Start-up organization says the government should become clients of up-and-coming firms

Techleap, the Dutch organization providing assistance and advocacy for start-ups, says that the government should help new technological companies not only with subsidies, but by also becoming their clients. This was stated in a report about the state of the Dutch tech sector released earlier this week. Young innovative companies can grow more easily if they have the government as a client, said the interest group. The Netherlands is lagging behind in this regard, the organization said.

Techleap drew a comparison with Germany. Of all start-ups that received their first 100,000 to 10 million euros in venture capital investments in that country, 32 percent managed to grow into a scale-up with more than 10 million euros in capital raised. In the Netherlands, 19 percent of start-ups succeeded. This meant that the scale-up share was also lower than in France and the United Kingdom, according to Techleap's annual report on the tech sector.

The government can change this by paying for services from start-ups. The Netherlands would mainly have to focus on deep tech, the term for the first applications of discoveries at universities and research institutions. The government could follow the example of the United States, where the government acts as a "client of deep tech companies rather than their project manager."

The association concluded from its own calculations that venture investments in this segment of the tech sector increased by about 15 percent in the Netherlands between 2022 and 2023. This is while total investments in the Dutch tech sector fell by 25 percent last year, partly due to higher interest rates and a weakening economy.

Techleap said attracting and retaining highly trained personnel is a big problem for young, innovative companies. Although the vacancies are not rising as fast as in the last few years, the job market is very tight. Workers from abroad are vital for this reason, and they believe that the government should keep the Netherlands as an attractive place for immigrants.

The start-up association has been lobbying for favorable tax arrangements for a long time. They also say a great deal can be done in the areas of diversity and inclusive thinking in the technological sector. A survey of employees showed that 45 percent of staff members in the tech sector with a non-Western background feel like they face bias and unfair treatment.