EU increasing investment in deep tech
European deep tech research and start-ups will be supported by €1.4 billion next year via the European Innovation Council, the EU Commission has announced. The decision comes after former EU central bank leader Mario Draghi in a report stressed the need for investments to secure EU growth. The Commission itself, in a recent analysis said that EU’s tech development is too slow and not on track to achieve the digital objectives and targets for 2030 set in the Digital Policy Programme.
The now adopted EIC Work Programme 2025 includes an increase of nearly €200 million in comparison with 2024, according to the Commission.
Draghi, author of a report on European competitiveness requested by the President of the European Commission, said that the EU needs to focus on three crucial issues: closing the innovation gap with the US and China; developing a joint plan to link the goal of decarbonisation with increased competitiveness; and boosting Europe’s security and reducing its dependence on foreign economic powers.
The Commission in its earlier analysis said that additional European investments are needed especially for digital skills, high-quality connectivity, uptake of AI, semiconductor production and start-up ecosystems.
The Commission now says that the 2025 programme In addition to a bigger budget, means better access to scale-up equity funding with the EIC Strategic Technologies for Europe Platform (STEP) scale-up scheme.
The 2024 programme:
- New EIC STEP Scale-up scheme, which will work with a budget of €300 million in 2025 (and expected to grow to €900 million over the period 2025-27) to provide larger investments in companies aiming to bring strategic technologies to the EU market and avoid strategic dependencies. It will provide investments of between €10 and €30 million through the EIC Fund per company to leverage private co-investment, achieving at least €50 to €150 million in total.
- According to the Commission, the EIC STEP Scale-up scheme will help address a market gap in deep tech scale-up funding in Europe, targeting digital technologies, clean and resource-efficient technologies including net-zero, and biotechnologies.
- €120 million for emerging technologies including autonomous robots, climate resilient crops, converting waste to input materials and medical diagnosis.
- €250 million for earlier stage companies in specific target technologies including generative artificial intelligence, new space, agri tech and future mobility solutions.
- Increasing access to Business Acceleration Services for emerging companies from ‘widening countries’ (countries with lower levels of research and innovation performance).
- Awarding of Seals of Excellence under the Transition and Accelerator calls and the new STEP Seal under the STEP Scale-up scheme and Accelerator Challenge calls: these Seals aim to facilitate access to complementary and alternative funding sources such as Cohesion Policy Funds as well as to EIC Business Acceleration Services.
The EIC Work Programme 2025 has three main funding schemes:
- EIC Pathfinder – €262 million for multi-disciplinary research teams to undertake visionary early-stage technology research and development with the potential to lead to technology breakthroughs (grants up to €4 million).
- EIC Transition – €98 million to turn research results into innovation opportunities, following up on results generated by EIC Pathfinder, European Research Council Proof of Concept and Horizon Europe Pillar 2 (societal challenges) collaborative projects (grants up to €2.5 million).
- EIC Accelerator – €634 million for start-ups and SMEs to develop, commercialise and scale up innovations with the potential to create new markets or disrupt existing ones (grants below €2.5 million, investments from €500 000 to €10 million).
“In addition, the EIC Strategic Technologies for Europe Platform (STEP) Scale-up scheme – €300 million – will provide additional equity funding to promising companies driving innovation in critical areas (SMEs, start-ups, spin-offs and small mid-caps) to help them secure larger private co-investment for further scaling their businesses (investments from €10 to €30 million).”
The European Innovation Council is not new. It was launched in March 2021. It has a budget of over €10 billion between 2021-2027.
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