(Editor’s note: At Dispatches, our mission is all about the global mobility of talent. This Eindhoven Business Briefing focusing on Eindhoven startups is part of our Tech Tuesday series.)
Is this your year to jump into a startup?
Not long ago, worthy European startups were dying on the vine for lack of capital. In just the past two years, American investors have discovered the unexploited riches of European startup ecosystems. Now they’re mining the gold. Twenty twenty-one will go down as a $100 billion year – the amount invested in European startups – as a new herd of European Unicorns emerge.
One of the findings of a new report on tech in Europe finds American investors like the fact that a lot of veteran talent from conventional European tech giants and engineering firms is now drifting to startups, which is the case here in Eindhoven.
This just in from the Wall Street Journal:
Europe has overtaken China in creating billion-dollar tech startups, according to a new analysis that points to Europe’s rising status in the field and the effect of Beijing’s crackdown on capitalist entrepreneurialism. Both economies still lag behind the U.S. in creating so-called unicorns.
The WSJ and other media outlets have spent the last few days digging through the State of European Tech 2021 annual report from Atomico, a London-based venture capital firm founded by Swedish entrepreneur Niklas Zennström, who founded Skype.
Europe has 98 new unicorns this year, bringing its total to 321, according to Atomico. How many of those are in Eindhoven? So far, the answer is none, though several scale-ups are approaching $1 billion Unicorn valuations including:
- JW Player, the video platform that was born in Eindhoven, raised $100 million this past June.
- SendCloud, an e-commerce shipping platform, raised $177 million in September from SoftBank Group.
The Atomico report points out that Europe is stronger in tech/deep tech than the United States at the moment, though consumer-facing startups coming out of The Valley and Austin still get more investment.
From the WSJ post:
Europe continues to produce more tech IPOs than the US, $1B+ IPOs are becoming the norm and record-breaking exit activity reached an astonishing $275B in deal value. Still, Europe is only in the first innings of its tech journey, with all indicators now pointing towards many trillions in value to be added over the next decade, even in a conservative scenario.
The post, which should be required reading for all Eindhoven-based entrepreneurs and venture builders, includes these tidbits:
• Dominant U.S. tech companies including Amazon.com Inc., Alphabet Inc. and Facebook have established research centers in Europe or partnerships with universities to tap into the continent’s immense talent pool, cheaper than top U.S. talent.
• European startups generally get lower valuations than their U.S. counterparts, “attracting deal-hungry American investors.”
• American investors also like stability and predictiblity, and Europe – unlike China – is politically and economically stable and democratic.
The problem we see is that too many Europeans view American venture capitalists as “vulture capitalists,” trying to buy up Europe. But the truth is, those VCs and private equity firms have the resources to buy up Europe. So, for us, the smart move for Europe is to look for a symbiotic relationship, not an adversarial relationship. And we should point out that unlike Amsterdam and other cities, Eindhoven has the advantage of having a single point of entry for its deep-tech startup ecosystem, High Tech Campus Eindhoven, with two venture builders and several public-private initiatives funding photonics.
Eindhoven’s next big tech sector?
With ASML and NXP, Eindhoven is already dominating Europe’s semiconductor sector. Will EV batteries be next?
We’ve been writing a lot about electric vehicles/electric cars lately, and the transition away from internal combustion engines is, um, accelerating. The main obstacle is that batteries don’t deliver the same distance as petrol and can take hours to fully recharge.
The buzz on the street is that Eindhoven will solve that technical challenge, becoming the center of Europe’s EV battery industry. There are already signs of that. LionVolt, which started at TNO Holst Centre on High Tech Campus Eindhoven, just raised 4 million euros from Dutch VC Innovation Industries as well as from BOM, the local economic development agency, according to a news release.
LionVolt comes out of six years of battery design R&D at TNO.
We looked at co-founder Sandeep Unnikrishnan’s LinkedIn bio. Dr. Unnikrishnan has both a business background and an engineering background, so this is a company to watch. And we’ll have more in the next EBB on the EV battery sector.
PhotonFirst raises 11 million euros
This is another very, very promising deep-tech scaleup from EIndhoven. Now based in Alkmaar (but with Eindhoven operations), PhotonFirst uses photonics to make ultra-sensitive sensors for aerospace, automotive and other sectors. They just raised an 11 million euro Series A round, according to a media release. The new capital is courtesy of Amsterdam-based private equity firm Active Capital Company and PhotonDelta, a public-private initiative to advance integrated photonics based on High Tech Campus Eindhoven.
The plan is to take 15-year-old PhotonFirst, which started out as Technobis, public in 2025. What’s amazing is, PhotonFirst made it 15 years before they had to raise an A round, which usually happens within a couple of years for U.S. startups.
Carbyon is racing to save the world … no pressure
With two venture builder/accelerators, Eindhoven is creating startups faster than we can keep track. Several are on break-out tracks for 2022, including Carbyon.
In the startup world, the rubric is, if you solve a crucial societal problem, success is inevitable. And Carbyon solves the crucial challenge – the survival of humanity – by reducing carbon dioxide in the atmosphere and halting global warming.
Hans De Neve and his team came together in the HighTechXL deep-tech venture building program a couple of years ago. Now, they’re poised to start tests with lab-scale models of their CO2 capture machines on the way to final tests and, maybe, mass production.
You might say timing is everything as the global climate heats up and becomes more extreme.
You can see the full Carbyon interview and profile here.
More housing coming
As Eindhoven’s tech ecosystem grows and prospers, the question becomes, where will we put all the talent? A question we’ve addressed several times. The good news is, new projects are starting almost weekly including the repurposing of the abandoned Campina dairy operations on the edge of centrum into De Caai, 430 mid-range apartments in a multi-tower complex along Eindhoven’s lone canal.
The concept is especially interesting because it’s billed as both housing and as a maker lab for sustainable living.
By the way, the Dutch housing market reached a milestone in June – the 8 millionth home was added to the Netherlands’ housing stock. For context, the 7 million homes milestone was reached in 2005. So it’s taken 16 years to add another 1 million homes in a country with a population of 17 million.
A total of 39,000 homes were added to the Netherlands’ housing stock in the first six months of 2021. In absolute terms, Amsterdam got the most new homes with more than 4,000. But in relative terms, Roermond, south of Eindhoven, saw the biggest increase in number of homes at 4.4 percent as it turns into the Dutch Miami, a retirement destination on the water. In this case, the draw is the Maasplassen recreation area and its marinas and luxury apartments. Oh, and nude beach.
See our Tech Tuesday archive here.