(Editor’s note: This edition of the Eindhoven Business Briefing dedicated to High Tech Campus Eindhoven is part of our Tech Tuesday series. Dispatches covers tech because so many of our highly skilled internationals are engineers and entrepreneurs.)
Sometimes, it’s good to be at the party.
Dispatches was at High Tech Campus Eindhoven’s invitation-only 25th Year Anniversary celebration “Rewind and Fast Forward” last Thursday. The party was part of a year-long series of special events. The event did indeed look back on how Philips executives assembled this one-square kilometer R&D park, which was later sold to private owners. But honestly, we were there to hear Oaktree Capital Management’s Hermann Dambach, a managing director and co-portfolio manager at the giant Los Angeles-based private equity firm’s European Principal Group.
Oh, and to party at a glamorous catered event in the summer tent by the lake.
Dambach is the highest ranking executive to speak publicly since Oaktree, in a partnership with Singapore’s GIC Private Limited, sovereign wealth fund, acquired the campus in August 2021. So, we were hoping he’d drop a few hints about what the future holds for what this third jewel in Eindhoven’s high-tech crown, along with ASML and NXP.
While Dambach played his cards close to his vest, he did have some news in his brief remarks for the 200 or so assembled guests representing campus companies and Eindhoven community.
• The Oaktree/GIC partnership plans further investment to expand capacity, modernize the buildings and provide more technical space.
• Renovation is wrapping at HTC 91. At 12,500 square meters, it is one of the largest HTCE buildings and certainly the tallest. Work will be complete by August, with Dambach gently chiding campus CEO Otto van den Boogaard: “Right, Otto?”
• Oaktree is committed to building a similar sized technical building, he said. “Everyone has been asking us for technical facilities.” That would include labs, which are difficult to find across the Netherlands.
In the previous 18 months, campus officials have announced plans to build multiple new buildings on the south side of campus, and the 11-story Lucis One is nearly complete. There are also plans to add short-term housing for transiting executives and make the campus into more of a destination, with more evening events and services.
In a 2022 interview with former communications manager Ingelou Stol, Dambach said he envisions at least 15,000 people working on campus, with the population at 12,500 now.
On Thursday, Dambach noted that many HTCE campus companies are working in AI and the semiconductor industry, “and we can be proud that HTCE companies are at the forefront of these efforts.”
Dambach, who’s based in Frankfurt, said he’d come from meetings with local officials and was satisfied there are plans in place to cope with rapidly expanding regional growth. “Our willingness to expand is matched by other mission-critical local efforts working together to prepare Eindhoven and Brainport for next level of its development,” he said.
He added that Technical University of Eindhoven, a crucial source of engineering talent, is committed to growing and that city officials are promising massive new housing projects and infrastructure upgrades.
The promise of growth is exactly why Oaktree came to Eindhoven in the first place.
Oaktree dealmakers were first in touch with HTCE owners seven years ago, but Dambach said as an investor, he was trained “to only invest in Randstad,” the huge urban cluster than includes Amsterdam, Rotterdam and Utrecht. “And I still dared to cross the border and came to Eindhoven against the advice of many.”
Even at that time, it was not lost on Oaktree executives that this was the fastest growing part of the Netherlands and Europe “and investing in growth is a very beneficial element. Growth meant people will stay, more will come and everyone will make a good salary.”
Open innovation is the rule on the campus and they and the region are working together to make this the growth engine of the Netherlands, Dambach said.
Several retired Philips executives talked about how they designed the campus, from the thousands of small saplings planted instead of mature trees to the choice of parking garages instead of parking lots around buildings and the exclusion of canteens in each building in favor of restaurants in the center where employees would all gather.
“People think great business cultures are defined by the great things they do,” said Arthur van den Poel. “That’s not true, though. It’s what they think is normal” that sets them apart … that Philips believed that revolutionizing electronics every day was normal.
Eindhoven Mayor Jeroen Dijsselbloem said the central government will spend 4.3 billion euros in Brabant during the next six years in part to keep ASML, where the leadership was (is?) contemplating moving to a more business-friendly country.
“All the attention is focused on ASML,” Dijsselbloem said. “But I’m convinced the next ASML will be developed here at HTCE.”
