This is a summary and a transcript from panel discussion “Bridging Dutch Biotech Excellence with Global Entrepreneurial Opportunities”, that we hosted at the Nucleate Netherlands Launch Event, on 11th of June in Utrecht. The discussion was moderated (and transcribed!) by William Lake (WL).

Panel Overview

Panelists will compare the Dutch and American entrepreneurship cultures and discuss the differences, as well as challenges and opportunities this leads to. The panel also creates an opportunity to discuss if startup founders should think about going global from early on, and the mindset shifts this may require. The learning goal for this panel is to understand how Nucleate’s mission can translate at a national level, and how the ecosystem can best benefit from it. The panelists will highlight opportunities and programs that facilitate the mobility of biotech and entrepreneurial talents, companies and investment opportunities between the Netherlands and abroad. The panel will feature four panelists, including members from a Dutch globally diversified biotech VC firm, the Netherlands Foreign Investment Agency and Health~Holland, as well as an early-stage entrepreneur with experience with the US bio-entreprenurial ecosystem.

Discussion Recording

Unfortunately, the quality of recording is poor due to technical difficulties on our side. Sorry! To accommodate for this, we have transcribed the full discussion, and you can enable subtitles or read the full transcript below.

Top Takeaways

  • The Netherlands is a good place to start a deeptech company thanks to a business friendly infrastructure, number of early-stage funding opportunities and a deep talent pool.
  • The Netherlands is, however, a small market and companies must look for growth opportunities abroad from the get go.
  • While there is less capital than in the US, it gets you further. This keeps the environment attractive for VCs who gain the opportunity to earn higher multiple.
  • Mindset shifts to empower Dutch and European bio-entrepreneurs:
    • 1) Failing = Learning, 2) Give-back mentality, 3) Don’t be afraid to ask!

Additional Remarks

  • The Netherlands has excellent clinical trial infrastructure.
  • Dutch and European biotechs tend to be patient-centric, including patients from the early on.

Discussion Transcript

WL: I’d like to invite our next round of panelists down. And while they’re getting down here, thank you all for coming and especially thank you to our panelists. So today’s panel will be focusing on what some of the strengths are of the Dutch local biotech ecosystem, but then also what we can learn from other global biotech ecosystems. So Boston, San Francisco, we have a strong Nucleate presence there.

But before we get started, I’d like to introduce our panelists. So from left to right here, we have Cinzia Silvestri. Cinzia is the CEO and co-founder of Bi/ond. She is a Termeer fellow, which she can tell us a little bit about later in the presentation, and holds a PhD in microelectronics from TU Delft. And Bi/ond is a tech bio company that uses microelectronics to develop a human-like system for disease state development. Next we have Keno Gutierrez. He’s a general partner at BioGeneration Ventures. And as part of his role at BGV, the CEO and founder of Brandaris Therapeutics. Prior to BGV, he worked at M Ventures, where he was responsible for pharma and life science investment. And he has a PhD in genetics from UCL London and an MBA from Insead.

Next we have Kianti Figler, who is the CEO and co-founder of Upstream Foods. Upstream Foods is a new cultivated seafood company that is using fat cells to create sustainable and healthy cultured seafood products. And lastly, we have Jeroen Krüter, who comes to us from the Netherlands Foreign Investment Agency. This is part of Invest in Holland, which tries to get international companies to establish a footprint here in the Netherlands. As part of his time at the NFIA, he also worked with the New York City office in the States. So today we will be focusing on, as I mentioned, what we can learn from some of the other global biotech ecosystems.

WL: And so to start us off, I’d like to ask Kianti about your experience starting a company here in the Netherlands. What are some of the strengths of the local Dutch biotech ecosystem? And are you already thinking about scaling abroad with respect to talent, operations and finance?

KF: Yeah, I’ll start off by saying thank you for having us. So just to give a little bit of context, I can only speak to my own experience here, but we started from zero. So we’re not a spin out. We didn’t take any IP with us from anywhere. We were a team with an idea, kind of crazy and we figured let’s give it a go. I think for us the early stages here in the Netherlands were great. There’s some small brands that you can apply for and for us that’s what really got us started that little pre-seed funding. Then that next phase, that little bit of a bigger jump in funding was harder for us as a deep tech company. You’re too early for a lot of venture capital. You’re too risky for a lot of the regional development agencies. And we actually went to to Denmark, to the Bioinnovation Institute to apply for funding there. That’s what really allowed us to rent our lab, hire first people and kick it off and get to a point where we are interesting enough for venture capital. I think that the Netherlands is great in terms of talent. There’s really top notch talent here that is excited to work for startups, very mission driven and oriented.

