And of course, in large part because this is effectively a bilingual country. In the years I've been here, I've only talked with a handful of native-born Swedes who did not speak English. Those were older people who had learned German as a student. (There are non-native-born Swedes, like immigrants from Chile who speak fluent Spanish and Swedish, whose English can be poor.)
So yes, it would be easy.
On the first evening I had a bit of difficulty operating the keycard outside the hotel. A chap came up to me and started talking, presumably explaining how to use it. "Murgle burgle burgle wurgle furgle", he said, or something like that. I must have looked blank for about 0.1 seconds before he slipped, with barely a beat, into flawless, unaccented English. And the first English words out of his mouth were, "Oh, sorry..." :)
(This was not a unique experience. Even the petrol station attendants spoke great English. You don't even get that in England.)
No startup scene, but a 1,300 sq. ft. apartment in the center of town (3bd, 1.5 ba) goes for only $1,500/month, and the commuter train to Gothenburg takes about 45 minutes.
If you have money you can get a "business apartment" for about 2x the normal rate. Those are pretty easy to find. But you'll need to have a business first (even one in the US) to rent it.
You can get an idea of what's available using the aggregator http://kvalster.se/Stockholm . When a place is "1 rum" it means studio, "2 rum" means "living room and bedroom", etc. As a decent approximation, 1sq meter is 10 sq. feet.
Rates in the tech area of Kista look about $700 for a shared room/studio. In Södermalm I see prices more around $800 for a room/studio, though you can pay a lot more. (350 sq. ft studio apartment, furnished, for one month rental while the owner is overseas, $1264 for the month.)
It is possible to get a sublet or such but it tends to be expensive and quite time consuming. A lot of scams going around as well so one has to be careful. Prices indicated above seem quite accurate.
But when I first moved to Gbg it was easy to get a 2nd-hand contract. Now it's nearly impossible. I read that there was a change ~5 years ago in the law to make it financially better for the Bfr to switch from rental to co-op, so I can see how that would also affect Stockholm.
Well, if I want my children to retire in Vasastan then I should put their name on the list soon. (And have children, but that ruins the joke.)
Some current listings from the Swedish equivalent of Craigslist:
If you don't mind (or prefer) living in the suburbs you can definitely reduce your costs a lot.
There are some major caveats: Income taxes are extremely high and tax rules makes it almost impossible to share ownership in a rational way, e.g. it is very hard to setup stock option programs etc. Also, the domestic venture capital market is extremely underdeveloped - a great opportunity for foreign investors!
I am a firm opponent of all government programs to stimulate entrepreneurship. My view is that the government should simply get out of the way. And in fact, except for the taxes, this is by and large what the Swedish government is doing. For example, there is very little bureaucracy around running a business, e.g. starting an incorporated company is now done easily over the internet, often the whole process can be completed in a matter of days.