At the beginning of the year, news readers were treated to images of German police forcefully removing climate activists from the village of Lützerath to make way for an open-air coal mine. Indeed, Germany may have averted a looming energy crisis this past winter by upping its coal consumption.
While prioritising energy independence may have caused a detour from the transition to renewables, the country’s goal is to reach climate neutrality by 2045: five years ahead of the EU target. A small step on the way but a step nonetheless is Europe’s first solar panel roof-covered cycling path which opened this week in the city of Freiburg, about a two-hour drive south of Stuttgart.
The photovoltaic (PV) pilot project consists of a 300-metre-long installation featuring over 900 translucent glass solar panels, and will generate around 280 MWh of solar power per year. Solarwatt, the producer of the panels covering the path, says they are particularly durable as the solar cells are enclosed on the front and back by robust glass panes.
Existing infrastructure has increasing role to play
The cleantech company now has three decades of experience creating solar panels and currently employs over 800 people across Europe. In 2022, it acquired Utrecht-based battery-storage specialist REConvert for an undisclosed amount, establishing a Dutch subsidiary.
Solarwatt’s CEO Detlef Neuhaus believes rethinking photovoltaics will be essential for Germany’s transition to clean energy, and sees an untapped potential in already existing infrastructure.
“Already sealed areas such as parking lots, paths and roads are playing an increasingly important role,” Neuhaus said. “We are proud that we could contribute our part to the success of this innovative pilot project.”
Credit: Badenova AG & CO
The modules used in the bike lane project have general technical approval from the German Institute for Building Technology (DIBt). This means that they can be used without any restriction for both private and public projects, without the need for case-by-case testing.
Solar-powered neighbour stadium
Meanwhile, the pilot bicycle lane is situated close to the SC Freiburg football stadium. The arena is already equipped with a 2.4MW solar panel roof, courtesy of around 6,000 heterojunction solar modules from Swiss manufacturer Meyer Burger.
This makes it the third-largest solar panel installation on any stadium in the world. (The largest belongs to Turkish Süper Lig football club Galatasaray’s home arena Nef Stadium, which comprises more than 10,000 panels.)
The potential for much longer PV-roofed paths
This may be Europe’s first solar panel roof-covered bicycle path (excluding several projects where the path itself has been covered with PV panels). However, since 2014, South Korea boasts a 9 kmbicycle lane covered by a roof made of solar panels.
This 4-metre wide lane runs in the middle of an eight-lane highway, and connects the cities of Daejeon and Sejong. Its 7,502 solar panels are capable of producing 2,200MWh per year – the equivalent of powering around 600 households, according to the country’s Ministry of Land, Infrastructure and Transport. Several other Korean cities have implemented the technology, but this remains the longest and most power-generating project to date.
Get the TNW newsletter
Get the most important tech news in your inbox each week.
While the UK is being labelled as “closed for business” and Rishi Sunak is playing Unicorn Kingdom in Silicon Valley, the British chip industry risks losing some of its strongest players due to a lack of supportive policies.
Based in Cambridge, UK, Pragmatic Semiconductor, funded in part by the CIA’s investment branch In-Q-Tel, has created an ultra-thin, ultra-low-cost, flexible integrated circuit (FlexIC). Instead of relying on silicon, it is made from indium gallium zinc oxide at a fraction of the cost.
The application of the technology spans a wide range of sectors, including healthcare, pharmaceuticals, packaging and games. In the words of Pragmatics, it offers “digital traceability and interactivity to everyday objects.”
Scott White is the Founder and Executive Director, Strategic Initiatives, of Pragmatic. According to White, the company could end up leaving British shores if the UK government’s semiconductor strategy fails to meet expectations.
So what would British politicians need to offer to provide adequate support to rival the allure of the US $52.7 billion CHIPS Act? White tells TNW that Pragmatic wants to see the government support innovative new companies through public procurement.
“By creating home-grown revenue opportunities, and becoming a major customer for new semiconductor technologies addressing key national priorities such as net zero and affordable healthcare, the government can provide the reassurance and certainty that investors need to support startups and scaleups,” White said.
Following the lead of Arm?
The current lack of ability to effectively raise funding for the business in the UK means that Pragmatic could move its operations overseas. Furthermore, it could potentially list outside of the UK in the future, following in the footsteps of Cambridge-compatriot Arm. Earlier this year, in a significant blow to London, the chip architecture giant and crown jewel in the UK tech industry chose to only list the company in New York.
What would a sufficient strategy look like in more detail? White believes that annual public sector procurement targets, commitments for public institutions to ‘buy British’, and encouraging public bodies, like NHS Trusts, to explore uses of the technology, would provide the required opportunities.
Furthermore, such a strategy would address both supply and demand, ultimately making “the UK a more attractive place from which innovative semiconductor companies can build and maintain a global base.”
Funding from the government, the CIA and… China
After a Series C $125 million round (an oversubscription by more than 50%) late in 2022, the CIA’s investment branch In-Q-Tel, also referred to as IQT, owns part of Pragmatic. British Patient Capital, a subsidiary of the UK government’s economic development bank, also participated in the funding.
