The road from unconscious incompetence to great potential. VentureLab North is a business accelerator for startups and existing companies in the Northern Netherlands. Around 220 startups have gone through the program and went on to raise a total of over €26 million in investments so far. The VentureLab team - consisting of professor Aard Groen, program coordinator Aniek Ouendag and partner coordinator Cees-Jan Groen (no family by the way) discuss the value and importance of the program, as well as their ambitions to grow and expand it in the coming years.
A fantastic idea is one thing, converting this idea into a successful business requires a great deal more. Enter VentureLab North, the startup accelerator program of the University of Groningen, and originally the brainchild of NIKOS, the University of Twente’s Expertise Centre for Technology-based Entrepreneurship, co-founded by Aard Groen: “The question back in 2008 was why there were so few fast growers like Booking.com and Thuisbezorgd.nl. Research showed this had a lot to do with unaware incompetence in business of most of the high tech entrepreneurs”.
“Obviously, it is not easy to get to such unicorns”, Cees-Jan Groen adds. “It takes effort and time, but quite a few of our more recent startups, like Dropper, EV Biotech and Reducept are doing pretty good in terms of growth.”
What makes VentureLab North unique?
Cees-Jan: “Some people still think we’re a program for students, because we’re affiliated with the University of Groningen, but we’re not. About 50% of people in the program are university staff, PhD students and regular students, the other half are innovative SME’s, former managers, etcetera. I think our real strength is a combination of helping people develop entrepreneurial competencies and skills on the one hand, and help develop very early stage ideas into business cases on the other. The structure and cadence make the program unique and, unlike a lot of other accelerator programs, we don’t finance ourselves through shares or equity and we don’t have a strict policy of selection at the gate.”
Why is that so important?
Aard: “To solve the unaware-with-business issues, you have to start in this very early stage.”
Cees-Jan adds: “It’s about giving people the opportunity and the tools to grow. Most of the entrepreneurs in our program focus on high tech and high innovation, with products or services that take time to develop, are not easy to explain and the time it takes to become successful as a business is also longer. If you were to pitch this early idea to an investor, you would probably get a no. But with some training, coaching and help in finding the right market, an abstract idea can turn into a scalable product and a no can turn into a yes.”
Aniek: “And sometimes you’re not sure about an idea’s potential, but you see the glimmer in someone’s eyes. That passion, drive and ambition. And then it’s about turning unconscious incompetence, where they're unaware of how little they know, into conscious incompetence, where they become aware of their deficits and understand the importance and value of skills.”
Aard: “It helps someone to quickly learn and grow, or realize they might not be the best CEO, but they could be a great CTO, for example. After a couple of months into the program, we can usually start to see the potential in people and after a year, the majority of business cases will definitely have the potential to find investors or their launching customers, depending on the nature of the business they are in.”
What are some accomplishments you’re particularly proud of?
Aniek: “The fact we have built an ecosystem of more than 100 trainers and coaches, plus an active ‘Venturelabby family’ with alumni and current participants. We’re also very much connected to other entrepreneurship players like the Hanze Centre for Entrepreneurship, Innofest and Startup Assist of Donar, to name a few.”
Aard adds: “It is also great we have been able to create a ‘pipeline’ from education - using extra-curricular courses and Venturelab Weekends - to successful startups exiting the VentureLab program. As well as various PhDs following up their research in the VentureLab context. This all has been leading to successful startups like for example CC Diagnostics, EV Biotech, SG Papertronics and IV Medical. I’m proud of this ‘pipeline of valorisation’, from education to research to VentureLab North, as a living lab for innovation and entrepreneurship.
Cees-Jan: “During January this year we collected the results for 168 VentureLab North startups, startups which were in the program from the start in 2015 till January 2020 (so entrepreneurs who have been out of the program for at least one year or more). Collectively these startups received over €26 million in funding and generated more than 370 jobs in the region. So in terms of impact, that’s definitely something to be proud of.”
Any startups or entrepreneurs in particular you feel you’ve really helped?
Cees-Jan: “One of them would be EV Biotech. Founder Linda Dijkshoorn is a natural CEO with a strong presence. She took part in the VentureLab Weekend before she joined the program and had this biochemical process where you can engineer microorganisms to produce or poop out just about any chemical, which is far more sustainable than regular production. From a scientific point of view, that’s amazing. But from a business perspective, it’s a little too vague. You need to start somewhere specific as a proof of concept. We helped her with finding potential markets, one of them being vanilla. It’s great to see her making big steps now.”
Aniek: “Another example would be CC Diagnostics. Founder Nutte van Belzen also took part in one of our VentureLab Weekends, where we had this box of available UMCG patents that students could choose from and come up with a business around it. Nutte chose a novel cervical cancer diagnostic test, which ultimately became CC Diagnostics. And during the program and exploring the business model, he realized he was better at being a CTO. An experienced CEO came on board when venture fund Carduso decided to invest in CC Diagnostics, to help Nutte guide the company through the maze of clinical trials and certification process.”
And what about the more difficult cases?
Cees-Jan: “Usually, the more difficult cases are the people who are absolutely convinced that their idea is the greatest idea ever. That it will just sell itself and that investors will line up to offer billions, and that there’s no need to think about doing any market research or come up with a scalable business model. But, provided they are coachable and willing to learn, most of them will realize pretty soon that there’s a lot more to running a business than simply having a great idea.”
Aniek: “Something I really like is the sort of cross pollination that happens in the program. When people hit a sort of dead end with their own idea, but say ‘you know what, I’m better at the marketing part, so let me help you with that.’ It’s great to see how the entrepreneurs work together and learn from each other.”
You’re currently looking for funding to expand the program. Why change a winning formula?
Cees-Jan: “Well, for one because we realized that for most of the startups, a year is not really enough and you see them lose momentum. Which is a shame, because they could really benefit from tailored coaching to help them further along in the investment or cash-flow process. Another reason is we want to grow in more than our present market segments, and not only just here in Groningen, but in the Northern Netherlands. We’re calling it VentureWeb, expanding our value-add in the northern ecosystem.”
“And we also want to focus more on helping SMEs with their innovation plans. Let’s take hydrogen as an example, which is a big part of the energy transition specifically here in the Northern Netherlands. Say a local manufacturer or service provider wants to innovate and be part of that transition, we would like to be able to help them too. With our coaching network for example, but also being able to offer a tailored, light-version of the program or any of the scientific tools we’ve developed. Aside from the funding we’re currently looking for, we’re already working with different organizations on our plans, both in Groningen, Friesland and Drenthe.”
Ideally, what will the next couple of years look like?
Aard: “Hopefully, we’ll be able to create more impact in supporting the northern innovation ecosystem, with our program, our tools and our network. Ideally, we can build a solid, well connected foundation, where innovation, impactful scientific research and entrepreneurs with big ideas find capital and each other, and to further grow together as a region.”
Cees-Jan: “It would be a dream to open the Washington Post in for example five years from now and read an article on page 3 about how the Northern Netherlands is outperforming Silicon Valley in terms of innovation. Let’s make this happen, start with sharing your business idea with us at www.venturelabnorth.com.”