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Dutch tech sector at crossroads: growth is stagnant, and expat tax scheme policy is challenging


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The Netherlands boasts one of the strongest tech ecosystems in the world. Amsterdam-Delta is the top-ranked startup ecosystem within the EU for the second year in a row; Paris, Berlin, London, and Stockholm follow.

Despite the Dutch tech sector still being one of Europe’s best performers, investments declined by 25 percent last year. The Netherlands counted no new “unicorns” (private startups worth more than $1 billion) in 2022 and 2023, and there were no Dutch IPOs – no Dutch company went public – in the past year. Whereas the UK and France are seeing the tech ecosystem grow, the sector is stagnating in the Netherlands. The tightened expat regime is also a point of concern for the industry. These are the main conclusions from Techleap’s The State of Dutch Tech 2023 report, which will be officially presented today during a conference in The Hague.

Why this is important

Techleap – a non-profit organization helping to quantify and accelerate the Dutch tech ecosystem – presents its State of Dutch Tech report. The paper outlines some of the challenges the tech sector faces, such as growth slowdown and the changing policy regarding the expat tax break regime. It also provides information on the growth of investment in deep tech.

Techleap’s special envoy Constantijn van Oranje warns, “The Netherlands must avoid becoming merely a consumer of technology rather than a producer.” The good news is the potential is there. Dutch research institutes are generating promising deep-tech start-ups. However, these are not adequately supported with capital and are not scaling up as in other European countries.

The lack of speed is evident in funding rounds. In the Netherlands, it takes a year longer between two successive rounds than the average in Europe. This results in less capital strength to take on foreign competition and grow, especially for large funding rounds. For early-stage rounds, however, there is plenty of capital available.

Deeptech nation

One positive trend is that companies in the deeptech sector are on the rise. Almost half of Dutch tech investments (48 percent) went to deep-tech last year, raising 15 percent more than in 2022. These technologies require long-term development and often have their origins in scientific discoveries. Whereas the total investment volume in 2023 fell by 25 percent to over €2 billion, investments in these technologies grew by 14 percent.

Calls to transform the Netherlands into a leading “deep-tech nation” are strong. The emphasis is to focus on growth markets and key technologies and establishing entrepreneurship as a logical career path for researchers.

The funding gap and talent shortage

A shortage of qualified personnel further exacerbates the funding gap. The tech sector in the Netherlands is struggling to attract international talent, partly due to a scaling back of the expat scheme. This arrangement must be “maintained to be competitive,” the report concludes. Late last year, the House of Representatives scaled down the expat tax regime: from five years of 30 percent exemption on wages went to 20 months.

The talent shortage, along with declining investment (25 percent) in the sector, ensures that no new unicorns or substantial IPOs were reported in the 2022-2023 period. Given the crucial role such success stories play in strengthening the local ecosystem, this is a worrying development.

Constantijn van Oranje emphasizes that the Netherlands must improve its ability to turn scientific knowledge and technology into successful companies. The sector is becoming increasingly dependent on foreign investors, which increases the risk of losing Dutch knowledge and entrepreneurship, the tech envoy said. It is not only a question of money but also of preserving the Dutch identity within the global tech landscape.


There is also good news. For example, Dutch scientific research is “driving promising ventures with potential for social and economic impact,” according to the report. These figures are based on data from 2022.

The emphasis on “valorization” has caused universities and knowledge institutes to increase their efforts to support science-based ventures. The number of successful spin-offs has grown significantly over the past eight years. The impact of the COVID-19 pandemic appears to be causing the numbers to decline after 2020. Techleap expects this growth to continue next year.

Grafiek: Techleap

Regional specialization

Techleap stresses the importance of regional specialization and advocates a coordinated approach at the national level. This could strengthen support for tech entrepreneurs and connect individual ecosystems within the Netherlands. There is a clear need to train local talent better and make the tech sector more inclusive, primarily by increasing the participation of women entrepreneurs and broadening diversity within founders.

A McKinsey analysis shows that increasing diversity among startup founders could lead to a 35—to 45 percent increase in the number of new startups by 2030. This would substantially strengthen the Dutch start-up ecosystem and contribute to the creation of new, innovative ideas and companies. Diversity is not only a moral or social aspiration but also an economic necessity that can drive industry growth.

Lots of Dutch innovation in healthcare, food, and semiconductors

In the Netherlands, sectors such as healthcare (€591 million), food (€257 million), and semiconductors (€216 million) stand out when it comes to raising capital. Semiconductors, in particular, set a high-profile growth: from €14 million in 2019 to €216 million in 2023. Fintechs and software companies, on the other hand, raised less new capital. In these sectors, 60 percent less was invested than last year. At the European level, it is notable that funding for energy technology is increasing dramatically. In five years, investments in it increased fivefold from €2,81 billion to €15,08 billion.

Key recommendations

  • Structural investment in the tech sector is necessary. These companies offer solutions to problems in health care and climate, for example. Moreover, they will create many jobs in the future.
  • Make the Netherlands a deep-tech nation. Focus on growth markets and key technologies and make entrepreneurship a logical career step for scientists.
  • Train more local talent, make the tech sector more inclusive, and do not abolish the expat scheme. This is the only way to (partially) solve the talent shortage.
  • Promote regional specialization but coordinate it at the national level.

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