The startup scene in the Netherlands is booming, but there is more to do
The European startup scene is booming, with total equity value more than $3 trillion in 2021 – the highest number ever recorded.
Currently, four countries are the main players in the ecosystem: the UK, the Netherlands, Germany and France, which are hosting almost two-thirds of the continent’s top 1,000 startups and scale-ups.
Among them, Amsterdam has experienced explosive growth, with as many as 53% average year-over-year growth since 2011. It is also ranked as that of Europe second best performing startup hub for 2021 — preceded by London and followed by Paris and Berlin.
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Yet, compared to other countries, the Netherlands is less competitive when it comes to attracting foreign talent and business ideas from outside Europe.
Many European governments have launched startup visa programs to attract the best and brightest talent to their respective countries. In return, they provide an alternative path to immigration for non-European citizens.
The Netherlands introduced a start-up visa scheme in 2015 that provides a residence permit to people outside the EU who want to start a business.
Among the criteria to be met, entrepreneurs must demonstrate that their product or service is innovative, that they have a clear business plan, the support of an approved accompanistand sufficient means to live in the Netherlands.
Interested founders have one year to create an innovative product or service in the country.
However, the one-year limit is not only restrictive for a company’s development, but also demotivating for an entrepreneur who is considering moving his life to another country.
After the visa expires, founders of foreign startups have the option to apply for the visa residence permit for a self-employed person – which is valid for a maximum of five years – and then have the option to apply for Dutch citizenship.
The UK, France and Germany, which require similar eligibility criteria, offer more attractive options by comparison.
The UK doesn’t just offer a two-year period starter visabut also enables entrepreneurs with a successful startup to move to the three-year Innovator Visawhich can be extended indefinitely.
France is even friendlier with it Technical visasince it not only lasts four years and is renewable, but also allows the founder’s spouse and dependent children to be included in the compassionate family status.
In Germany, startup founders from outside the EU fall under the visa/residence permit for self-employed persons scheme. If the business idea is successful and an entrepreneur is able to earn a living for himself and his family, the initial three-year residence permit can be converted into a business permitallowing them to live in the country indefinitely.
But hopefully the Netherlands will soon also offer more inclusive opportunities.
Last week, State Secretary Eric van der Burg of Justice and Security wrote to the House of Representatives that foreign startups that come to our country are given not one, but two years to set up their company. fd reports.
The accompanying report that prompted the re-evaluation of the visa found that the scheme has achieved its goal of attracting innovative startups to the Netherlands, with 649 visas granted since 2015.
But that is still overshadowed by the UK’s 364 grants given in the period between September 2021 and September 2022 only.
The benefits of attracting foreign startups are many. They make a sustainable contribution to economic growth, support local employment and strengthen a country’s competitive position both within Europe and on the world stage.
So if the Netherlands wants to improve its startup hub ecosystem and provide a more attractive argument for non-EU founders, it will have to offer a wider range of incentives, starting with the two-year visa duration. There are many benefits to start-ups in the country, but if it is ever to overthrow other start-up hubs, the Netherlands must do more than match them.