So yeah, I mean that has been our journey. I think there’s a lot of value here in terms of talent, grants to support you along the way, mentors who are willing to help out and share their experience. I’d say that’s been my experience so far. As a cultivated seafood company, we would have to apply for novel foods regulation, which means that per definition, the Netherlands, and Europe is kind of a tough market for us to launch in, which means that we are looking to the US to not only scale, but even launch our first product, which is a challenge, but also an opportunity I think. And I think we’re already here in the Netherlands, so let’s move our product activities to the US.

WL: And Cinzia, how does that compare and contrast with your experience starting Bi/ond?Are you also feeling some of these regulatory pressures? I know that your company has, for example, lots of partnerships with European hospitals to create these clinically relevant disease states. So are you also thinking about expanding your operations abroad at this point?

CS: Yeah, let’s say right now we have around 15 customers between academic hospitals and pharma in Europe and the UK. But of course, like I think every start-up should think from the beginning that they are at least European, if not global start-ups. So the Netherlands is really a nice place to start some product concepts, really get a foot into the ecosystem because there are so many excellence in the academic sector as well as pharmas. But then if you want to be successful, you have to look abroad. So then basically that’s what we are doing right now. By the end of the year, we plan to work the first three customers in the US and this month it will be the biggest big pharma that we have right now that is in the Boston area. So basically it’s like really planning for starting to get a foot at least depending on let’s say the kind of background that your startup has, but an example in our case is going to be Boston is the place to be. And basically like really starting to develop your network there also with other peers, it really has to be in your strategic plan from the start.

WL: And Keno, we’ve already touched a little bit on funding. I was wondering if you could tell us a little bit about the difference in the VC field between the US and here in the Netherlands. How easy is it for, you know, young companies to find funding here in the Netherlands? And then also maybe some differences in investment strategies that you might find between the US based and the EU VC.

KG: Yeah, absolutely. Good afternoon everyone. Happy to be here. Well so, to come here. I was working from home, took my bike to the train station, took a train, rented another bike and came here. Super easy. And that’s a good analogy for how the infrastructure in the Netherlands is set up. There’s a lot of support for business. There’s very friendly environment for business, very easy to set up a new company. There’s a very good rule of law in terms of corporate law which makes new financings very easy to to come together because it’s very friendly for new investors to to come. There’s an educated workforce, it’s a very deep talent pool, so it’s very easy to recruit people and it’s very well connected. So it’s very easy to put together syndicates from around Europe and the US. So it’s very similar in terms of corporate governance and corporate law compared to the US.

So there’s a lot of similarities and at the moment there’s what people call an arbitrage, so difference in what one can get for the same amount of capital here versus in the US particularly in areas like Boston or San Francisco. So that is a key difference because investing here locally we can push things further with the same amount of capital. So there’s some interesting similarities, there’s some differences in general bringing people on board, it’s easy. So as long as there’s good science. I’ll give you a couple of examples. So I work for BGV. We were the founders of a company called Acerta Pharma which got in like and eventually got sold to AstraZeneca for $7 billion. And now we started here in the way we brought in investors from the US, high caliber and, there's multiple examples, you know, the portfolio will be getting started and then bring US investors and so forth.

WL: And then Jeroen, so a lot of your work involves bringing either foreign, US or otherwise companies here to the Netherlands to set up operations. So what are some of the strengths the local Dutch biotech ecosystem has that these companies that are looking to relocate are looking to leverage?

JK: I think a lot has already been said by these people and I love that their companies are kind of also ambassadors for life science and health ecosystem. Over the last couple of years, a couple of organizations from the Ministry of Health and Ministry of Economic Affairs really figured like, OK, how do we sell the Netherlands to abroad? And we came up with the sentence “Europe’s connected life science and health metropolis”. It’s a bit long, but it will stick at one point. And what does that connectedness say? That can kind of be divided in three things. So first of all, logistics, that’s what the Netherlands is known for. It’s DHL #1 for already like 15 years. So it’s the roads, but it’s definitely also the air for pharma transports Schiphol, but also Maastricht are both pharma gateways for all of Europe. But it’s also digital. We have the fastest fiber internet in Europe here in the Netherlands because we have the Internet Exchange. So we’re already quite good at AI. But now with the merger with life sciences, you see a lot of digital health companies popping up in the Netherlands and choosing the Netherlands for their expansions. The second one is collaboration. That’s already set by the other panelists. So it’s really that collaborative ecosystem working together. How can we create together even more value than we do by ourselves? And the last one is of course talent, very highly educated, English speaking, innovative talent like you guys are. And that’s really a value for the Netherlands and that’s what foreign companies see as an added value and why they would like to move to the Netherlands as well.