The company has now raised over $190 million to date and employs over 200 people. Puhua Capital, a Hangzhou-based VC focused on health and technology, has also invested an undisclosed amount. Although, Pragmatics has intentionally kept Chinese investment low, due the sensitive geopolitical situation.
The geopolitics of chip-making capabilities
According to Chris Miller, the author of Chip War: The Fight for the World’s Most Critical Technology, the process of designing and manufacturing chips is the most complex technological process that humans have ever undertaken. In Miller’s words, the supply chain needed to produce an advanced chip “stretches across multiple continents, involves some of the most purified materials, and the most precise machine tools ever made.”
In 2022, the global semiconductor market size was over $573 billion, and is predicted to grow to $1,380.79 billion by 2029. Meanwhile, Miller further believes that it is not only a matter of business, economics or technology, but also a question of political relevance as to which countries have these capabilities and which don’t.
As such, successful startups like Pragmatic could find themselves caught in strategic tug-of-wars, stretching well beyond the scope of applied technological excellence.
Get the TNW newsletter
Get the most important tech news in your inbox each week.
Wherever you fall on the quantum sceptic spectrum, you cannot deny that the potential of the technology is fascinating. Don’t worry, we will admit to not understanding it fully yet either, but the founders of QuiX Quantum do.
Together with scientists from the Leibniz University Hannover, the team has demonstrated a fully-integrated quantum light source on a chip smaller than the size of a one-euro coin.
The study, called “Fully on-chip photonic turnkey quantum source for entangled qubit/qudit state generation,” just FYI, was published in Nature Photonics this week. Its results could reportedly prove a game-changer for technologies such as quantum computing.
Photonics offer temperature advantages
Quantum photonics is a field of research that explores the behaviour of light and its interactions with matter at the quantum level. Quantum light sources produce photons that can be used as quantum bits, or qubits. One of the main advantages of photonics compared to superconductor approaches is that it is compatible with room temperature operating conditions.
However, most sources are external laser systems, making them bulky and non-reproducible and thus unsuitable for out-of-lab use or production at larger scale. Integrated, or on-chip sources are becoming popular due to being more compact and stable.
A fully-integrated light source, such as the one demonstrated by QuiX and Leibniz University scientists, will allow all stages of the Quantum Information Processing (QIP) to be on a single chip, which will lead to greater stability and scalability of the technology.
Plug-and-play photonics solutions
QuiX Quantum was founded in January 2019. Since then, the company has raised over €5.5 million in funding and already become the European market leader for quantum computing hardware based on photonics. They sold their first quantum processors in 2021, and are building 8- and 64-qubit Universal Quantum Computers worth €14 million for the German Aerospace Center.
The company says its goal is “the continued disruption of quantum computing with our high-tech, scalable, future-proof, plug-and-play integrated photonic solutions.” Its recent breakthrough could not come at a better time. The EU has just launched a €19 million project to help quantum startups transition from lab to market.
Earlier this year, QuiX Quantum took home the prestigious Prism Award for its 20-mode Quantum Photonic Processor. This award is known as the “Oscars of Photonics,” presented during the Photonics West conference in San Francisco.
“In four years, we went from an idea to delivering award-winning, market-leading hardware for photonic quantum computing,” Stefan Hengesbach, CEO of Quix, stated. “This awarded processor is the core element of our current generation quantum computers, which has already created a huge impact in the quantum ecosystem as an excellent tool to perform fundamental quantum mechanical experiments on-chip.
Get the TNW newsletter
Get the most important tech news in your inbox each week.
Anyone who has ever experienced phantom ringing in their ears knows that it is a nuisance to say the least. Those who have tinnitus – hearing continuous ringing, buzzing, humming or even roaring sounds – often experience anxiety and depression as a result.
The condition affects approximately 15% of the global adult population. However, treatment has remained elusive, with those afflicted left to find their own ad hoc mitigation solutions.
Neuromod, a medtech startup from Ireland, is looking to change that. The company has just received €30 million in funding to further commercialise its tinnitus treatment device, Lenire.
A different kind of electrotherapy
With its patented bimodal neuromodulation technology, Lenire works by sending mild electrical signals to the tongue, while patients listen to auditory stimulation through headphones.
Thus far, over 700 patients have participated in clinical trials with the device, which consists of three parts. A handheld, lightweight controller allows the user to control timing, intensity and synchronisation of the stimuli, while Neuromod’s proprietary Tonguetip module sits in the user’s mouth, administering electrical pulses to the top of the tongue. Simultaneously, Bluetooth headphones deliver customised sound stimuli to the auditory nerve.
The <3 of EU tech
The latest rumblings from the EU tech scene, a story from our wise ol’ founder Boris, and some questionable AI art. It’s free, every week, in your inbox. Sign up now!
Taking Neuromod across the Atlantic
As with most medtech, due to regulatory procedures, the company’s trajectory from inception to trials to market is somewhat longer than for startups in other sectors.
Neuromod Devices was founded in 2010, and the funding raised this week brings the total capital raised to over €55 million. The latest round consists of €15 million in equity investment and €15 million in venture debt, with the latter provided by the European Investment Bank.
