Eindhoven Biz Briefing: More capital, more talent … could this be the start of something big?

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(Editor’s note: This 9 July 2024 edition of the Eindhoven Business Briefing is part of our Tech Tuesday series. Dispatches covers tech because so many of our highly skilled internationals are founders and entrepreneurs.)

Europe’s startup scene has a risk capital problem. The problem is wealthy people and institutional investors are reluctant (to put it mildly) to risk investing in anything but real estate.

Slowly but surely, that’s changing.

Several small VCs in Europe, and here in the Netherlands, have announced new funds in recent weeks, days and months.

• Amsterdam-based Innovation Industries announced the Innovation Industries Fund III last month. The 500 million euro fund will invest in deep-tech startups and scale-ups in the Benelux and Germany.

• imec.xpand is connected to imec, the big Leuven, Belgium-based R&D institute. This independent VC fund just announced a 300 million euro fund to invest in the semiconductor and nanotech sectors, core Eindhoven biz categories.

• Vsquared Ventures, the Munich-based VC, has closed its early stage deep-tech fund of 214 million euros. EU Startups calls this “the largest European early-stage deep tech fund to date,” which tells you all you need to know about early stage investment here. But hey, if you have the startup, they have the capital, with total assets now under management at 450 million euros. 

Most European VCs have a few hundred million euros under management. The largest Sand Hill Road VCs have 10 times or even 100 times that. Andreessen Horowitz (aka a16z), the largest American VC, currently has $35 billion in assets under management and is always raising more funds.

So, why is this leading the EBB? Because some risk capital is better than no risk capital. And the more innovation you fund here, the more innovation stays here – a virtuous circle of startup creation.

LUMO Labs announce new 100 million euro fund

Speaking of fresh capital, this just came over the transom: LUMO Labs, based at High Tech Campus Eindhoven, just announced this morning (9 July) a new 100 million euro fund.

LUMO Labs focuses on United Nations Sustainable Development Goals. The new fund “means an expansion in capital for more regional diversification and more room for follow-on financing to increase the financial, social, and environmental return on its investments,” according to the media release we got.

Focus areas include Good Health and Well-being, Quality Education and Sustainable Cities & Communities, Climate Action and Digital Security. Investment categories include the Internet of Things, virtual and augmented reality, blockchain and especially (deep-tech) Artificial Intelligence, according to the release.

During the next four years, LUMO Labs will invest in approximately 30 to 35 impact-driven digital technology startups with LUMO Rise Fund. Startups that get funding enter LUMO Labs’ venture-building support program.

You can read more about LUMO Labs here in Dispatches’ archives.

Gerard & Anton Awards refreshes Eindhoven’s talent pool

Speaking of capital, money chases talent. So, it’s important that Eindhoven refresh its talent pool as local companies are acquired by, well, those avaricious Americans. Just in the past couple of years, American cybersecurity giant Synopsys Inc, acquired Pim Tuyls’ Intrinsic ID and Snap, owner of Snapchat, snapped up GrAI Matter Labs.

So, it’s a big deal to recognize emerging startup teams at each year’s Gerard & Anton Awards, named for the two Philips family members who transformed the Dutch company from a lightbulb maker into a global electronics giant.

We were at this year’s event at High Tech Campus Eindhoven and there were multiple impressive teams among the 10 winners:

• SCIL Nanoimprint Solutions. That just trips off the tongue, doesn’t it? It doesn’t have to because this is not a consumer-facing startup. This is a Philips spinout that is basically ASML 2.0, a photolithography technology that lets chipmakers pattern nanostructures on large chip wafers. The company has raised 12 million euros so far. This is the sort of semiconductor related startup that defines Eindhoven.

• Sandgrain is a variation on Intrinsic ID’s exploitation of chip irregularities for cyber security authentication. The Gerard & Anton magazine states that Sandgrain uses an “electronic barcode.” Which is where they lost us. A barcode is a physical stamp read by scanners. Reading their website, we see Sandgrain uses something called hardware tokens hardcoded into devices combined with a cloud platform for authentication.

• Senergetics is a bit more prosaic than the above mentioned startups, using photonic sensors to detect corrosion under the insulation at factories or whatever. Kinda boring, but there are an awful lot of pipes at an awful lot of factories that are corroding as we speak. Which makes Senergetics’ market big and global, what VCs want to hear.

• Eindhoven isn’t exactly a hot medtech/biotech center. But this is an interesting concept. UPyTher (what’s up with the crazy names?) uses a new therapy of injecting chemotherapy into the abdominal cavity to stop the metastasizing of gastrointestinal and gynecological cancers.

• Whispp is a new startup that just entered LUMO Labs’ venture builder program on High Tech Campus Eindhoven. It uses AI to help reconstruct the failing voices of the elderly, the ill and the speech-impaired so they can once again speak with their natural voices. Again, this is a global market of millions.

All the 2024 winners

• VitalFluid
• UPyTher
• Sirius Medical
• TracXon
• Senergetics
• Veridis
• Sandgrain
• Dembrane
• Whispp
• SCIL Nanoimprint Solutions
• Golden Pear: Starnus

This year’s event, the 10th anniversary edition recognizing a total of 100 winners, drew the biggest crowd we’d seen since we started attending in 2016. So, momentum is building. Kudos to Bart Brouwers, Bert-Jan Woertman and Beatrix Bos for putting on a smooth event.

Coders play at PSV Stadium

Starting today through 12 July, JuliaCon and PyData Eindhoven, two big developers conferences are at PSV Stadium just north of Eindhoven’s Centrum.

That organizer Gareth Thomas needs a football stadium to accommodate everyone is pretty amazing.

Thank goodness Philips, Innovation Origins and Bert-Jan Woertman created the Gerard & Anton Awards, named after the Philips scions who built the company back in the day.

Gareth sent us some numbers, and they are impressive:

• We sold more than 149,000 euros worth of tickets and got over 120k euros in sponsorships.
• We have over 300 speakers, 8 tracks with 700 attendees expected for four days.
• We had 498 proposals (people submitting talks for the event).
• There will be 6 keynotes on the football pitch with people in the stands.
• TU/e is hosting one day, and PSV 3 days.
• We will be streaming live on YouTube.
• There is free daycare for all attendees across all 4 days.
• We have more than 50 volunteers (one is a professional female hockey player aspiring to be a data scientist).
• Every hotel in Eindhoven offered up a 15-percent discount for attendees.
• All proceedings go to NumFOCUS.
• This is the biggest paid AI conference in Eindhoven.

Question for you:

• Is this the biggest paid technical event Eindhoven has ever hosted?

Anyone? Anyone? Bueller?

Quick hits:

Innovation Origins has an important post about the 30-percent ruling, the decades-old policy of giving expats working at companies such as ASML and Philips a skip on taxing the first 30 percent of their wages. The emerging far right parties in the Netherlands hate it because it attracts foreigners, and they want to abolish it. That would be a huge mistake, say the CEOs of the Netherlands’ largest tech companies, two of which are headquartered in Eindhoven.

The post cites a study that says plans to reduce the tax relief from 30 percent to a stepped 30-20-10 percent this year could lead to a 10-to-15-percent decrease in highly skilled migrants, with a potential 40 percent drop if the tax exemption is completely abolished. We’d just like to point out that other countries such as Croatia and Lithuania are emerging as tech hubs, so the war for talent will only increase in intensity.