WL: Great. And then kind of flipping that question on its head, what we do to keep companies here, talent here, for example, Kianti illustrated that maybe she will set up ooperations in the US because of the regulatory environment. Is there stuff that the local ecosystem can do to continue to make it more appealing to keep your operations here?

JK: Well, that’s more on the practical side. We need more power and electricity. That’s a bit of an issue now. But for the rest, it’s really trying to continue on that collaborative ecosystem. But also organizations like yours, like Nucleate, making that bridge with America. So it’s actually that physical bridge, having that here showcasing what we can do. And how we even can become better at what we already do?

WL: Great. So we’ve touched on kind the local beginnings of a company, right? Like what starting a company is like here in the Netherlands. Most of the most exciting life science companies today are trying to solve global problems as Cinzia mentioned as well. You know, whether that’s agri-tech feeding a world that is increasingly affected by climate change, drug development for an increasing aging population. So for this next topic, and we’ve started to touch on this a little bit already, but I’d like to dive into some of the more cultural and intangible factors perhaps at play here in the Netherlands versus in the US. So Cinzia, you are a Termeer fellow, so first, could you tell us a little bit about what the Termeer Fellowship is? And in your experience as part of being a Termeer Fellow, what are some of the cultural differences that you’ve noticed between, say, US founders or US startup teams and EU founders and EU startup teams?

CS: Great. So let’s say a Termeer Fellow is part of our Termeer Foundation that is built up on the legacy of Henri Termeer. Henri Termeer, he was a great entrepreneur that was the CEO of Genzyme. He was the third biggest biotech company back in his days and basically he was sold to Sanofi and he was one of the first in the rare genetic disease space, and rare genetic is really hard business in the pharma sector. And what Henri was always doing is that he was mentoring a lot of first time CEOs and he created basically most of the CEOs that are right now in the Boston area. Unfortunately he passed away and his wife created a foundation based on his legacy to basically help people like me, first time CEOs, to connect with these great mentors that already have been there multiple times, so in all the ups and downs of the startups field. And basically as Henri was Dutch, I got the opportunity to have a special scholarship that is called Transatlantic Connection. That basically every year is given to a Dutch entrepreneur to connect to the Boston area. And that’s actually in one year time I had the opportunity to really learn a lot first hand about what is the Boston ecosystem, who are the major player because they have the opportunity to talk to these mentors, but also networking and knowing your peers and you will definitely see a bit of difference there and I will touch upon two main aspects.

The first one is the fear of failure. Every first-time CEO is afraid to fail. The one that did it multiple times, they really don’t care. They really take it as a proud moment because when they fail they learn a lot. But definitely like here is seen a bit more as a stigma and sometimes it stop us even from taking action. So don’t be afraid if you think you have a good idea, it is never the right time, just try and worst case you’re going to fail, but you have to learn a lot and that’s what I’m also trying to digest sometimes. And the second thing is the give back mentality. There is a great ecosystem there and the people that have done this journey before, they are always open to give you feedback. And to help you out, also sponsoring you, some of them are going to be your Angel investors or they’re going to be your advisor. An important thing that we have to learn is to ask. If you don’t ask, you don’t, you don’t get anything out of it. So it’s really important for us or everybody to keep on asking people if they can connect you with someone and for them, for people in the US probably it’s easier and also give back mentality when you’re getting somewhere. Remember what you all through the way and do the same with the new generation.

WL: Great. And Kianti, do you have some of the same experiences? So starting a new company, as you said, you were a couple people basically with an idea. What was your process like finding mentorship and people who can help you kind of start actually getting this company off the ground?

KF: Yeah, I can definitely relate to the first time CEO experience of being afraid to fail. I had to really shut that off in my brain, like, OK, that is a given that might happen, accept it, move on from it and and try anyways. I think for us, we were part of the Start Life Incubation Program at Wageningen, which really opened the door for us to an ecosystem, to an entrepreneurship ecosystem. Fellow start-ups and and mentors, which was for us really the beginning of tapping into some of those valuable connections of entrepreneurs around us, learning from their journeys, their experiences, getting their advice, but also people you know who have many, many years of experience in specific industries and who can connect you to the right people along the way. So I think for us an acceleration program was really the way to tap into that ecosystem because the ecosystem is here. I feel like sometimes in the Netherlands it can be diffuse and spread out and located in multiple places, unfortunately. But there are some strong connectors in this ecosystem that actively bring people together.

