Why the Netherlands needs Early Stage Investor Relief (ESIR)
- laurielancee
- Nov 14
- 4 min read
Introduction
The Netherlands celebrates innovation.
We take pride in our research institutes, creative founders and global startups. Yet, when it comes to supporting the people who make this innovation possible: the early stage investors who take the first risk; our policy still falls short.
While other European countries have introduced targeted tax incentives to stimulate early-stage investment, the Netherlands remains one of the few without a fiscal framework that recognises this essential role.
If we want to stay competitive as a European innovation hub, we need to make early-stage investing more attractive, accessible and inclusive.
The Case for fiscal incentives
Angel investors are often the first to believe in new ideas. They back founders long before venture capital arrives, providing not only capital but also mentoring, expertise and networks. Yet, in the Netherlands, these private investors do so with zero tax relief and one hundred percent of the risk.
Meanwhile, the evidence abroad is clear:
In the United Kingdom, the Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) have channelled more than £34 billion into early-stage companies since launch.
In France, the IR-PME mechanism offers income tax relief of up to 25 percent, leading to a 40 percent increase in early-stage investment in its first year after expansion.
In Belgium, the Tax Shelter provides 30–45 percent deductions for investors, generating over 2,000 angel deals annually.
Each of these countries has shown that a well-designed fiscal incentive mobilises private capital and stimulates both regional growth and diversity among investors.
Where the Netherlands Stands
Currently, the Netherlands offers very limited fiscal support for early-stage investment.
The Business Angel Seed Regulation, introduced by RVO, focuses mainly on co-investment funds and does not provide direct tax incentives to individual investors.
While the programme has supported several funds, its minimum investment threshold is high, its process complex, and it primarily benefits institutional investors rather than first-time angels.
As a result, individuals who want to back a young, impact-driven founder face the full financial risk, unlike peers in the UK, France or Belgium.
This lack of incentive leads to:
fewer private investors entering the market
lower diversity among investors
early-stage founders struggling to raise pre-seed rounds
slower scaling compared to neighbouring countries
A proposal: Early Stage Investor Relief (ESIR)
To strengthen the foundation of our startup ecosystem, the Netherlands needs its own version of a modern investment incentive: Early Stage Investor Relief (ESIR).
ESIR would:
Offer tax relief on personal investments in certified early-stage or impact-driven startups.
Recognise both financial and non-financial contributions such as mentoring or governance support.
Lower barriers for new investors, including women, young professionals and sector experts entering angel investing for the first time.
Align with EU frameworks, ensuring compliance and cross-border compatibility.
This policy would not only increase access to early capital but also diversify who invests and who gets funded.
The economic and social impact
Fiscal incentives for investors are not a cost; they are a catalyst.
In the UK, every £1 of tax relief has generated between £4 and £6 of private investment (Startup Coalition, 2024).
France, Belgium and Spain report similar multipliers.
Beyond the numbers, these policies have visible social effects:
More diverse investors: The share of female angels in the UK and France grew significantly after these schemes were introduced.
Regional inclusion: Capital flows decentralised from major cities to regional clusters, supporting innovation beyond capitals.
Higher survival rates: Startups backed through SEIS or EIS show up to 30 percent higher three-year survival rates compared to unsupported peers.
These are the results of policy that rewards courage.
Why now?
The Dutch innovation ecosystem stands at a crossroads.
We have world-class talent, a thriving tech and impact community, and an economy that depends on continuous innovation. But early-stage funding remains one of our weakest links.
By introducing ESIR, the Netherlands would:
attract new private capital into early-stage ventures
encourage more women and diverse investors to participate
strengthen the bridge between universities, startups and scaleups
align national policy with European best practice
This is not about copying another country’s model, but about creating a Dutch version that reflects our collaborative, impact-driven economy.
Conclusion
Innovation starts with courage: from both founders and the investors who believe in them first. It is time for the Netherlands to reward that courage.
With Early Stage Investor Relief (ESIR), we can make early-stage investing fairer, smarter and more inclusive, empowering more people to fuel the next generation of Dutch innovation.
References
HM Revenue & Customs (2025). Enterprise Investment Scheme and Seed Enterprise Investment Scheme Statistics 2025.
Enterprise Investment Scheme Association (2025). Facts and Figures.
Startup Coalition (2024). The UK’s Modern Industrial Strategy.
France Angels (2025). Annual Report on Business Angel Activity in France.
Bpifrance (2024). Impact des dispositifs IR PME sur l’investissement privé en early stage.
FOD Economie België (2024). Evaluatie van de Tax Shelter regeling.
OECD STIP Database (2024). Tax relief to angel investors.
European Tax Observatory (2024). Overview of innovation-related fiscal incentives in the EU.
Join the Movement
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If you believe early-stage investors deserve recognition, join us.
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