The equity investment is led by Panakés Partners, a venture capital firm based in Milan, with the expressed goal of “providing a better life to people all around the world.” Panakés Partners’ managing director Alessio Beverina will join Neuromod’s board.
Existing investor Fountain Healthcare Partners also participated in the expansion of the Series B funding.
With the previous round of Series B funding, which took place in 2020, Neuromod used the funds to expand its presence across Europe. This time, while still looking to increase accessibility to the device in new European markets including the Netherlands, Sweden, and Italy, the funds will also support the launch of Lenire in the US.
The company has already established a wholly owned subsidiary, Neuromod USA Inc, and gained De Novo approval from the FDA. Initial patient treatment in the US will begin this month.
Tinnitus treatment is one of the largest unmet clinical needs in the world. For some of the millions of people suffering from phantom sounds around the clock, perhaps Neruomod’s Lenire could provide relief from the constant uninvited companion in their ears.
This story is syndicated from the premium edition of PreSeed Now, a newsletter that digs into the product, market, and founder story of UK-founded startups so you can understand how they fit into what’s happening in the wider world and startup ecosystem.
Whether you believe it’s the future of everything, or just a useful tool that will be part of the mix of tech we regularly use a few years from now, augmented reality is a rapidly developing field with one major drawback – like VR, it can leave you feeling sick.
For example, US soldiers who tried Microsoft’s HoloLens goggles last year suffered “‘mission-affecting physical impairments’ including headaches, eyestrain and nausea,” Bloomberg reported.
While the technology could “bring net economic benefits of $1.5 trillion by 2030” according to PwC, this sickness is a massive inhibitor to the growth of AR and VR.
One startup looking to tackle the problem is Cambridge-based Lark Optics, which has developed a way of bypassing the issues that cause these problems.
“In the real world, we perceive depth by our eyes rotating and focusing. Two different cues need to work in harmony. However, in all existing AR glasses, these cues fundamentally mismatch,” explains Lark Optics CEO Pawan Shrestha.
Having to focus on a ‘virtual screen’ on augmented reality glasses, means users have to switch focus between the real world and the augmented one. This depth mismatch causes physical discomfort and conditions like nausea, dizziness, eyestrain, and headaches.
What Lark Optics does differently, Shrestha says, is it projects the augmented reality image onto the user’s retina. This means the AR is always in focus no matter what your eyes do to adjust to the real world around you.
So far the startup has developed a proof of concept and is now iterating to refine its demonstrator model. Shrestha says they conducted two successful user studies with their proof of concept; one in their own lab and another with an external partner he prefers not to name.
When the tech is ready, they want to use a fabless model for producing the components they design, which they will then sell to original equipment manufacturers who make AR headsets.
Given they’re addressing such a fundamental challenge to the mass adoption of AR, it’s unsurprising that other companies are tackling it in other ways (more on that below). But Shrestha says his startup’s approach is the most efficient in terms of processing power and battery power, and doesn’t affect the user’s field of vision.
Shrestha grew up in rural Nepal (“really rural… I was nearly nine years old before I saw electric lights”). He says his parents’ enthusiasm for his education eventually led him to New Zealand where he obtained a masters degree in Electronics Engineering from the University of Waikato.
Keen to develop technology he could commercialise, he says he developed an interferometer. While that venture didn’t work out, his work led him on to a PhD from the University of Cambridge, where he spotted the commercial potential of a new approach to AR displays.
“It was scientifically challenging, but it was also something that could touch the lives of many, many people,” he says.
Shrestha co-founded Lark Optics (which was previously known as AR-X Photonics) with his friend Xin Chang, and Daping Chu who previously oversaw the PhD work of Shrestha and Chang. The trio have been working together for around a decade but only got started with Lark Optics in earnest last year,
Shrestha says this week they have been joined by a new recruit, Andreas Georgiou, who previously worked at Microsoft as a principal researcher in the field of optical engineering.
The Lark Optics team (L-R): Weijie Wu, Dr Pawan Kumar Shrestha, Professor Daping Chu, Dr Andreas Georgiou, Dr Xin Chang
Perhaps unsurprisingly, Shrestha says being based in Cambridge is a big benefit to them, with a community of experienced advisers around them, and access to relevant investors. He is particularly inspired by the progress made by Micro LED tech startup Porotech, which has raised a total of $26.1 million to date.
And Shrestha has warm words for the Royal Academy of Engineering’s Enterprise Fellowship, of which he is a part. This provides up to £75,000 in equity-free funding to cover salary and business costs, along with mentoring, training and coaching. This was what allowed him to get started on developing Lark Optics as a business.
Lark Optics itself raised a pre-seed round of £210,000 in October last year, Shrestha says, and will be raising a seed round in Q2 this year.
As mentioned above, others are tackling the problem of AR sickness in different ways. LetinAR uses a ‘pin mirror’ method, Kura Technologies has developed a ‘structured geometric waveguide eyepiece’, while VividQ “compute[s] holograms in real-time on low power devices and integrate[s] them with off-the-shelf display hardware.”
