The place to start up your start-up
2018-11-26 | By Molly Quell
TomTom and Booking.com are just two household names originating on the Dutch start-up scene. There’s around 800 start-ups in the Netherlands and, according to StartupRanking, a website which tracks worldwide data about start-ups, the country ranks 12th in the world for the number of start-ups. Per capita, it jumps ahead of other European Union countries including Germany and France, boasting one start-up per 25,000 inhabitants.
Ask three business and entrepreneurship experts what a start-up is and you’re likely to get four answers. The traditional definition was put forth by Steve Blank, sometimes referred to as the father of the start-up, as “an organisation formed to search for a repeatable and scalable business model.” Start-ups differ from many traditional small businesses in that they are, from the outset, seeking large-scale growth and offer a product that can meet that goal.
If you make delicious cakes and you start a bakery, you’re not a start-up. There’s only one of you and you can only bake so many cakes per day. Even if your bakery grows or your aim is to hire many more bakers, it still wouldn’t meet the definition of a start-up. However, if you invent a machine which bakes better cakes and you can sell those machines to bakeries around the world, you might have yourself a start-up.
Europe’s Silicon Valley
According to Startup Nation Scoreboard, the Netherlands ranks number one in Europe for its start-up business climate, based on criteria including infrastructure, the level of English spoken and the educational level of the country’s workforce, among other criteria. “It’s more than just the practicalities,” according to Oscar Kneppers, founder of Rockstart, a start-up accelerator headquartered in Amsterdam. “The Dutch are trade-driven, optimistic and outward looking,” he says. These are important qualities if you want to start your own company.
Dutch-based start-ups raised €442 million in investment during 2017, according to StartupDelta. The largest investment was in the grocery delivery service Picnic, a food delivery start-up, which raised €100,000,000.
Amsterdam versus Delft
Unsurprisingly, most of the country’s start-ups are located in Amsterdam, where most of the country’s venture capital investors are also located. TU Delft (Delft University of Technology), however, has created the most spin-off companies of any university in the country. Delft is home to one of Europe’s largest start-up incubators, Yes!Delft, which was started 12 years ago by the Delft gemeente (municipality), TU Delft and private partners. “Each city has its own flavour,” says Tom de Heus, project lead at the Impact StartupFest. That event, which takes place in The Hague, sees more start-ups with altruistic goals. “The Hague is the city of peace and justice, so we see more NGOs,” he says. The Red Cross and War Child, among others, will attend the event on 2 October.
All start-ups, however, aren’t located in the Randstad (the area in and around Amsterdam, The Hague, Rotterdam and Utrecht). Accelerator Rockstart has locations in both ’s-Hertogenbosch and Nijmegen, as well as Bogota, Colombia. “In Nijmegen, we see a lot of medical and health-related start-ups,” says Kneppers. In fact, Nijmegen is an area traditionally associated with the health and medical industry. Radboud University is located there, which includes the Radboud University Nijmegen Medical Centre and collaboration on medical technology with the University of Twente and the Technical University of Eindhoven, which make up the Red MedTech Highway.
Incubators, accelerators and more
It isn’t only universities which are nurturing start-ups, though many fund the various incubators and accelerators which serve as launching points for the companies just getting off the ground. The specifics vary widely, but generally, an incubator helps to get a company started while an accelerator helps companies to grow. Amsterdam-based Rockstart describes itself as an accelerator “with the goal to provide start-ups with access to the market, capital, knowledge, and community.” Yes!Delft calls itself an incubator that “brings your product to the market as fast as possible.” Co-working space can even be considered part of the start-up ecosystem, as young companies often use them to network, expand and get support.
Title aside, these organisations exist to help companies get started and grow. They often offer classes and mentorships with business experts, free or reduced-priced services with in-house advisors on subjects like taxes and law, and connect companies with investors. Many offer working spaces for companies and equipment, such as 3D printers and labs. They further allow those companies to meet one another, share knowledge and network.
Small organisations get involved, too. AeroDelft is a student-run start- up incubator based in Delft, which focuses on student projects from the university. Founded in 2017 by Liam Megill and Thomas Hunter, both
bachelor’s students in aerospace engineering, AeroDelft already has two projects: Talaria, a competitor in Boeing’s GoFly competition creating a personal flying device; and Phoenix, which aims to build a hydrogen-powered touring motor glider (see image, right). “We really wanted to do something that was by students, for students,” says Megill.
