New York Coaxes eFaqts and Plot to Expand from Netherlands to the U.S.
Startups from Portugal, the Netherlands, and other countries recently made the rounds in New York, looking for potential collaborators, investors, and new ways to set up shop in the United States. These individual efforts—run by organizations such as VentureOutNY and the Dutch consulate—may seem small but could slowly swell into an innovation front when viewed together.
Early this month, the Consulate General of the Kingdom of the Netherlands, alongside WeWork SoHo, held its first New York demo night for Dutch startups culminating in the inaugural Holland in NYC Boot Camp. The initiative, which brings promising companies from the Netherlands to the U.S., was conducted simultaneously with a similar program and demo event for Dutch startups in San Francisco.
Yvette Daoud, consul for economic affairs of the Netherlands to New York, says the plan is to bring more entrepreneurs to both San Francisco and New York to demonstrate what they are capable of and to find new opportunities. “We will look at the possibility of doing this twice a year,” she says.
The companies in the program complete an extensive questionnaire and receive input from venture capitalists and IT professionals to decide whether New York or San Francisco, which has hosted the Dutch initiative for some five years, is the right destination. The startups “have to choose which environment fits best,” Daoud says.
Scalable innovations in IT, she says, get priority when picking Dutch companies to bring stateside. Startups sent to New York versus San Francisco, she says, tend to focus on such areas as media and apps. In general, the companies in the program plan to expand across multiple markets. “Since we have many languages in Europe, they often have ideas that are easily translatable into other languages,” Daoud says. “They need to come to America because when they have a scalable idea this is where the big market is.”
Members of New York’s business and venture capitalist communities comprised the jury at the local demo night that picked the best pitch and best overall startup. A startup called eFaqts, which offers students help with understanding textbooks, was named the pitch winner. “It puts together on the Internet all the tips and tricks to absorb information,” Daoud says.
Plot, which has developed a location-based marketing plug-in for apps, was the overall winner. “Their app helps retailers send pop-up messages to clients that are walking by,” Daoud says.
Dutch entrepreneurs already have a history of bringing technology businesses to the U.S. Tech hubs in the Netherlands birthed 3-D printing company Shapeways, which has offices in Eindhoven and now has its headquarters in New York, and augmented-reality company Layar in Amsterdam. Daoud says Plot and eFaqts are in talks to expand their respective operations to New York.
Daniel van Vulpen, area director in New York for the Netherlands Foreign Investment Agency, says part of the initiative’s goal is to foster communication between New York’s startup community and Dutch cities such as Amsterdam. “When you are a tech startup you want to expand to the other side of the Atlantic very soon and at a very early stage,” he says. “We also see New York startups being very interested in European markets.”
Naturally, access to funding in New York is also a draw for Dutch startups. “There are VC funds in the Netherlands as well, but the network is a lot bigger here,” he says. Daoud concurs, explaining that in Europe the bulk of investments in startups come from banks, with a smaller pool of funding from private investors.
The Dutch are far from alone, of course, in the desire to establish relations with New York’s startup and funding communities. VentureOutNY’s Portuguese Tech Night, run on June 10 in conjunction with the Portuguese Trade & Investment Agency, gave eight startups the chance to pitch ideas to local investors including Brian Cohen, chairman of NY Angels, and Deborah Jackson, founder of Plum Alley and co-founder of Women Innovate Mobile.
Brian Frumberg, founder of VentureOutNY, says these types of events and connections are chances for New York to benefit from innovation being created overseas, while giving the startups access to more opportunities. He says, for example, the city offers startups a chance to stay readily connected to other parts of the world, allowing them to work in tandem across borders. “Many of these startups leave development [teams] back home at least to start,” he says.
During their stay in New York, the Portuguese companies with VentureOutNY visited local startups Sailthru, LocalResponse, and AppyCouple; the NYC Economic Development Corp.; NY Tech Meetup; Entrepreneurs Roundtable Accelerator; and ff Venture Capital. Another VentureOutNY demo night, planned for July, will showcase startups from Brazil.
Frumberg says he hopes to bring the separate efforts by different international groups together to make such missions to New York more efficient.
He says most of the visiting startups could easily survive and grow abroad; however, the investment communities in other countries tend to be more risk-averse than those in the U.S. “There is a lack of early-stage capital abroad even in some of the largest technology ecosystems, including Brazil, Germany, the Netherlands, and the United Kingdom,” he says.
Though it may be rare to find large groups of investors in those countries willing to risk money on companies that are pre-revenue and pre-launch, Frumberg says, the international ecosystem is changing with the advent of budding accelerator programs. “The ice is starting to crack,” he says.