Description of the core change(s) brought by this policy instrument
The EIC is intended to help small businesses commercialize their products by providing a mix of grants and equity. It is currently in pilot mode and is awarding grants. In the future, it plans to make equity investments.
Please list the implementing agencies
EIC is part is part of the Horizon Europe research program.
If you marked "start-up" and/or "scale-up" firms, please provide the specific definitions used
The EIC pilot supports ideas from any area of technology or business sector, including novel combinations of technologies and business models. Support is available from feasibility to development to scale-up stages.
EIC pilot support is available to innovators from all EU Member States, countries associated to the EU Horizon 2020 programme, and to innovators from all parts of the world who establish their activities in Europe.
Abstract summary of this Policy resource
The EIC pilot final two year phase (2019-2020) includes over €2 billion in funding covering the innovation chain:
- ‘Pathfinder’ projects to support creating novel breakthrough technologies from the research base.
- A first set of programme managers with leading expertise in a number of future and emerging technology areas provide practical support for projects funded by the Pathfinder.
- ‘Accelerator’ funding to support startups and SMEs develop and scale up innovations to the stage where they can attract private investment. Under ‘accelerator’ funding companies will be able to access blended financing (grants and equity) of up to €15 million.
In 2017, the Commission launched the first pilot phase of the European Innovation Council. Since then, 2,078 highly innovative projects have received funding totalling over €893 million. Building on this, an enhanced EIC pilot phase was launched in March 2019.
To support the various pilot activities and to prepare the future EIC, the Commission appointed on 27 June 2019 the first ‘EIC Pilot Advisory Board’, bringing together 22 innovation leaders. The board oversees the EIC pilot, prepares the future EIC, and champions the EIC globally. Members were selected following an open call for expressions of interest, which resulted in over 600 applications.
Challenges, criticisms and lessons
Since the European Commission has no direct experience in venture capital, there is a mixture of optimism and concern with regards to the EIC's intent to start its equity program. One worry is that while public investment in small tech companies can help get new products to market, it can also crowd-out private investment. See more, here.
Notes and additional context
The EIC supports a European Green Deal. "Europe needs to capitalise on its science, innovative SMEs and start-ups to compete in global markets increasingly defined by new technologies. That is why the European Commission has introduced a European Innovation Council (EIC) to support high-risk, high-impact ideas, turning science into new business and accelerating the scale-up of ’game-changing’ innovators shaping the future" (Why the EIC?).