Sweden has a highly innovative national innovation system despite its small size. It consistently ranks highly in measures of innovation capacity and competitiveness. Key aspects of Sweden's innovation system include strong performance in university and private sector research and development. It also benefits from ties to global companies and exports that account for about half of its GDP. While large multinational firms play an important role, challenges include a slow growth of small- and medium-sized enterprises and potential over-reliance on a few large companies. The agency VINNOVA works to strengthen Sweden's innovation capacity through funding research collaborations both domestically and internationally.