The Dutch tech startup ecosystem has grown steadily over the past five years and has established itself as one of the most dynamic hubs in Europe. However, there are still hurdles that the Netherlands must overcome in order to reach its full potential and thrive in global competition.
That emerges from the annual State of Dutch Tech report by TechLeap, a non-profit organization that helps to quantify and accelerate the ecosystem in the Netherlands.
Here are seven key takeaways from the report to know:
The Netherlands is home to the most successful ecosystem in the EU
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The heart of technology comes to the heart of the Mediterranean
In 2022, the Amsterdam Delta region was the leading ecosystem in the EU, overtaking Paris and Berlin. Globally, it ranks fourteenth behind cities in the US, Asia and the UK.
However, the combined valuations of Dutch startups also stagnated
The country’s technology sector fell from fourth to sixth position globally with a total public market capitalization of €0.4 trillion. The Netherlands still leads the EU thanks to tech giants ASML, Prosus and Adyen.
Fintech and healthcare were the country’s dominant startup sectors, with the early sectors also spawning the most scale-ups. The Netherlands also welcomed a new unicorn in 2022, bringing the total to 1.4 unicorns per million inhabitants. This puts it above France (0.7) and Germany (0.5), but below Sweden (2.4) and the UK (1.7).
The tech sector is also growing outside of the Amsterdam Delta
Although the North Holland region remains the largest startup hub in the country, generating 38% of startup jobs, other local hubs are also growing thanks to regional specializations and mutual collaboration.
For example, North Brabant saw 27% annual growth in deeptech jobs, Utrecht increased the number of startups by 900 and Gelderland has become a leader in foodtech.
Job creation is increasing, but attracting talent remains a challenge
In 2022, jobs created by startups reached 135,000, up from 109,000 in 2020 and 130,000 in 2021. However, attracting tech talent presents a challenge for many startups.
In particular, the proportion of hard-to-fill tech jobs has risen to 59%. On average, these vacancies remain open for more than 60 days.
This phenomenon also occurred in other ecosystems, including Sweden, Germany, France, and the United States.
Dutch startups are struggling with scaling mainly due to a lack of funding
The startup-to-scaleup ratio is lower in the Netherlands (22%) than in other European hubs such as Germany (37%), the UK (30%) and France (26%). This is mainly due to insufficient capital.
In 2022, the total VC funding in the Netherlands amounted to 2.6 billion euros, with the average funding being 0.26 million euros per startup. This was significantly lower than other large startup ecosystems in the EU. For comparison: Sweden’s average was 0.9 million euros per startup.
Despite the Netherlands’ prowess in scientific and academic research, deeptech, at EUR 0.7 billion, is one of the
On the bright side, investments in impact startups are growing at over €1 billion in 2022. And investment across all sectors exceeded pre-pandemic levels.
The gender gap
The gender gap continues to be a problematic issue within the industry. Only 10% of Dutch tech startups are led by women and funding for female entrepreneurs is similarly inadequate. Just 0.7% of venture capital investment – since 2019 – has been raised by companies with female founding teams, lagging behind the UK (2%), Germany (1.5%) and France (1.2%).
The potential for further growth
According to the report, the Dutch tech ecosystem has huge growth potential. In particular, 250,000 jobs and 400 billion euros in value could be created by 2030. This could be accomplished by supporting the growth and impact of university spin-offs, bridging the talent and diversity gap, and cultivating a more resilient and internationally embedded VC market.