We asked Oost NL, Farmforte &
Willicroft: Why the Netherlands?
For the 3rd “Art of Scaling: Real Conversations” webinar, we dived into the topic of why innovative companies around the world select the Netherlands as a scaling destination. Today we bring you the highlights of that conversation, which you can rewatch here. To explore that topic, we invited two leaders of ventures who successfully expanded to the Dutch market, as well as a representative from a regional local partner:
Why the Netherlands?
To open the discussion, Hilco summarized the answer to the question “Why the Netherlands?”:
- It is an agrifood powerhouse, as the second largest exporter of food products in the world
- It’s home to leading entrepreneurial and academic research centers, including Wageningen, the best food and agriculture university worldwide
- You’ll find an ideal mix of multinational companies, research institutes, small and medium-sized enterprises (SMEs), food producers and startups;
- The workforce is highly educated and multilingual
- Excellent infrastructure connections to Europe and the rest of the world, from high-speed trains that will take you to all major cities in Europe, to a dense network of highways, to some of the most important ports in the world (Rotterdam and Amsterdam).
It is clear why the Dutch market is attractive on paper, but as one speaker asked during the webinar: “Is it really that easy?”. And the answer is, of course, no. Going international is a lot of hard work, as the teams of Willicroft and Farmforte will tell you. Let’s see what their leaders have to say about their first-hand experience:
How did you make the decision to go international?
Brad: We started our business in the Netherlands. A big attraction was the access to a pool of similar markets, since consumer preferences are quite homogeneous between the Netherlands, Scandinavia and Germany. The market is also the perfect size to test products; and more – local consumers are “hard to win over”, so if you convince them, you can be more confident in taking on further markets. The quality of the infrastructure was a big selection criteria – nobody does infrastructure like the Netherlands.
Charles: We started in Nigeria with an international aspiration from day 1. We built the business in a way that would allow us to serve international markets. That mindset prepared us for what was ahead. We’re farmers, and focused on building up the value chain in our early years. After we got our farming infrastructure right, we started getting our products out and tried to access international markets. The Netherlands was a perfect match.
The Farmforte team at Fruit Logistica 2020, in Berlin
How did you select a local partner?
Charles: We spent a lot of time in the Netherlands. We started building our network by attending several events, which put us on the map in Europe. We wanted to find a partner that could bring knowledge and experience to the team, particularly in the specific challenges of food & agriculture. Participating in the ScaleUpFood program was very useful for us. It opened our eyes to really understand the market, and know what it takes to scale a company.
Brad: There is no need to reinvent the wheel when you can rely on partners that already have the experience. If we had done the production process in-house, for example, we would have spent a fortune. We found outsourcing partners to handle our production and distribution processes, which allowed us to focus on what we excel at – creating winning recipes, communicating our impact, and optimizing our marketing efforts.
What cultural differences did you encounter?
Brad: When we were looking for a partner it was important to us that communication was efficient. We’re a very transparent team, and the fact that the Dutch are “straight talkers” saved us a lot of time. In England we tend to tiptoe around issues, so no one knows where they stand. In the Netherlands you do, for better or for worse.
Hilco, laughing: At Oost NL, as a partner, we’re very straightforward. Sometimes even too direct, for some cultures.
Charles: The directness of Dutch people helps things move fast, and speed is essential in doing business. We also found that local people share an exploratory nature. The Netherlands has historically shown a willingness to go into the unknown, taking risks. There’s a lot of uncertainty in scaling, so that attitude can come in handy. It helped that our team enrolled in education programs in the Netherlands. That gave us room to experience the culture, the people, and see for ourselves what the possibilities are. Oost NL and ScaleUpNation, for example, offer great programs that allow you to spend time on the ground in the Netherlands.
The Willicroft team in front of the Amsterdam store
Were there any major border restrictions that affected your expansion?
Charles: We didn’t have many problems, since we work with international distribution providers. In Nigeria there are constraints and inefficiencies in the chain, but with experience you fine-tune your logistics. Moving products across borders definitely gets easier with experience.
Brad: We mostly had issues with the UK and Switzerland. It was a hassle to take care of the exports ourselves, so we found local partners for both those markets. You give up some margin, but it’s worth it, especially when you’re starting.
How did you fulfil quality requirements for the Dutch market?
Charles: The quality standards in Europe are very high. You have to go through certain certifications, there are no shortcuts. What we tried to do was to localize in the Netherlands – find a local partner that could join us and bring the experience and the industry network that we didn’t. Then we started building a Dutch team, which enabled us to navigate the market.
Question from the audience
How can start-ups build processes that can be scaled up?
Charles: In terms of scaling, I wouldn’t say it’s a straight line. Many consider it an art. A lot of times we think that the process starts from the inside, but our business was shaped from the outside, by the demand. After you find and align with it, then everything begins to add up – which people you need to hire, your finance needs, etc. In 2017 we were under 10 people, now we’re over 900. The real magic is: how do you crack the code of generating demand for your business? After that everything falls into place.
Where do you get relevant information to help you in the scaling process?
Brad: We’re part of some really active communities that provide us with support – The Kitchen Republic or Impact Hub, for example. I also subscribe to some newsletters, like Food Hack, and listen to a lot of podcasts. “Investing in Regenerative Ag” is a really good one. We also get industry reports from Digital Food Lab.
Charles: ScaleUpNation! You have a ton of information that I constantly check. I also get materials from THNK and Foodvalley.
These were just some of the highlights of an exciting conversation about expanding to the Netherlands. One thing is clear – it is not easy, but it can can be done. Especially with a partner on the ground.
On November 1st we are launching a program for international food & agri ventures that want to expand to the Netherlands. Over the course of 4 days in Wageningen, we will host five teams to kickstart their business in the Dutch market. We still have a couple of spots left. Are you interested? Get in touch with Liliana at liliana.moreva@scaleupnation.com or apply directly 👇
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