Nearly 1,000 Dutch entrepreneurs received over €300M as Corona Bridging Loan to stay afloat during the pandemic: Report

COVID-19 has affected the startup ecosystem globally, causing substantial job losses, difficulties in raising funds, and much more. During this time, numerous Dutch tech companies were battling with making sense of where to turn to for assistance.

As a result, the COL (Corona Bridging Loan) program was made available by the Ministry of Economic Affairs and Climate Policy on April 29th, 2020, providing €300M for bridge funding through the ROMs. 

The COL programme ran from late April 2020 until July 1, 2021. Nearly 1,000 entrepreneurs received a COL loan, providing support during the corona period. 

Recently, Corona Bridging Loan’s final report was presented to Minister Stef Blok of Economic Affairs and Climate. Rinke Zonneveld (chairman ROM Netherlands & director InnovationQuarter) and Maurice van Tilburg (Techleap.nl) explained the report to the minister.

“Innovation is the backbone of our future earning capacity,” says Minister Stef Blok of Economic Affairs and Climate. “The corona outbreak, a pandemic of unprecedented proportions, was an acute threat to almost all entrepreneurs. We have been able to help many of them with the various support schemes. The bridging loan offered a solution for start-ups, scale-ups, and innovative SMEs. Thanks to the COL, we have been able to retain almost 1,000 companies, all with great potential because they play or will play a role in the energy transition, digitisation or sustainability, for example.”

Here’re the six key takeaways:

Reviewed 2276 applications

From COL’s inception on the 29th April 2020 to the 1st July 2021, around 2276 applications have been reviewed. The total amount of requested funding is over €840 million.

Of these, 974 applications were approved for a value of almost €300M. Including co-financing by existing shareholders and third parties, a total of €331M was invested in the innovative business community.

Supports innovative business community

The COL has mainly supported the innovative business community in the Netherlands like Medtech, CleanTech & Energy, Hightech systems, Agritech & Food, and Soft-tech. These sectors took up 86 per cent of all applications. 

The top 3 sector with the highest approval rates are:

• Life Sciences – 56 per cent 
• Cleantech & Energy – 54 per cent 
• Hightech – 53 per cent  

€50K and €250K category

Almost 75 per cent of the companies have applied for a loan between €50K and €250K category, with a median of €240K, to bridge a 9-month period.

According to the findings, around 58 per cent (1330) of the applicants were startups, and 22 per cent (505) were scale-ups.

Approval and refusal

According to the report, 43 per cent of the applications have been approved, for a total of almost €289M. This is supplemented with co-financing by existing shareholders for applications over €250K.

On the other hand, 57 per cent of applications have been denied, mostly because of insufficient confidence in repayment (32 per cent) and/or relating to the COVID-19 crisis (26 per cent). 

Financing need 

As per the report, a scaleup requested about €364K more compared to startups. In total, the expected structural need after 9 months is €1.7B, up by 24 per cent compared to August 2020. 

Breakdown per ROM

Over half of the 2276 applications are done at ROMs in Noord-Holland and Zuid-Holland. 

The report says ROMs (Regional Development Companies) Zeeland and Flevoland have the highest approval percentages. The average approved application amount varies from €370K for Zuid-Holland to €206K for Utrecht. 

So far, Noord-Holland committed the most capital, almost €80M. Zeeland the least with less than €5M.

“We have not yet started to repay our COL loan,” said Fited CEO Erdem Ay. Fited uses smartphone photos to 3D print scoliosis braces. “We are now seeking additional funding so that we can continue our clinical work.” 

Rinke Zonneveld (chairman ROM-Nederland & director InnovationQuarter) and Maurice van Tilburg (Managing Director Techleap.nl) indicate that they will continue to monitor the companies closely. 

“Our work does not stop here. We monitor whether the companies that have received a COL are also successful in the follow-up phase. Much of the market is reopening, but high-risk sectors with high capital needs – important for our economy – are still struggling to attract funding.”