How Can An Economy Keep Growing?

A close look at the StartupDelta-Amsterdam Ecosystem

StartupDelta-Amsterdam finds itself at a particularly interesting point in its evolution. Several years of growth and startup successes have moved the ecosystem into the Expansion phase of our Lifecycle Model. But further growth is far from guaranteed–for any region for that matter. The Ecosystem Lifecycle is not one-way — this, indeed, is part of the purpose of the Lifecycle Model. Ecosystem supporters, both public and private, need to focus on taking the right actions at the right time to keep stoking economic growth.

Two years ago, StartupDelta-Amsterdam enjoyed the billion-dollar public listing of Takeaway.com. This capped a seven-year period during which the ecosystem produced 19 exits over $100 million: nine over $500 million and four billion-dollar exits. In 2017, however, the ecosystem had no billion-dollar exits.

Exits — especially large, high-profile ones — are important for several reasons. First, they send a signal to founders and investors all over the world that startup success can happen in a given place. This leads to higher levels of Global Resource Attraction. Second, big exits lead to a recycling of money, people, know-how, and experience back into the ecosystem. The story of every successful startup ecosystem includes an “entrepreneurial genealogy” where a big exit leads to a scattering of employees, founders, and funders to new startups.

And, of course, large exits generate economic value for the region, beyond just the startup community.

The Dutch government’s relatively new startup visa program should help on this front. While the Netherlands has historically attracted immigrants from around the world — and there is a high share of foreign-born software engineers working in startups — the StartupDelta-Amsterdam ecosystem is below the global median on the presence of immigrant founders. Immigrant founders bring not only new energy and ideas but also connections to their home countries that help build Global Connectedness.

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