to be some tension in this argument. On the one hand, there is a clear case for stronger regional and local delivery, including through bodies such as CJCs (corporate joint committees that includes the Cardiff Capital Region). That is essential. But it must sit within a disciplined national framework; one that is relentlessly focused on what actually matters; business creation, survival and growth.
The same applies to consistency. The system does need greater coherence and stability in how support is offered. However, that does not mean rigidity. A practical shift is required; one that allows for structured experimentation (innovation within a 100% commercial framework) in the design and delivery of economic support programmes. This means learning from what has worked elsewhere; testing different approaches in live economic conditions; and reporting outcomes honestly and in real time, including where things fail.
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That approach demands a different type of organisation. One with the imagination and confidence to act; open to new ideas; prepared to challenge its own assumptions; and grounded in commercial reality rather than administrative comfort. In that context, experimentation is not a contradiction of consistency; it is the mechanism through which genuinely consistent and effective programmes are built over time.
The name of the organisation matters less than its function, although I believe there remains value in the WDA brand some twenty years on. A single entity should be established as an operational agency; separate from government, but clearly accountable to it. It must hold authority over the principal levers of economic value creation; including Business Wales, the Development Bank of Wales the £547m Local Growth Fund for Wales, strategic land and property assets, and export and inward investment functions.
At the same time, it must remain connected to place; transparent and accountable to the Senedd; working in close alignment with local authorities, through the CJCs, a regional tier of sufficient scale to act strategically while remaining grounded in local economic realities.
Let us hope that a new administration does not default to what the system will inevitably recommend; incremental change, the status quo. The new business support system must be transparent, honest, radical, decisive and bold; everything that it has not been since 2006.
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Wil Williams is co-founder of LearnerMetrics and a former chief executive of the Alacrity Foundation.
Financial analyst by day and a seasoned investor by passion, I’ve been involved in the world of investing for over 15 years and honed my skills in analyzing lucrative opportunities within the market.I specialize in uncovering high quality dividend stocks and other assets that offer potential for long term-growth that pack a serious punch for bill-paying potential. I use myself as an example that with a solid base of classic dividend growth stocks, sprinkling in some Business Development Companies, REITs, and Closed End Funds can be a highly efficient way to boost your investment income while still capturing a total return that follows traditional index funds. I created a hybrid system between growth and income and manage to still capture a total return that is on par with the S&P.
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Major airlines around the world have begun canceling thousands of flights and raising fares as jet fuel prices have more than doubled and physical supplies have tightened in the wake of the ongoing war in Iran and the effective closure of the Strait of Hormuz.
United Airlines became the first major U.S. carrier to announce capacity cuts, trimming about 5% of planned flights on less profitable routes. International carriers have moved more aggressively, with Scandinavian Airlines canceling around 1,000 flights in April, Air New Zealand axing 1,100 services through early May, and carriers in Vietnam and elsewhere suspending domestic routes due to fuel constraints.
The disruptions stem from the conflict that escalated in late February when U.S. and Israeli strikes targeted Iran, prompting Iranian retaliation that effectively halted most commercial shipping through the Strait of Hormuz. The narrow waterway, which normally carries about one-fifth of global seaborne oil trade, has seen traffic reduced to a trickle amid attacks on vessels, soaring insurance costs and safety fears.
Jet fuel prices, which averaged around $2.17 per gallon in the United States before the escalation, surged past $4.57 per gallon by late March, according to the Argus U.S. Jet Fuel Index. In some Asian and European markets, prices have doubled or more, reaching record levels near $200 per barrel or higher in spot trading. The crack spread — the premium for refining jet fuel from crude — has exploded, reflecting acute shortages of the refined product rather than just higher crude costs.
“Jet fuel prices have more than doubled in the last three weeks,” United CEO Scott Kirby said in a recent statement. “If prices stayed at this level, it would mean an extra $11 billion in annual expense just for jet fuel.” Kirby noted the carrier is “tactically pruning flying that’s temporarily unprofitable” while warning of broader impacts if the situation persists.
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Ryanair CEO Michael O’Leary warned that if the Hormuz disruption continues into May and beyond, European airlines could face shortages of 10% to 20% of normal fuel supply by June, potentially forcing cancellation of 5% to 10% of summer flights. He said cuts would target the most constrained airports with little advance notice from suppliers.