Our main takeaway: Oaktree is all in on its investment in the campus, underlined by the presence of a top executive who reports directly to Oaktree co-chairman Howard Marks in LA. The asset management giant has a massive amount of capital under management, approaching $200 billion, according to one insider. Investments range from High Tech Campus to the troubled Inter Milan football club, which the firm acquired in May.
A shift in philosophy at High Tech Campus
In 1999, High Tech Campus Eindhoven was a closed Philips stronghold, “maybe a closed city, where the most brilliant inventions were being created at the physics lab, NatLab, in the utmost secrecy, said CEO Otto van den Boogaard.
Now in 2024, there are about 300 companies, and maybe 13,000 people working in a philosophy of open innovation.
“Where it used to be that knowledge was power, we now know that sharing knowledge multiplies power,” said van den Boogaard. “You can’t do everything yourself.” Holst Centre was the first non-Philips entity on the campus. “This partnership set the stage for an open innovation ecosystem to drive advancements to the next level,” he said.
The event recognized top campus residents including:
• SMART Photonics
• Salvia, which is pioneering new biometric treatments for migraine.
• Carbyon is tackling climate change head on with carbon capture technology.
• “In Axelera AI, we might have the next NVIDIA,” van den Boogaard said.
• Global companies, including Philips, Teledyne Dalsa and NXP.
Axelera scores another big raise
The pressure is on emerging deep-tech companies to sustain Eindhoven’s ecosystem. At the Rewind and Fast Forward event, Otto van den Boogaard called the campus “a breeding ground for innovation, where talents collaborate and people push boundaries and shape the future.”
Which is happening.
HTCE-based startup Axelera AI made global headlines last week with the announcement that it has raised an additional 63.5 million euros. Axelera, founded in 2021, has raised more than 130 million, including 46.25 million euros Series A round about one year ago.
The new round was backed by existing investors — Innovation Industries, CDP Venture Capital and Verve Ventures – as well as Invest-NL, and the European Innovation Council and an investment fund from Samsung Electronics are now also on board, according to media reports.
We should have known something was up when co-founder and CEO Fabrizio del Maffeo took his entire team to a retreat in Spain last month.
Axelera appears to be just the right technology at just the right time, developing a chip and software for AI at the edge – i.e., integrated into devices, not cloud based.
At a campus Lunch & Learn last October, del Maffeo shared his experience of growing a high-tech startup at breakneck speed.
Fabrizio made it clear: the journey with Axelera AI has been a rollercoaster so far, full of highs and lows, unexpected challenges and lots of hard work. He had plenty of lessons to share with startups looking to grow rapidly.
He has a very un-European outlook that’s closer to Steve Jobs’ “startups are fighting the war every day” philosophy.
Here’s a quick look at what we learned:
• Forget work life balance. Building a successful startup quickly is not for the faint of heart. Forget 9-5 workdays, weekends, holidays and free time. As Fabrizio says, “You have to run, run, run like a high speed train.” So, maybe cancel those flights to Ibiza …
• Execution is everything! Unlike large companies, startups and small businesses have speed on their side. Even with a smaller team and less funding to work with, startups can deliver outcomes very quickly – as long as you’re focusing on concrete action and execution.
• Ditch your Plan B. Growing quickly requires 100 percent dedication to Plan A. Having a Plan B can easily become a distraction, especially if you and your team are spending precious time and energy thinking about a Plan B.
• Developing a strong team with a healthy company culture is essential. Spending time building a resilient, talented team of people who share a vision will always pay off.
• Keep your focus, even in the face of failure. “As soon as you go fast, nothing will be under control. You have to accept these things. You lose customers, you lose product, you lose employees. Keep focused.”
QUICK HIT:
Though they’re now based in Rotterdam, Nearfield Instruments is a spinout of TNO on High Tech Campus and have offices here. This company is an example of what we’re all working toward. Nearfield develops machines that can detect inaccuracies at the atomic level during the production of computer chips.
They just signed Samsung, one of the world’s largest chip manufacturers, as a customer and will soon close a new financing round of “at least 100 million euros,” according to a media release.
Co-CEO of Dispatches Europe. A former military reporter, I'm a serial expat who has lived in France, Turkey, Germany and the Netherlands.