Another company, SeeReal develops holography-based solutions to address depth issues in 3D displays.
But Shrestha says these rival technologies either require a very high level of data throughput, with a related computational and battery power overhead, or require very high resolution displays. And while some techniques decouple the AR display from the real world like Lark Optics does, Shrestha says they are “like looking through a chicken fence.
“We solved the problem without getting a significant penalty on processing power or battery power, or artefacts. So that’s why I think our approach is the best.”
Lark Optics’ ambition is to become established as the best optics for AR, VR, and mixed reality glasses.
“We want to realise the full potential of AR and VR. Now we have AR and VR you can wear for 20 minutes or 30 minutes. We want to make it feel as natural to look at real objects, VR ,or AR, and allow people to use it for all-day, everyday use.”
Shrestha sees the biggest challenge to achieving this is being able to recruit the right people in what is quite a specialised field. But he’s optimistic that attracting just one or two high-level people will end up attracting more, and the endorsement of a good seed round raise in the coming months won’t hurt either.
AR, VR, and MR has been massively hyped in recent years but there have been questions over how much of a future it has. Investor disquiet over Meta’s huge spending in the ‘metaverse’ space, and Microsoft’s job cuts in its HoloLens division as it struggles to turn it into a viable business, show that there’s no straight line from here to a future where this tech is widely used.
But that said, the current jitters of the public markets over stock prices and tech company spending isn’t an end for AR, VR, and MR at all. Apple’s first headset is on the horizon, which will no doubt spin up another wave of interest in the space (although the latest report says it’s been delayed two months, until June).
If technology like Lark Optics’ can help prepare AR, VR, and MR for the mainstream, the startup could be well positioned to reap the rewards.
The article you just read is from the premium edition of PreSeed Now. This is a newsletter that digs into the product, market, and story of startups that were founded in the UK. The goal is to help you understand how these businesses fit into what’s happening in the wider world and startup ecosystem.
Ioanna is a writer at SHIFT. She likes the transition from old to modern, and she’s all about shifting perspectives. Ioanna is a writer at SHIFT. She likes the transition from old to modern, and she’s all about shifting perspectives.
What is happiness? And how can we be happy? These questions are integral to the human experience, but their answers can be elusive. We can apply several perspectives to approach them, through philosophy or psychology, for instance. We can also use our personal view of our feelings and goals as we navigate through life. But can we bring a scientific approach to happiness?
Meik Wiking, CEO of the Happiness Research Institute in Copenhagen, believes we can. The institute combines qualitative and quantitative methods to provide insights on well-being, happiness, and the quality of life.
Its mission? To inform decision-makers in companies and communities of the causes and effects of happiness, and, in turn, make subjective well-being part of the public policy debate on a local, national, and international level.
We caught up with Meik Wiking at TNW 2022 and asked him the big questions around happiness. If you’d like to get his insights in full, check out the video embedded at the top of this article. Alternatively, you can watch it right here.
“Happiness is a dish with many different ingredients on it,” Wiking told us. “It’s about experiencing positive emotions on a daily basis, being satisfied with life overall, and having a strong sense of purpose or meaning.”
Above all, happiness is an emotion, Wiking explained, and as such it’s subjective. This means that individual perceptions of it vary, making each person the only judgeof whether they’re happy or not.
So what can we do to cultivate this emotion and be happier? Wiking suggests there’s an ABC in happiness as well. A stands for “act,” B stands for “belong,” and C stands for “commit.” In other words, these are the three steps: doing something active, doing something together with other people, and doing something meaningful.
But is happiness only a matter of perception or do external circumstances also play a role? And is it possible for the whole world to be happier?
Ioanna is a writer at SHIFT. She likes the transition from old to modern, and she’s all about shifting perspectives. Ioanna is a writer at SHIFT. She likes the transition from old to modern, and she’s all about shifting perspectives.
Although the UK has set out ambitious clean energy targets, it risks lagging behind the US and the EU in attracting the required investments, two of the country’s energy trade organisations have warned.
Ahead of the Chancellor’s Spring Budget next month, Energy UK and Renewable UK have published two separate reports, calling on the government to implement measures and rule changes that will enable the UK to attract vital private investment in renewables.
“The renewable energy sector is facing a perfect storm this year.
According to Energy UK’s report, investment in low-carbon electricity generation “has deteriorated significantly” in the past months, owing to soaring inflation, increasing interest rates, supply chain difficulties, policy uncertainty, and “poorly designed” windfall taxes that presently “favor oil and gas extraction.”
The trade organisation estimates that an additional investment of £500 billion would be needed between now and 2050 to meet the UK’s Net Zero goals. But without government action, it expects a £62 billion investment loss by 2030. This would translate to a shortfall of 54GW of potential wind and solar capacity — enough electricity to power every home in the UK.
“The UK is in increasing danger of undermining its own ambitions and failing to deliver on its commitments, “Emma Pinchbeck, Energy UK’s CEO, said. “In many ways, the UK has led the way in the transition to clean energy — witness our world-leading offshore wind industry — but we risk squandering this position and driving the investment that we need elsewhere.”
