Dutch: Not Loving Risks Much?


Failure is known to be an essential part of the progress and innovation, and risk loving behaviors are strongly associated with disruptive entrepreneurship. While the Netherlands is a home to many incubators, tech hubs, and startups, risk-averse mentality, and a stable life keep the Netherlands away from becoming one of the major startups’ hubs in the world.

Following an Agenda vs Accepting Risks 

If we look at The Netherlands, the number of self-employed people has more than doubled in the past 10 years, going from 500.000 to over a million. The trend has increased in comparison to the past. However, compared to the other countries, Holland prefers “to keep it safe” in many of the aspects. Low unemployment rates, “living by agenda”, planning things ahead with no interruptions, and having a healthy work-life balance while earning enough to have a comfortable life are the aspects that make the Netherlands very attractive for living. However, risk aversion among people seems to be quite high.

A lot of young people in The Netherlands have some “side hustles” – startups and projects alongside their full-time jobs. However many of them do not want to dedicate time to their passions completely as the prospect of not having enough stability scares them away. The economy in the Netherlands is stable to the point that having a full-time job with all its perks outweighs the uncertainty of entrepreneurial life. Upon graduation, many young people prefer to be employed by a company with a decent entry salary and do not choose entrepreneurship as a path.

Conquering Benelux vs Conquering the Whole World

If we look at existing Dutch startups, their main goal is “to conquer Benelux” while in the US for example, entrepreneurial ambition is “to conquer the whole world”. Same way, Dutch investors try to keep it safe and rarely invest in high-risk high-profit projects. Apart from a couple of Dutch unicorns, most of the startups would be described as “socially innovative, stable and benefiting the local economy“ instead of “disruptive and game-changing”. While there is nothing wrong with developing a locally-beneficial startup and bearing the risks in mind, the overall risk aversion in the society might make more risk-loving Dutch entrepreneurs want to leave The Netherlands and develop their ideas elsewhere.

Perception of Financial Risks 

Based on the research and the data from ING International Survey on Savings, people living in the Netherlands, Austria, and Germany consider investments in shares, mutual funds, and bonds on average extremely risky whilst their expected returns are very low. In contrast, those in the US, Turkey, UK, and Australia tend to have the exact opposite belief, that is, investing in financial assets can be highly beneficial, with a risk below the mean of all other countries.

Same way, many Dutch companies tend to consider previous “failures” as a negative factor when employing people. “After Michiel Frackers Internet company Bitmagic failed in the Netherlands, US-based companies offered him a number of attractive positions (like the position of Managing Director Europe at Google), but Dutch companies preferred to stay away. In the States the reaction was… Good! Now you have got a little blood on the nose… Everyone says that you learn more from your failures than from your successes. However, it seems that in the Netherlands that was not the case”.

While Dutch companies tend to have less competitive environment in the workplace than US-based ones, risk-taking behaviors and failures on average are more tolerated and accepted in the US.

Failure is an Option by The Institute of Brilliant Failures

Not everyone needs to be entrepreneur. However accepting failure as a learning process and educating young people about entrepreneurship and business are the things that can foster innovation. One of the great examples of Dutch initiative towards this is the Institute of Brilliant Failures founded back in 2015 by Paul Iske – Chief Dialogues Officer at ABN AMRO Bank. The foundation aims to promote an environment of entrepreneurship by learning to deal with risks and the evaluation of mistakes. The platform encourages people to share their failures, and help them learn from mistakes with a set of tools. The institute has gained extensive experience in creating more ‘fault tolerance’ and a more healthy innovation climate in complex environments.

Proactive Flexibility 

At any point of your life, your job application might get turned down, you might miss your bus stop, or end up missing a flight, you can get fired or your business can fail, and your relationships might not work out. The idea of failing is quite hard to embrace, but in many moments in life, it’s experimenting and failing that brings up innovation and serve as the driving force of the progress.  In times of increased life complexity and pace, everyone needs to be able to adjust to the occurring shifts in the economic and political structure. And entrepreneurs need to be even more ahead. “Proactive flexible” mentality is what allows people to act ahead of time, predict the next trends, make a fast decision and be able to adapt fast to any changes with the minimum time loses.