Dutch Software Innovation – We’re Scaling Up!

The Netherlands is scaling up its investments to become a true (software) innovation country. We initially thought we were half way there, but new research suggests we are skidding past that half way mark.

Common measurement points for these indices include human capital & research, knowledge & technology output, R&D and patent investments, access to education and financial markets as well as sophistication of infrastructure. In short: for these elements The Netherlands walks the walk.

EU Member States’ Innovation Performance 2016

On the software side there are signs of a positive uptake as well.

  • Last November the BSA released a study that states Software in Europe to be a €910 billion catalyst for the EU Economy. Though the Netherlands was not one of the countries profiled in detail, the Netherlands accounts for 5% of the European software market.
  • Both the large vendors as well as smaller software startups show promising results with respect to growth. In our recent Fab 30 companies, there is a significant amount of software companies.
  • AFAS grew its revenue by 16% in 2016, showing a stunning €107million in revenues and a profit of €44million. Chipsoft, though it does not publish its revenues, grew its workforce by 15%. Other software companies also showed growth though more modest.
  • There are more initiatives than ever entering the market to support (software) startups in their scale up activities, think High-Tech Campus, Startup Bootcamp etc. For the first time in 7 years the number of fast growing companies in the Netherlands has grown again.
  • The number of start-ups receiving significant investment (>€10M) to actually scale up is growing as well (e.g.,Bynder, Pyramid Analytics).

What will this bring in 2017?

The Netherlands has a rich innovation history. Heineken once again hits the nail with its Heineken Invention commercial  where Heineken wins the Grand Prix of the World Exhibition Paris in 1889. At the time Mr Heineken was able to stand even in the illustrious company of Thomas Edison and Gustave Eiffel.

Right now a company like Heineken is still making strides to stay on top of the market. Though innovation may not come from new beer inventions, the company is making an effort to use IT to stay innovative in its business processes. Since 2011 the company is repositioning itself to be an innovative and digital partner to both its customers and suppliers. It does so on the front end as well as the back end.

If digital innovation is a measure point for innovation, the Netherlands is gradually increasing its footprint.  Larger vendors are increasing their digital spend to remain relevant in the area of innovation.  Add to that the shift from start-up to scale-up, also witnessed by venture capital investments, the innovation climate in the Netherlands is likely to benefit. We expect 2017 and 2018 to become crucial digital innovation years.

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