The fierce global competition for investment, skills, and supply chains was also cited by Renewable UK’s Executive Director of Policy Ana Musat, who highlighted that “the US and the EU are in a race to offer incentives to clean energy investors.”
Both trade organizations are calling for measures such as implementation of more attractive regulations, faster project planning, more sustainable renewable electricity prices, and new fiscal measures policies like reforming the windfall tax and respective tax reliefs.
“We are at a pivotal point right now with other countries actively trying to attract the same companies and investors and it would be unforgivably complacent to think that we don’t need to do the same,” Pinchbeck noted. “This is a once-in-a-generation opportunity and if we don’t seize it now, we will miss out not just on cheaper, cleaner energy but on the huge boost to our economy such investment will bring in terms of growth, jobs and other benefits.”
Get the TNW newsletter
Get the most important tech news in your inbox each week.
Ioanna is a writer at SHIFT. She likes the transition from old to modern, and she’s all about shifting perspectives. Ioanna is a writer at SHIFT. She likes the transition from old to modern, and she’s all about shifting perspectives.
According to EU data, numerous vital tech sectors in the bloc have been suffering from supply shortages in semiconductor chips, mainly as a result of the European dependency on imports from a limited number of companies and countries. To address this issue, the union aims to boost its domestic industry by implementing new legislation.
On Wednesday, the European Parliament adopted its position on two proposed draft bills: the Chips Act and the Chips Joint Undertaking.
On the Chips Act, MEPs endorsed the text put forward by the Industry Committee and expressed their support of its three main measures:
Reinforcing technological capacity and innovation and attracting talent.
Encouraging investment and increasing production capacity.
Implementing a crisis response mechanism, enabling the Commission to monitor semiconductor supply, assess risks, and anticipate shortages.
Commenting on the Chips Act, rapporteur Dan Nica said that it should establish Europe as a “key player” in the global semiconductor market. “Not only does the budget need to be commensurate with the challenges and funded through fresh money, but the EU should lead in research and innovation, have a business-friendly environment, a fast permitting process and invest in a skilled workforce for the semiconductor sector,” he added.
On a separate vote, MEPs also backed the Chips Joint Undertaking proposal, which implements the measures put forward under the Chips for Europe initiative, and complements the Digital Europe and Horizon Europe programmes. Its aim is to increase investment in research, development, and innovation infrastructure in order to bolster large-scale capacity building.
“Microchips are integral to the EU’s digital and green transitions as well as our geopolitical agenda,” rapporteur on the Chips Joint Undertaking Eva Maydell said. “We are calling for fresh funding that reflects the strategic importance of Europe’s chips sector. Europe’s partners and competitors are also investing heavily in their semiconductor facilities, skills, and innovation.”
The European Parliament is now ready to begin talks with the Council on both bills. If negotiations are successful, the Chips Act could be a game changer for Europe. Earmarked at €43 billion and aiming to account for 20% of the world’s supply by 2030, the act could help the EU reinforce its competitiveness and sovereignty in the sector.
The Dutch tech startup ecosystem has been steadily flourishing over the past five years, establishing itself as one of Europe’s most vibrant hubs. Yet, there are still hurdles the Netherlands needs to overcome in order to reach its full potential and successfully compete on a global scale.
That’s according to the annual State of Dutch Tech report by TechLeap, a non-profit organisation which helps quantify and accelerate the ecosystem in the Netherlands.
Here are seven key takeaways from the report you need to know about:
The Netherlands houses the EU’s most successful ecosystem
In 2022, the Amsterdam-Delta region was the leading ecosystem in the EU, overtaking Paris and Berlin. Globally, it ranks on the fourteenth place, behind cities in the US, Asia, and the UK.
However, the combined valuations of Dutch startups stagnated, with
the tech sector in the country dropping from the fourth to the sixth position globally at €0.4T in aggregate public market cap. The Netherlands is still the leader in the EU thanks to tech giants ASML, Prosus, and Adyen.
Fintech and healthcare were the dominant startup sectors in the country, with the first producing the greatest number of scaleups as well. The Netherlands also welcomed one new unicorn in 2022, bringing its total to 1.4 unicorns per million inhabitants. This places it above France (0.7) and Germany (0.5), but below Sweden (2.4) and the UK (1.7).
The tech sector is also growing outside the Amsterdam-Delta
Although the North Holland region remains the largest startup centre in the country, generating 38% of startups jobs, other local hubs are also growing thanks to regional specialisations and mutual cooperation.
For instance, North Brabant showed a 27% year-on-year growth in deeptech jobs, Utrecht increased its numbers of startups by 900, and Gelderland has become a leader in foodtech.
Job creation increases, but attracting talent remains a challenge
In 2022, startup-generated jobs reached 135K, rising from 109K in 2020 and 130K in 2021. Attracting tech talent, however, presents to be challenging for many startups.
Specifically, the percentage of hard-to-fill tech jobs has increased to 59%. On average, these types of vacancies stay open for more than 60 days.
This phenomenon occurred in other ecosystems as well, including Sweden, Germany, France, and the US.
