Starting a business in any country can be an exciting, but daunting, undertaking. Choosing the right location will be critical to your company’s success, but your decision will be based on a few factors.
If a European destination is your ideal location, the Netherlands and Switzerland are both top contenders. They both appeal to entrepreneurs for a variety of reasons but factors such as their currencies, languages and cost of living differ significantly.
Comparing the two side-by-side will give you a better idea of what life and owning a business would be like in each one.
How Startup-Friendly Are The Netherlands And Switzerland?
Both countries are conducive environments for startups, but for slightly different sectors.
Businesses in fintech, health tech and sustainability thrive in the Netherlands, particularly in Amsterdam. The government offers plenty of support for new entrepreneurs through their Startup Visa program and a few funding opportunities. The country boasts a strong digital infrastructure with a strong English-speaking workforce, which is always a drawcard for foreigners.
On the other hand, Switzerland is home to plenty of startups in the biotechnology and pharmaceuticals sectors. There are funding initiatives available through both the government and private investors. However, the cost of living is more expensive and the country’s immigration policies are stringent, which could pose some challenges for foreign entrepreneurs.
Currency
Netherlands: The currency used here is the Euro (EUR) which is used across the rest of Europe. If you plan on conducting business within the European Union, this is quite an advantage as you won’t need to deal with any currency exchanges.
Switzerland: In Switzerland, the currency used is the Swiss Franc (CHF). It is fairly stable, but is completely separate from the Euro. This means that you will need to work with currency exchanges if you plan on conducting business activities outside of Switzerland.
Taxes
Netherlands: As of 2024, the corporate tax rate is set at 19% for companies who have an annual profit of 2o0,000 Euros. Exceeding that, the tax rate is 25.8%. There are a few tax incentives for startups which includes some tax deductions, and the VAT is at 21% for most of the goods and services.
Switzerland: In Switzerland, the corporate tax varies from 11% to 21% while VAT is at 7.7%. These are significantly lower than the Netherlands’ and is an attractive option for larger businesses or those who intend on operating internationally.
Cost Of Living
Netherlands: The cost of living here is relatively high, compared to other European countries especially in main cities like Amsterdam and Rotterdam. You may often find that there is often a shortage of rental properties available, which can be tricky to navigate if you plan on moving there.
Switzerland: Switzerland is one of the most expensive countries in the world to live in. Everyday expenses, along with housing and healthcare, are much higher but so is the quality of life.
Work Culture
Netherlands: The Dutch emphasise a strong work-life balance, and you will find that English is widely spoken. This makes it much easier for foreigners who aren’t fluent in Dutch but still want to conduct business there.
Switzerland: Work culture will differ from region to region as there are either German, French or Italian influences in each one. The Swiss work environment is more formal than in the Netherlands, and the Swiss appreciate both punctuality and precision in a business setting.
Language
Netherlands: Dutch is the official language of the Netherlands, but most can speak English fluently. It’s not uncommon for businesses to interact in English especially in the urban areas.
Switzerland: Switzerland actually has four official languages which are German, French, Italian and Romansh depending on which area you are in. They do speak English professionally, but not as widespread as in the Netherlands so being able to speak at least one of these languages would be beneficial.
How To Set Up A Business In The Netherlands And Switzerland
Netherlands: The country has a fairly quick and streamlined process. All you need to do is register your business with the Dutch Chamber of Commerce and receive your VAT number. This process can usually be done online and involves very little paperwork.
Switzerland: To set up your business in Switzerland, you will need to register with the Commercial Register and get your corporate identification number. The duration and ease of the process will again depend on which region you are in.
Where Should You Start Your Business?
Both the Netherlands and Switzerland are strong choices for foreign entrepreneurs looking to start a business, but for different reasons.
The Netherlands is more affordable and accessible, especially if you plan on targeting the European market. On the other hand, Switzerland boasts low taxes with a high-quality of living.
The one you choose will largely depend on what your priorities are, as an individual and a business.
