The Netherlands: Europe's Unsung Innovator in the Tech Ecosystem
Netherlands: Topping the rankings
The Netherlands has been ranked as the sixth happiest country in the world in 2024, a slight drop from its fifth place position last year. Consecutively, according to IamExpat Report, four Dutch cities made it into the top 10 livable cities (including Eindhoven, Rotterdam, The Hague and Amsterdam). There's no doubt that the country's high-quality lifestyle makes it an attractive destination for entrepreneurs and tech companies to set up their European headquarters.
But there's more to it. With a strong economy characterised by stability and growth, the country offers ample job opportunities across various sectors, including technology and finance. Its excellent public transportation and a cycling culture, make it easy to travel within cities and to other parts of Europe. The multicultural society enriches the culture with an open-minded and inclusive atmosphere. Dutch value work-life balance, reflected in reasonable working hours and generous vacation policies, allowing residents to enjoy leisure time and family life.
The country ranked number one in the English language adoption with approximately 90% of the population speaking English to some degree, with about 71% of people being fluent (EF English Proficiency Index 2023). English is widely taught in schools from a young age, and the country's strong cultural exposure to English through media and business further enhances proficiency.
Rich history of innovations
The Netherlands has a rich history of innovation and has produced several remarkable inventions that have had a significant impact globally. Here are some of the best inventions attributed to the Netherlands:
- The Windmill: Iconic to Dutch culture, windmills were crucial for pumping water and grinding grain, showcasing innovative engineering in managing the country’s waterlogged landscape.
- The Microscope: Antonie van Leeuwenhoek, a Dutch scientist, is credited with inventing the first practical microscope in the 17th century, paving the way for modern microbiology.
- The Telescope: While often attributed to others, the earliest known telescopes were developed in the Netherlands by Hans Lippershey, which revolutionised astronomy.
- The Bluetooth Technology: The foundation for Bluetooth technology was developed by Dutch engineer Jaap Haartsen in the 1990s, transforming wireless communication.
- The Artificial Heart Valve: The first successful artificial heart valve was developed by Dutch surgeon Willem Kolff, contributing to advancements in cardiac surgery.
- The Heineken Beer Brewing Process: The brewing techniques developed by Heineken have influenced beer production worldwide, making it one of the most recognised brands.
- Self-Driving Car Innovations: Dutch companies and researchers are at the forefront of developing technologies for autonomous vehicles, contributing to the future of transportation.
The Netherlands is often overshadowed by its larger European neighbours, yet these inventions reflect that the Dutch spirit is full of creativity and innovation among various fields.
Great place for tech businesses
The Netherlands is ranked fourth in Europe for start-up value creation, with Amsterdam emerging as one of the continent's fastest-growing start-up hubs. Here’s a closer look at the key reasons why the Netherlands stands out as an ideal place for tech companies.
Central location
Situated at the heart of Europe, the Netherlands offers easy access to major European markets. Amsterdam, Rotterdam, and The Hague serve as major logistical hubs, with world-class transportation networks, including Schiphol Airport, one of Europe’s busiest airports. This strategic positioning enables tech businesses to connect with clients and partners across the continent.
Supportive government policies
The Dutch government actively supports innovation and entrepreneurship through various initiatives. Tax incentives, grants, and funding programs are available for startups and scale-ups, particularly in tech sectors like AI, blockchain, and sustainable energy. The Innovation Box regime allows qualifying companies to benefit from significantly reduced tax rates on profits derived from innovative activities.
As of 2023, the corporate tax rates in the Netherlands are structured as follows:
- For taxable profits up to €175,000: 19%
- For taxable profits above €175,000: 25.8%
These rates apply to standard corporate income tax. Additionally, the Netherlands has an Innovation Box regime, which allows qualifying profits from innovative activities to be taxed at a significantly reduced rate of 9%.
Disclaimer: It's always a good idea to consult with a tax advisor or check for any updates from the Dutch tax authorities, as tax regulations can change.
Great startup ecosystem
The Netherlands has a dynamic startup ecosystem, particularly in cities like Amsterdam, Utrecht, and Eindhoven. With numerous incubators, accelerators, and co-working spaces, entrepreneurs find ample opportunities to network, collaborate, and access resources. Notable tech hubs like StartupAmsterdam and the Amsterdam Science Park promote innovation and connect with investors, mentors, and industry experts. Networking is important in the tech industry, and the Netherlands provides ample opportunities to connect with like-minded individuals. Numerous tech meetups, conferences, and workshops are held regularly, for example: Amsterdam Tech Week and the Dutch Tech Festival are just a few of events that attract industry leaders, investors, and innovators.
Diversity and talent pool
The Netherlands is known for its multicultural society and inclusive workforce. The country attracts talent from around the globe, providing tech businesses with access to a diverse pool of skills and expertise. The presence of top universities and research institutions, such as Delft University of Technology and Eindhoven University of Technology, ensures a steady supply of highly educated graduates in STEM fields.