WL: Great. Yeah, that’s exactly what we’re trying to do here at Nucleate! So Keno, can you tell us a little bit about some pros and cons of foreign investment into a local firm? So specifically are there differences in say funding structures that you come across or maybe even something like expectations from a VC when you are say an EU based company and you go out and try and find the best US VC money?

KG: Yeah, definitely we could, we could always do more. Yeah, so. I think from a finance perspective, the ecosystem in the Netherlands is is quite deep. So it’s a history of - it’s a trading nation. You know the stock exchange started here and as I mentioned there’s quite a lot of laws and governance which makes it easy and this is what has evolved now into a very strong venture capital ecosystem so. Now if we look at the leading firms, leading rounds in early stage innovation all the way to crossover are happening here in the Netherlands. You got groups like Forbion, our sister fund, but als LSP/EQT, Gilde, as well as a much broader ecosystem of smaller groups that are really driving the innovation and so there is this spectrum of different pockets of money. Also there’s a lot of regional players that want to encourage innovation in the different areas and and through these you can really build companies and through this spectrum you get to the point where you can attract foreign foreign investor or international investors. And I think as you bring people on board, not necessarily just international investors, but every financing run, it’s very important to keep in mind the governance and how as an entrepreneur you want to build your syndicate and the person that brings in more money, not necessarily is there with the right partners. Sometimes it is, but it’s also very important to keep to keep in mind what culture you want to bring into the companies, like the US, you know, pour lots of money, move as fast as you can. Or take a more paced approach and validate concepts, try to be more capital efficient with a goal that you will sell at a higher multiple based on a lower base of capital invested. So also it’s important to keep in mind time difference! So it’s not the same working with a venture group that has got an office in Boston or New York than having all of your investor syndicate in San Francisco because then you’ll be working all the evenings. So yeah, some of these are considerations that practical considerations that one needs to keep in mind.

WL: and Jeroen in your work bringing companies to come here to the Netherlands. Does the cultural piece ever play a role? Are there, for example, is it something that you have to help people navigate a little bit as they choose to set up their operations here?

JK: Yeah, maybe less with American companies, more with Asian companies. There you see a big cultural change, and there you see sometimes that you can guide them through how the Netherlands works. I think as Dutch entrepreneurs, we can be a bit more competitive, maybe even a bit more arrogant. I was last week at the Bio International Convention in San Diego. And there you see those American entrepreneurs showcasing what they’re doing. And they have the best idea in the world. They’re going to raise millions of money. If you look really close, you’re like, yeah, I’m not sure. But they do showcase it like that. And that’s sometimes with a good story, you get money. And sometimes in the Netherlands, we’re a bit too kind, too hesitant. That helps with the very collaborative ecosystem that we have, because we all want to support each other. But I think there we can learn a lot from Americans. But then the other way around as well, there was a lot of stories about patient-centric research and I think we’re already doing that very well in the Netherlands and already incorporating that very well while that’s in the US. Still they’re like, no, I have a good protein, I’m just going to make medicine. I’m like, no, you’re doing it for a patient. And here in the Netherlands, some factories where they just produce the pills, those people go to those patient organizations, to the hospitals to actually see what they’re doing for and why they sometimes need to be so precise in their production because they’re going to cure it personally. And that’s I think a really great.

WL: So with that, we’re on our last five minutes here. So I’d like to open it up to the audience. Anyone has any questions they would like to ask to our panelists, if you can direct it to a singular panelist.

Audience: Yeah, very interesting discussion. And my question for Keno, because I know that in America, VCs, they have different strategies. Some are really builders who start with an idea and founders and they start building it into a company and others jump in later. Do you have any thoughts about that in the Netherlands? Is there a preference here or what do you generally think of that strategy, strategy in the Netherlands?

KG: Well, my strong preference is for entrepreneurs partnering with BGV. But more broadly, I think this is a very important question that you raised. Think who you want to work with and partner with because likelihood it’s going to be either a very long period that you’re working with that person or it’s going to be very short either because the company doesn’t work or because there’s a change of management. So I think it’s very important to understand what rapport, so intuitively what rapport one is building with the other party and I think this is the right person, this is the right group. Do we share the the goals in terms of how we want to build the company, how we see a potential exit and based on this make a decision. I mean I’ve been on all sorts of boards. So I’ve been in very functional boards where everybody’s very collaborative and there’s a shared vision and that makes it very easy to work and it’s really fun. And I’ve also been in some really dysfunctional boards where it’s every board meetings like the shouting and that’s not fun and it can be very distracting to the mission of the company.

WL: Great. If there are no further questions, I’d like to give a round of applause to our panelists today.