Dutch startups struggle scaling up mainly due to lack of funding
The startup to scaleup ratio in the Netherlands (22%) is lower compared to other European hubs, such as Germany (37%), the UK (30%), and France (26%). That’s mainly because of insufficient capital.
In 2022, total VC funding in the Netherlands was €2.6 billion with the average funding being €0.26 million per startup. This was significantly lower than other major EU startup ecosystems. For reference, Sweden’s average was €0.9 million per startup.
Despite the Netherlands’ prowess in scientific and academic research, deeptech is amongst the underinvested sectors with €0.7 billion in funding in 2022 and a 23% startup to scaleup ratio.
On the brightside, investments on impact startups are on the rise with over €1 billion raised in 2022. And investments in all sectors overperformed pre-pandemic levels.
The gender gap
The gender gap is still a problematic issue within the industry. Just 10% of Dutch tech startups are run by women, and funding for female entrepreneurs is similarly insufficient. Only 0.7% of venture capital investments have been raised — since 2019 — by businesses with female founding teams, lagging behind the UK (2%), Germany (1.5%), and France (1.2%).
The potential for further growth
According to the report, the Dutch tech ecosystem has a massive potential of growth. In particular, it could add 250K jobs and €400 billion in value by 2030. This could be done by supporting the growth and impact of university spin-offs, bridging the talent and diversity gap, and cultivating a more resilient and internationally-embedded VC market.
Five EU member states and the European Investment Bank (EIB) Group have launched a new fund to support the late-stage growth of promising European tech startups and increase the continent’s competitiveness in innovation.
The so-called European Tech Champions Initiative (ETCI) aims to address the issue with inadequate late-stage funding, especially for companies seeking more than €50 million in capital.
Boosting European investment
“Europe’s tech startups often do not have sufficient capital to compete on a global scale and are pushed to relocate overseas. Closing this scale-up gap could create a large number of highly skilled jobs and boost growth,” the ECTI’s founders said in a statement.
“The European Investment Bank estimates that approximately 75% of European high-tech companies are acquired by non-European investors — predominantly American and Chinese — in late-stage development,” Nick Swan, serial entrepreneur and founder of SEOTesting, told TNW. “For the fund to be successful long-term, it will need to curb the trend of EU tech startups pushing to relocate overseas. It will also be telling if UK businesses begin to consider relocating to the EU to be able to get access to this big pot of funding.”
The ETCI has secured so far a total budget of €3.75 billion. Spain, Germany, and France have committed €1 billion each, Italy €150 million, and Belgium €100 million. The EIB Group has provided an additional €500 million. The funding capacity is expected to increase further in the future.
“This initiative is a striking example of what we can achieve collectively to strengthen the EU’s economic and industrial sovereignty,” Bruno Le Maire, French Minister of the Economy, Finance, and Industrial and Digital Sovereignty, noted.
The ETCI won’t subsidise startups directly, but will instead work as a fund of funds. In other words, it will deepen Europe’s scaleup venture capital (VC) funds “by bridging gaps in financing availability.” This way, it will help European institutional investors diversify their portfolio, while ensuring a continuous flow of capital to the continent-based scaleups.
“Much of this has to do with European strategic autonomy, which is something that leaders on the continent have to think about. By boosting the financial capacity of existing venture capital funds (and therefore financing scale-ups indirectly), they can make sure that European companies don’t get acquired by non-European investors, generally from the US and China,” Michaela Jeffery-Morisson, CEO and founder of Ascend Global Media (the company behind Women in Tech World Series), told TNW.
“There’s real value in supporting home-grown talent,” Jeffery-Morisson added. “Doing so will give European tech companies the freedom to concentrate on what they do and not get distracted wondering where money will come from. And this will also allow a distinctly European tech ecosystem with its own unique culture to develop.”
The way forward
While the ETCI is an exciting and promising opportunity for innovative entrepreneurs across the continent, financial support alone might not be enough.
Reduced bureaucracy and easier access to funds are critical, Oana Jinga, co-founder and CMO at previously EIC-funded Dexory, told TNW. “Startups need to operate at speed — the main advantage of being in innovation is to be first! So lengthy and time-consuming processes will quickly be dismissed for other options as they hold these high-growth companies back,” she explained.
Speaking to TNW, Lena Hackelöer, CEO of Swedish-based Brite Payments, identified two more requirements for home-grown innovation: cultivating a “startup-friendly environment” and implementing regulation that “supports” and “sets clear boundaries” for tech companies.
With the approval of the first investment applications under the ETCI potentially starting as early as next week, it will become clearer how the process will work out in action.
Ioanna is a writer at SHIFT. She likes the transition from old to modern, and she’s all about shifting perspectives. Ioanna is a writer at SHIFT. She likes the transition from old to modern, and she’s all about shifting perspectives.
In a world first, scientists from the University of Sussex and Universal Quantum, a spin-off of the university, have demonstrated that quantum bits (qubits) can directly transfer between quantum computer microchips.
This breakthrough is expected to overcome a major obstacle in building quantum computers that are large and powerful enough to address the crucial societal challenges they’re envisioned to: from medicine development, to the creation of new materials and climate change solutions.
