After the festive opening of the EIT Digital satellite co-location at CWI (Centrum Wiskunde & Informatica), we interviewed Prof. Willem Jonker, CEO at EIT Digital. During this conversation, we talked to Jonker about his view on the European scaleup ecosystem. “When a scaleup fails, it’s generally because of a lack of expertise.”
What’s the difference between a startup and a scaleup?
Jonker: “A scaleup wants to be an international player with a significant turnover, within a relatively small amount of time from the get-go. To be honest, I am more interested in companies who go for a significant turnover than the companies who go for a significant valuation. Startups, however, start really small and tend to focus a lot on the technology. A lot of the startups disappear, as they focus on a technology and eventually find that it is hard to scale it. You need big technology and a good sense of how desirable your technology really is. In other words, there has to be a market. Still, a lot of scaleups will fail. And that’s okay, but it shouldn’t happen because of obvious problems that you didn’t account for. Every scaleup once was a startup, but not every startup will become a scaleup.”
What are the biggest hurdles for scaleups to becoming successful?
Jonker: “A lot of people think that throwing enough money into a project will make it successful. However, I think that money isn’t the most important factor. When a scaleup fails, it’s generally because of a lack of expertise on how to systematically scale up in Europe. Another complexity is how fragmented the market in Europe is. To grow, European scaleups have to cross borders relatively quickly, since the home market is too small.”
“Third, you really need to understand the business. It’s true that you need to understand the technology, but the business part is just as vital. In Europe, you can identify two schools: the ones who understand technology and the ones who understand business. However, you need people who understand both parts. That’s why we put so much energy into training and education. Without education, no innovation can take place. You need to educate, train, and build the expertise for scaling up.”