Over 3,200 Dutch startups hit scale-up phase

The Netherlands is seeing a significant increase in the number of startup companies hitting their scale-up phase, according to researchers at Erasmus University Rotterdam. Last year 331 startups grew into fast-growing companie, compared to 98 in 2014. The Netherlands now counts 3,200 such companies, a five percent increase compared to last year, BNR reports.

A scale-up is a company with at least 10 employees that grows at least 20 percent per year for three years. These fast gowning companies created almost 39 thousand jobs in the Netherlands over the past three years, Justin Jansen, Professor of Corporate Entrepreneurship at the Rotterdam School of Management said to the broadcaster. "In two years' time we saw more than 200 percent growth in companies that have existed for less than five years and are growing into a scale-up. That is explosive, I'd say."

According to Jansen, the scale-ups owe their success for a large part to their ability to respond to new technologies and make them applicable to customer solutions.

But while startups are growing explosively, more and more established companies are barely growing at all, and a third is even shrinking. The group of stable or shrinking companies already comprises nearly 85 percent of Dutch SMEs, according to Jansen. As a result, the growth of the Dutch economy is increasingly dependent on a relatively small group of companies able to adapt to the changing environment.

While the number of startups are reaching their scale-up phase, the Netherlands' work is still far from done, Prince Constantijn, special envoy of the Netherlands' startup program StartupDelta, warns. In order to stay on track with cities like Stockholm, London, Paris and Berlin, the Netherlands really needs to speed up - never mind catching up to countries like China, Israel and America, the prince said, according to the broadcaster.

The first problem for startup companies is building credibility, and patronage is needed for that. "In the first phase, if you do not yet have a customer and no market, it is not interesting for an investor. This is a phase in which the government has a big role and where family, friends and fools jump in", Constantijn said. "Then there is an important role for the government to provide the first contracts as a potential launching contractor."