The Dutch government sees the value in start-ups. The national government tapped former European Union Commissioner Neelie Kroes to attract more start-up companies to the Netherlands. That initiative, known as StartupDelta, is a public-private partnership supported by three government ministries (Economic Affairs, Foreign Affairs and Education, Culture and Science), a number of regional and city initiatives, and various private companies including Booking.com, energy company Eneco and Rabobank.
One of StartupDelta’s accomplishments has been the start-up visa. Beginning in 2015, anyone who wished to move to the Netherlands from outside of the EU and start a company could apply for the “start-up visa”, which offers a one-year visa to entrepreneurs who are supported by a facilitator, such as an incubator or accelerator. According to the Ministry of Immigration, “This is good for the entrepreneur, but also good for employment and the economy.”
On a local level, various regions and cities offer support for start-ups. Regional acquisition agencies, like the Innovation Quarter, a regional partner of the Netherlands Foreign Investment Agency, offer companies a “soft landing” in their respective regions. Others, such as Founded in Groningen, provide online resources about starting companies and interacting with other entrepreneurs. Founded in Groningen runs the Startup in Residence programme, a five-month intensive training programme for new founders. Many of these initiatives are funded by the regional and local governments, together with local businesses and universities.
Start-ups in the Netherlands come both from Dutch nationals but also internationals from all over the world. According to StartupDelta, 6% of international students in the Netherlands start a company in the country after they graduate, and the creation of the start-up visa has increased the diversity of start-up founders in the country. “At Rockstart, it’s mostly not Dutch actually,” says Kneppers. Given that start-ups are heavily based in the technology sector, it’s not surprising that English is the preferred language and products are marketed globally.
A different outlook
Unemployment in the Netherlands is low, the economy is growing, and in many sectors there is a shortage of highly-skilled workers. Considering that many of these start-up founders could have more traditional employment, why choose to go their own way? One reason is passion. “At the Impact StartupFest, we see a lot of people with really crazy ideas that no one else has come up with,” says De Heus.
That’s how Gijsbert van Marrewijk started Berthan Engineering Consultants with Johan Schonebaum. The two were on the TU Delft Solar Boat Team. (See photos pages 12-13.) The team participates in various solar boat competitions, but Van Marrewijk and Schonebaum saw a more practical application: water taxis. Their start-up is working on developing sustainable boats which could be used in cities like Rotterdam.
Others enjoy the challenges and working environment of start-ups. “We usually take a break… some ping- pong,” says Max Lammers of Sense Glove, a company developing a glove used to simulate touch in virtual reality. The company is located at Yes!Delft, which among its other offerings as a start-up incubator, offers companies office space complete with a com- munal ping-pong table. It’s more than just fun and games though. Sense Glove is looking to see if its tech- nology could also be used as a medical device, which requires extensive testing in the EU. Another company at Yes!Delft is currently going through the process and, after learning that Sense Glove was considering it, offered to share what they had learned. The companies learned off of each other around the ping-pong table.
The stereotype of start-up founders being young, male and in the tech industry isn’t inaccurate. Globally, start-ups tended to skew towards younger, in both the age of their founders and their employees. Data from Namely, a global HR company, found that around half of the employees at start-ups are under 30. Nearly 30% of start-up companies are in the technology sector. And nearly three-quarters of employees are male. Further, only 17% of start-ups have female founders. Women in the industry certainly face an uphill battle.
According to Kneppers, start-ups can be more agile than R&D departments at larger companies while StartUp Delta points to the economic benefits of having new companies in communities. Picnic now employs 2,000 people. It also delivers groceries cheaper than large supermarkets like Albert Heijn and has a higher customer satisfaction level. It’s this sort of success story that excites local governments. According to De Heus, this is also precisely why NGOs join the Impact Startup Fest. “Non-profits have less money available for new, risky ventures so it is often better for them to partner with a start-up,” he says.
About the author
Molly Quell is a writer and journalist living in the Netherlands. She is a contributing editor to DutchNews.nl , where you can find her analysing Dutch politics and writing about beer and animals (together, if possible). Follow her on Twitter @mollyquell