To address these issues, experts estimate that millions of qubits are required — a number currently out of reach, with existing quantum computers operating on the 100-qubit scale.
“As quantum computers grow, we will eventually be constrained by the size of the microchip, which limits the number of quantum bits such a chip can accommodate,” Winfried Hensinger, Professor of Quantum Technologies at the University of Sussex and Chief Scientist and co-founder at Universal Quantum explained.
As a solution, the research team developed a novel technique, named “UQ Connect.” This method enabled the researchers to use electric field links that allow qubits to move from one quantum computing microchip module to another with record-breaking speed and accuracy. Specifically, the researchers were successful in transporting 2,424 ion qubits per second with a 99.999993% success rate.
“We knew a modular approach was key to make quantum computers powerful enough to solve step-changing industry problems. In demonstrating that we can connect two quantum computing chips — a bit like a jigsaw puzzle — and, crucially, that it works so well, we unlock the potential to scale up by connecting hundreds, or even thousands of quantum computing microchips,” Hensinger added.
Universal Quantum, which was recently named one of the 2022 Institute of Physics winners in the Business Startup category, has now been awarded €67 million from the German Aerospace Center (DLR) to build two quantum computers that will deploy the new technology.
“The DLR contract was likely one of the largest government quantum computing contracts ever handed out to a single company. This is a huge validation of our technology. Universal Quantum is now working hard to deploy this technology in our upcoming commercial machines,” Dr Sebastian Weidt, CEO and co-founder of Universal Quantum, and Senior Lecturer in Quantum Technologies at the University of Sussex, said.
València regularly tops rankingsof the best cities in the world, due to its stellar combo of 300-plus annual days of sun, the Med on your doorstep, and a lifestyle that values free time, exercise, and good food. But it’s not all paella and chill.
The Valèncian region’s startup scene — based mainly in its capital plus the smaller cities of Alicante and Castellón — has been revving up in recent years, and is now making its mark in everything from AI, fintech, and cybersecurity, to cleantech, healthtech, and industrial IoT.
With TNW’s first conference in València just around the corner, we rounded up a bunch of leading lights on the local tech scene who have helped to grow the ecosystem over the past decade. Our aim was to get their take on where València’s tech scene is at today, what it’s got going for it, and the challenges ahead.
“I always say that we are in adolescence,” Javier Megias, managing partner of the EMEA VC fund of Plug and Play Tech Center in València, told TNW. “This is a really important moment, where you create your beliefs and the foundations of your life.
“In the next few years everything is going to speed up quite a bit. We are at the tipping point of the change in the ecosystem, going from a regional, quite local ecosystem to something much more ambitious — and much faster.”
València by the numbers
Data shows a tech hub on the up-and-up. According to the Bankinter Foundation’s Startups Observatory, investment in València-based startups grew from €58.5m in 2021 to €73m in 2022. Ecosystem tracking platform Dealroom reports that the Valèncian region has the highest number of startups per capita in Spain.
Research by Startup Valencia found the number of registered startups in the region rose from 1,012 in 2021 to 1,212 in 2022; Dealroom, meanwhile, has an even higher estimate of over 1,500 startups.
València’s Fever recently bagged $227m (€212.6m) in a funding round — the largest amount of capital raised by a live-entertainment startup. Credit: Fever
València is still light on unicorns but can point to Flywire, the global payments enabler (now headquartered in Boston), as the first Spanish startup to go public on the Nasdaq in 2021, and live-entertainment platform Fever, which became a unicorn last year. Other noteworthy success stories include Jeff, Climate Trade, Voicemod, Sesame HR, and Sales Layer.
The investor scene skews towards local offices, with notable names including Draper B1, Angels Capital, private angel investor network BiGBAN, Demium, and GoHub Ventures, as well as Global Omnium, the world’s fourth-largest water utility. US-based Plug and Play also invests in Valèncian startups, including Climate Trade and Zeleros.
For Plug and Play’s Megias, the biggest difference between València and other startup scenes is the former’s bottom-up ecosystem.
“It was really built and connected by the founders,” he said. “We are really good at creating efficient companies from the ground up and scaling them to, let’s say, Series A — but we have a challenge to really scale that to the next level and build really big companies, like Flywire, for example.”
Megais cofounded two startups before joining Plug and Play.
More than 30% of all startups in València are two-years old or younger. Almost 30% of all the startups there are pre-seed, and another 30% are seed stage. Just under 10% of them have received Series A funding. Fewer than 1% have secured Series B financing, and the same goes for Series C.
“València’s international community is growing.
Megias says València is becoming a magnet for expats. The reasonable cost of living and the pleasant, manageable city are big attractions, but there are also more international jobs becoming available. Megias’ team, which looks after the EMEA region from central València, is made up of 30 different nationalities, all of whom speak English at work.
“There’s an international community that’s growing because of big companies, like Plug and Play, coming here and attracting them,” said Megias, a cofounder of Startup Valencia, a non-profit that promotes local startups.
