Startup Ecosystem in Amsterdam

Our last guest lecturer for the program, Tom, spoke with us about the startup and innovation ecosystem that is ever present in the Netherlands, specifically Amsterdam. He himself is an architect but is very active in the startup scene as he has some of his own startups and does advising of other projects because of his knowledge and experience. He explained that the startup culture and his involvement in the startup culture in Amsterdam go back to the 2008 financial crisis. The crisis disrupted the economy and society as banks stopped loaning money, which in turn caused firms to stop building and investing in new developments. As a result, there was little to no need for architectural designers and therefore, an oversaturation of them in the marketplace. So, many like Tom took his knowledge and experience elsewhere. For Tom, he turned to technology and the startup scene as he saw a close relationship between architectural design and app/computer design. Since this transition, Tom has created multiple apps, one of which being his waste management app that allows people to connect and share their waste to someone or to a charity that want it and could use it. He capitalized on the economic and societal shift towards a sharing economy, which is particularly present in Amsterdam. In such a sharing economy, consumers can become the provider of new services. People share their resources with each other and fully own products less often. One of the best examples of this is car sharing. Though it has begun to take form in the United States, I think we can all agree that it is much more common in the Netherlands and really fits into the European and Dutch lifestyle. This leaner lifestyle matches he trends we are seeing in startup culture itself. Entrepreneurs are now working more towards a leaner startup plan than the traditional business plan that aims to set everything in stone from the start. Instead, the lean startup model, as Tom explained, takes into consideration that innovation and the lifecycle of a startup is all about learning and improving as you go along. To start, it is certainly important to have a good plan as to where you want to go and how you plan to get there, but at the same time, it is important to understand the dynamic nature of startups as things change, both on an internal and external level. For that reason, the lean startup model champions the idea that innovators and entrepreneurs should plan to make modifications as the startup progresses in order to improve the product or service and adapt to the changing conditions that are unavoidable. In addition, it champions constant feedback and making little iterations of the product or service to provide the most value with the least amount of effort. Entrepreneurs always need to figure out what is relevant for the user base and adapt, which can often be done using different models of scaling.

Tom also noted how 60% of businesses are startups and as a result of the economic downturn, deserted parts of the city were colonized by startups. This was a catalyst for change that was fortunately supported on multiple fronts. Co-working spaces have been developed and capitalized on for free or low cost spaces to work on a new venture. The government and municipality also support the startup culture by providing any resources that it can to help propel the innovation in Amsterdam. As a result of all of this support and development in the startup ecosystem in Amsterdam, the city is commonly rated as one of the top five innovation cities, startup cities, and livable cities.

As someone who is quite interested in entrepreneurship and involved in the entrepreneurial community in Pittsburgh, it was particularly interesting to learn about the startup ecosystem in a city on the other side of the world. One thing that stuck with me after Tom’s presentation and many of the other site visits and presentations we have had was that many innovations in Amsterdam revolve around sustainability. I suspect that this is not merely a trend but instead is a result of how the Netherlands perceives sustainability practices. Such practices and sustainable measures are pursuing and invested in for practical purposes. This is strikingly different than many other countries, like the U.S., in which we too often see sustainability being used primarily as a marketing tactic rather than being used for practical, efficiency reasons.