More than 2,700 international companies have already settled into Amsterdam, and between 100 to 200 new arrivals move into the Dutch capital each year. But since it has only 800,000 residents—and twice the amount of bicycles—the city doesn’t seem to be the most likely place for such a business boom. So what’s going on?
To put it simply, history repeats itself.
Before we go into the how and the why, it’s worth taking a quick leap into the past. Amsterdam has a long history of commercial expansion, and the trading gene is rooted deeply in its citizens. Between 1600 and 1800, often referred to as the Golden Age, the Dutch dominated the world economy and had fleets sailing in the East and West Indies. In fact, the Dutch East India Company is considered to be the world’s earliest multinational corporation. It was also the first company to issue stock, and founded the first stock exchange in 1602.
Chris Yerbey, CEO of the fast-growing startup Scrap Connection, says that the spirit of expansion is still alive and well in Amsterdam.
“Amsterdam is built on trade, and you can sense that in everything,” says Yerbey, whose office is located in the city’s WeWork Weteringschans. There is a pro-business climate in which people are terribly open-minded compared to other cities I’ve lived in.”
Yerbey says the city places fewer obstacles in the way of new companies.
There is a less structured way of dealing with things and more thinking out of the box,” he says. “This allows for creative solutions, which is an ideal foundation for startups.”
It’s hard to argue with this, as Amsterdam is the home to internationally known startups like TomTom and WeTransfer. And Booking.com and other big names in the tech world had their start here.
What’s so irresistible about Amsterdam? It’s an international city where 90 percent of the population speaks fluent English. Compared to other European startup hubs like London, the cost of living in Amsterdam is much more affordable. It has a village vibe, which makes it an easy place for newcomers to feel comfortable.
The downside is that some growing companies find office space hard to find, although a growing cluster of collaborative workspaces like WeWork have eased the burden a bit. The population of Holland is just under 17 million, so companies hoping to scale have to look to the rest of Europe and beyond.
Envisioning Europe’s ‘West Coast’
Ever seen a nature documentary where a gigantic sperm whale is surrounded by hundreds of smaller fish? Several Dutch multinationals—including Heineken, Phillips, and Booking.com—have made their headquarters in the capital. Other international powerhouses like Uber, Netflix, Tesla, and Cisco Systems joined them because of the tax incentives.
The presence of these behemoths has attracted many medium-sized companies. And all of these need a wide range of smaller companies offering assistance on everything from advertising and branding to tech support. This provides a healthy business environment for a growing group of startups.
The Dutch government is well aware of Amsterdam’s draw for startups, and is doing everything it can to make the city welcoming to new companies. It’s eased tax regulations for foreign businesses and has introduced special visas for entrepreneurs moving here from abroad.
It also launched an ambitious plan called StartupDelta that aims to make the Netherlands the largest startup ecosystem in Europe. This public-private partnership is helping people find jobs in startups, sponsors networking events, and helps connects entrepreneurs and venture capitalists. Amsterdam is its main focus, but it also hopes to foster a startup culture in a dozen other Dutch cities.
StartupDelta is the brainchild of the European Union’s Commissioner of Digital Agenda Neelie Kroes, regarded as the continent’s “digital czar.” Her passion has been for creating a climate that’s welcoming to new companies, especially in her native country of Holland.
How committed is she? Just last year she vowed to make Amsterdam the “startup capital of Europe’s West Coast.”
People whose companies are based Amsterdam have said that they are impressed by the pro-business environment. Paige Douglass director of design at Amsterdam’s The Scale-Up Group, says she has done business in several countries in Europe, but found the Dutch extremely friendly and open to new ideas.
“The economy is forever changing, and we can’t keep copying old business models,” says the WeWork Metropool member. “The Dutch seem to get this and keep inventing new ways to move forward. This attitude draws in people who think likewise. It’s an inspiring environment and I love the fact that we can be part of it.”