One of the key areas for startups in the region is La Marina, which also happens to be the venue for TNW València. The accelerator Lanzadera, TNW’s strategic partner, pioneered the development of a tech strip on the seafront.
Founded in 2013 by Joan Roig, the billionaire owner of the Mercadona supermarket chain, the complex is now home to the EMEA business school, Lanzadera itself and its scaleup space Angels, the Insomnia accelerator, Biohub, and Sesame. Lanzadera, which works under the umbrella of the Marina de Empresas entrepreneurial hub, has accelerated over 1,000 startups so far, and recently took in its first batch of over 100 from Portugal.
This year, another building on the tech strip will open its doors: La Terminal startup hub. The site will provide startups and scaleups with a physical space to interact with each other, corporates, and investors.
La Terminal will become a new international tech hub for the Valèncian entrepreneurial ecosystem.
Connected for good
The speed of change in València is something that Bianca Dragomir, TNW València advisor and CEO of Avaesen, has witnessed first hand. Her pioneering cleantech cluster in the region is made up of 300 public and private stakeholders, 160 of which are companies in renewable energy, water cycle-and-waste management, and smart cities. Since Dragomir took over what was the first cleantech cluster in Spain in 2013, the organisation has accelerated more than 400 startups.
“When you come here, you get connected immediately.
“València is a very dynamic ecosystem, very diverse, and there are many different industrial sectors that are emerging, and traditional sectors that are shifting towards a new paradigm of sustainability,” Dragomir, a native of Romania, told TNW. “And the beauty of it — every single stakeholder that comes from beyond València says this — is that when you come here, you get connected immediately.”
Dragomir is the first woman that the European Commission appointed “Cluster Manager of the Year.”
According to Dragomir, the interconnected nature of the city really boosted the cleantech sector, as startups, corporates, the local government, and eight universities drove intense collaboration and innovation.
“‘Tech for good’ is very appropriate to describe what’s happening, and what has been happening for years already here… it’s a very good differentiation point,” she added.
Attracting the big bucks
Juan Vicén Balaguer, the co-founder and CMO of Zeleros Hyperloop and an advisor to TNW València, feels that the region’s youth brings advantages.
The Zeleros hyperloop is based on all-electric pods that power themselves. Credit: Zeleros
Vicén notes that while the Valèncian ecosystem is young compared to the likes of Paris and Berlin, it has a “freshness” that encourages an open exchange of knowledge and experience between startups.
“Something I think the entrepreneurship ecosystem in València has done well is basically taking advantage of the space [in the whole tech marina area],” he said. When investors come, they often get a tour of all the accelerators and incubators along the Marina.
Attracting large-scale investment, however, remains a challenge. “As of today, if you are thinking of València, you are not coming here to get investment, you are coming here because you find it a good place to start with low rates [for renting office space],” said Vicén.
“We are very good at entrepreneurs bringing new ideas to life but when it comes to investment, there is a gap. That is different in big financial hubs, like London or Paris, where you are in the capital city in the country, and it makes it much easier to do business.”
Vicén led Zeleros to the “Top Startup” prize at València Startup Awards.
Investment is also, of course, essential to attract the best talent — and Spain is not known for high salaries. According to Statista’s 2021 data on average full-time salaries in Europe, Spain is in 18th place in the continent. The Zeleros founders, says Vicén, have been “really transparent” with investors about the need to offer salaries that are compeitive with those in Northern European countries.
“Once we have those second-time founders, everything is going to be much faster.
Plug and Play’s Megias agrees, noting that companies in València need to “step up their game” on the salary front, but to do so they must connect with top investors in Europe. As is the case in many European ecosystems, the second generation of founders and employees, who stay and either invest or found new startups, will be essential to the maturation of València’s tech sector.
“Once we have those second-time founders that already have the connections, everything is going to be much, much faster,” said Megias.
From an outside observer’s view, one thing that needs to change is establishing English as a company language in scaleups, which would open up opportunities for international talent and investors. Zeleros, the Plug and Play Tech Center, and a few other organisations already do this. But in general, there is not a huge amount of English spoken here as a matter of course, and not all startups have an English version of their websites.
Nonetheless, the ecosystem has a bright future ahead.
Accelerating growth
Nacho Mas, the CEO of Startup València, predicts that the Valèncian community will become one of the top 10 tech hubs worldwide.
“Despite being smaller than Madrid, we are experiencing faster growth… and we still have room for more,” Mas told TNW.
“All members of our community are working towards a common goal, which gives us a significant advantage,” he added.
Mas says La Terminal will house more than 500 highly qualified jobs.
Mas noted that the La Terminal project in the Marina, where TNW València will take place, is expected to help attract further investment, talent, and projects into the ecosystem.
“We are ambitious because we have the potential and resources to achieve success,” he said.
Whether or not it end ups as a top 10 global tech hub remains to be seen, but València is definitely powering through its adolescence. If it can attract big investment going forward, the region’s startup sector looks set to explode.
If you want to experience València’s ecosystem for yourself, we’ve got something special for our loyal readers. Use the promo code TNWVAL30 and get a 30% discount on your conference business pass for TNW València.