The crisis has hit regions differently. Middle Eastern carriers such as Emirates, Qatar Airways and Etihad have canceled tens of thousands of flights due to airspace closures and safety concerns in addition to fuel issues. Asian airlines, heavily reliant on Middle Eastern crude refined in South Korea, China and elsewhere, have faced export restrictions and local shortages. Vietnam Airlines has suspended multiple domestic routes, while Korean Air has entered “emergency management mode.”
In Europe, the last major jet fuel shipments from the Middle East to the U.K. were expected to arrive this week, leaving airlines with limited reserves. Some Italian airports have already imposed refueling restrictions for certain operators. Lufthansa has prepared contingency plans that could include grounding portions of its fleet.
U.S. carriers benefit from greater domestic refining capacity and have so far relied more on fare increases and baggage fee hikes than widespread cancellations. JetBlue and others have raised checked baggage fees, while carriers across the board have introduced or increased fuel surcharges on international routes. Air France-KLM added €50 ($58) to long-haul tickets, and several Asian carriers have followed suit.
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Aviation analytics firm Cirium reported that on one recent Monday, more than 7,000 flights — nearly 7% of the global schedule — were canceled, far above typical rates. North American departures saw cancellation rates spike to 14.6% on that day.
The International Air Transport Association had forecast a record $41 billion in net profits for the global airline industry in 2026 before the conflict. That outlook is now at serious risk as higher fuel costs coincide with potential weakening in travel demand from elevated gasoline prices and broader economic uncertainty.
Analysts describe the situation as a “perfect storm.” Longer reroutes to avoid Middle Eastern airspace burn extra fuel, compounding costs. Refineries in Asia have cut jet fuel production due to feedstock shortages, while strategic reserves are being drawn down in some countries.
Travelers are already feeling the pinch. Airfares on many routes have risen sharply, with some long-haul examples nearly tripling in price in extreme cases. Industry experts advise passengers to monitor bookings closely, consider flexible tickets and expect potential disruptions through the summer if the conflict drags on.
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The war has also disrupted related supply chains. Cargo operators face higher costs and delays, while the broader energy shock has lifted diesel and gasoline prices, adding pressure on household budgets and potentially curbing discretionary travel.
Governments are responding variably. Some Asian nations have redirected fuel stocks domestically or sought emergency assistance. In the U.S., domestic production provides a buffer, but analysts warn that prolonged global tightness could still affect American carriers through higher prices and knock-on effects on international partners.
Billionaire aviation figures have sounded alarms. One Dubai-based jet tycoon warned that if the crisis lasts more than a month, the first airline bankruptcies could emerge as weaker carriers struggle with unsustainable costs.
The situation remains fluid. Diplomatic efforts continue, with some reports of signals from involved parties about willingness to de-escalate, but the Strait of Hormuz remains largely closed to routine tanker traffic. Any resolution could ease pressures quickly, as shipping resumes and refineries ramp up, but a prolonged standoff risks deeper economic pain.
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For now, airlines are prioritizing cash preservation. Many have shifted to shorter-haul or more fuel-efficient operations where possible and are reviewing summer schedules. Low-cost carriers, with thinner margins, face particular strain despite hedging strategies that have partially mitigated the spike for some.
Passengers planning travel are urged to check airline updates frequently, as last-minute cancellations tied to fuel availability at specific airports could occur with minimal notice. Travel insurance that covers trip interruptions is recommended.
The crisis highlights the vulnerability of global aviation to energy chokepoints. Jet fuel, derived from kerosene, requires specific refining processes, and there is limited spare capacity worldwide to quickly replace lost volumes from the Gulf.
As April unfolds, more carriers are expected to announce adjustments. United’s early move may foreshadow broader U.S. capacity reductions if prices remain elevated. Delta has indicated it could trim schedules, while others watch inventory levels closely.
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The human impact extends beyond higher ticket prices. Flight crews face schedule changes, airports deal with irregular operations, and tourism-dependent economies — from Europe to Southeast Asia and Australia — brace for reduced visitor numbers.
Environmental goals may also take a backseat temporarily, as airlines prioritize operational survival over sustainability initiatives that rely on costly sustainable aviation fuel.
Industry groups like IATA have called for strengthened jet fuel resilience, including dedicated reserves and diversified sourcing. The current events underscore how concentrated supply routes create systemic risks.
With no immediate end to the conflict in sight, the aviation sector faces one of its most challenging periods in years. What began as a geopolitical confrontation has rapidly translated into higher costs and fewer flights for travelers worldwide, serving as a stark reminder of interconnected global energy markets.
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