Sustainability and green tech focus
With a strong commitment to sustainability, the Netherlands is at the forefront of the green technology movement. The government encourages companies to adopt sustainable practices, and many tech startups focus on solutions that address climate change and environmental challenges. This emphasis on sustainability not only attracts socially conscious investors but also aligns with the values of today’s consumers.
Access to funding
The Dutch tech ecosystem has access to various funding options, from venture capital firms and angel investors to government grants and crowdfunding platforms. The presence of numerous investment networks and events, such as the Amsterdam Capital Week provides startups with the opportunity to pitch their ideas and secure funding for growth.
Main tech hubs
The Netherlands is home to several vibrant tech hubs that are driving growth and attracting investment. Amsterdam, the country's capital, is a major centre for fintech, e-commerce, and digital media. Eindhoven, known for its strong ties to the semiconductor industry, is a hub for high-tech manufacturing and research. Other tech hubs include Utrecht, Rotterdam, and Delft.
Dutch tech companies
The Netherlands has produced a number of successful tech companies that have made a significant impact on the global stage. As of 2023, here are ten notable unicorns from the Netherlands, which are private companies valued at over $1 billion:
1. Adyen: A global payment company that provides businesses with a platform to accept payments across various channels.
2. Booking.com: A leading online travel agency specializing in accommodation bookings, part of the Booking Holdings group.
3. Just Eat Takeaway: A major player in the online food delivery market, connecting consumers with local restaurants.
4. MessageBird: A cloud communications platform that enables businesses to communicate with customers across various messaging channels.
5. Framer: A collaborative design tool that allows teams to create responsive websites and prototypes easily.
6. Picnic: An online grocery delivery service known for its innovative approach to logistics and customer service.
7. Trade Republic: A mobile brokerage platform that allows users to trade stocks and ETFs with no commission.
8. VanMoof: A smart bike manufacturer focusing on urban mobility with high-tech features and sustainable design.
9. Catawiki: An online auction platform for buying and selling special items, from art to collectibles.
10. Mambu: A cloud banking platform that provides financial institutions with software solutions to launch new banking products quickly.
Key Organisations to get you started
Netherlands Point of Entry
The Netherlands Point of Entry is the primary gateway for international individuals aiming to work or launch a business in the Netherlands. It offers tailored support and fosters connections to ease the transition process.
Diverse Leaders in Tech
Diverse Leaders in Tech, powered by Techleap, is a community-driven initiative that champions diversity, equity, and inclusion (DEI) within the Dutch tech sector. It provides resources like benchmarks, educational tools, consulting services, and events, including the DEI in Tech Summit.
Invest-NL
Invest-NL is an independent organisation dedicated to tackling financing challenges in significant social transitions. It assists companies facing uncertainties, high transaction costs, and limited access to capital, with a particular focus on young and rapidly growing businesses.
Incubators United
Incubators United is a collaborative network of Dutch universities and public incubators linked to research institutions. Its mission is to support Deep Tech startups and enhance the application of scientific knowledge.
ScaleNL
ScaleNL is a public-private initiative designed to help Dutch tech startups expand into the U.S. With the support of the Dutch Consulate General in San Francisco and The Startup Liaison Network, ScaleNL provides a comprehensive resource toolbox, flagship programs, and access to funding.
ROM Nederland
ROM Nederland, or Regional Development Agencies (RDAs), stimulates innovation, investment, and internationalisation in the regional economies of the Netherlands. They promote innovation by fostering partnerships and investing in startups and SMEs through loans and equity.
The Future of Dutch Tech
The Netherlands is well-positioned to continue its growth as a global tech leader. With a strong foundation of innovation, a talented workforce, the country has all the ingredients for long-term success. However, it is not without its significant challenges. The country faces several problems despite its many strengths. One significant issue is the housing shortage, particularly in major cities like Amsterdam and Utrecht, where demand for affordable housing often exceeds supply.
Additionally, as a low-lying country, the Netherlands is particularly vulnerable to climate change, with rising sea levels and extreme weather events necessitating ongoing investments in flood protection systems. An ageing population presents additional challenges for the healthcare system and labour market, increasing the demand for services and raising concerns about workforce sustainability. Finally, biodiversity loss driven by urbanisation, agricultural practices, and climate change underscores the need for sustainable practices to protect natural habitats. Addressing these challenges will require strategic efforts from the government.
Summary
The Netherlands stands out as a vibrant hub of innovation and opportunity within the European tech ecosystem. Its high quality of life, strong economy, and supportive government policies create an ideal environment for tech companies and startups. While challenges such as housing shortages, climate vulnerability, and an ageing population must be addressed, the Netherlands is well-equipped to navigate these issues.
As it continues to build a thriving tech scene, the Netherlands is poised to solidify its reputation as a key player on the European and global stages, making it a compelling destination for those looking to invest in the future of technology. If you’re a tech company looking to grow tech partnerships in the Netherlands, make sure you have the right technology in place to get you started. Journeybee offers a Partner Relationship Management (PRM) that can help collaborate, co-sell and grow your tech company in the Netherlands.
