Dutch universities, despite their prowess in deep-tech research, grapple with the challenge of nurturing successful tech spin-offs. While the Netherlands leads in research, it falls behind the UK, Germany, Switzerland, and France in creating successful tech spin-offs. The growth rate of these spin-offs is sluggish, with only 48% of them employing more than 10 employees a decade after their inception.
- Dutch universities have initiated standardised deal terms to make the spin-out process more transparent;
- Despite challenges, there are pockets of progress in the Dutch tech spin-off landscape, like the new deal terms;
- KU Leuven is Europe’s most innovative university for four consecutive years with 135 spin-off companies
Stakes and Shares: The Balancing Act
The proportion of shares universities claim in their spin-offs is a point of contention that often stymies the growth of these nascent companies. Start-ups that relinquish more than 10 percent of their shares to universities are often seen as less profitable, which can discourage potential investors.
In response, Dutch universities have initiated standardised deal terms to make the spin-out process more transparent. These agreements lay out various options for transferring intellectual property, including equity packages and license agreements. Nonetheless, striking the right balance between the universities’ involvement, which builds trust, and the allocation of shares, remains a complex task.
Case in Point: The Cradle Conundrum
Highlighting the intricacies of this issue is the case of Cradle, a Dutch start-up that chose to work with US universities due to the difficulties of collaborating with Dutch institutions. This scenario underscores the need for Dutch universities to foster a more conducive environment for their local spin-offs, to prevent them from seeking partnerships abroad.
Spurring Growth: The Role of Venture Capital and Innovation
Despite these challenges, there are pockets of progress in the Dutch tech spin-off landscape. Round One Ventures, a new venture capital fund, aims to support student start-ups, while ReCarbn, a spin-off from the University of Twente, is one of the first companies to spin out with the new deal terms.
Nevertheless, the process of spinning out remains slow due to extensive paperwork and the requirement for detailed forecasts. Simplifying funding processes and providing initial grants could accelerate the path to commercialisation, leading to more efficient and effective application of scientific research.
Lessons from Leuven: A Belgian Success Story
While Dutch universities grapple with these issues, their Belgian counterpart, KU Leuven, stands as an exemplar of successful spin-off creation. Named Europe’s most innovative university for four consecutive years, KU Leuven boasts 152 spin-off companies, demonstrating that successful spin-offs are achievable with the right support and infrastructure.
One of the university’s success stories is ArtiQ, an AI-based software company that supports doctors in diagnosing and treating respiratory illnesses. The company’s founders benefitted from KU Leuven’s tech transfer office which provided expertise in collaborative agreements, business development, funding, and intellectual property.
The Road Ahead: Fostering a Sustainable Ecosystem
The comparison between the Dutch and Belgian university spin-off landscapes underscores the importance of fostering a supportive ecosystem for spin-offs. Such an ecosystem offers not just financial support but also provides guidance in business development, collaborative agreements, intellectual property, and access to a network of experienced entrepreneurs and investors.
As universities strive to bridge the gap between invention and commercialisation, the role of university spin-offs becomes increasingly crucial in advancing living standards and securing a bright future. In the Netherlands and indeed across Europe, the journey to harnessing the full potential of tech spin-offs has only just begun.