Show a 1980s Swedish banker a list of the companies which have raised equity capital on the Stockholm Stock Exchange over the past year and he would not believe his eyes. There are computer game designers, fitness centres and dental care operators, but barely one manufacturing company. Show him the valuations and he might have a heart attack. Start-up firms with no proven revenue streams have raised Skr200 million ($25 million) on P/E ratios of 40 and higher. The shares in one recent IPO, Prosolvia, a virtual-reality software designer, rose by more than 170% during 1997 and are now trading at 63 times estimated 1997 earnings. The existence of companies like Prosolvia (and their ability to raise such large amounts of capital) says much about the way in which Sweden has changed over the past five years. Gone are the days when the only companies were huge industrial groups in mature manufacturing industries. Today Sweden is buzzing with start-up companies in fields such as genetic research and Internet technology. "In the past there were very few new companies in Sweden," says Ulf Lowenhav, director of Aragon, a local broker. "But that has all changed. People are coming up with new ideas and there are a lot of entrepreneurs around who are willing to challenge the establishment."