The EIC Fund will require €7 billion over the next seven-year budget period to provide larger investments to scale up strategic technologies
EIC board president Michiel Scheffer. Photo credits: European Commission
The European Innovation Council (EIC) needs a budget at least four times larger under FP10, the EIC board said in a statement on Tuesday. The money would go towards bringing success rates to an “acceptable” level of around 15% in the upcoming research Framework Programme, up from a current level of between 3% and 5%.
The board’s position paper comes only days after EU research commissioner Ekaterina Zaharieva told MEPs that the European Commission should at least double – if not triple – the EIC’s budget in a bid to help it finance more projects.
As the Commission is planning to announce a proposal for the next EU multiannual budget on July 16, EU research and innovation funders are fighting for bigger money pots and more autonomy.
The European Research Council (ERC) has also entered the budget race. Last month, in a letter to Commission president Ursula von der Leyen and research commissioner Ekaterina Zaharieva, the ERC scientific council said that the EU’s fundamental research fund should become independent from the Commission, with a stable long-term budget.
The EIC, which was launched to help start-ups and SMEs scale up breakthrough technologies and innovations, has a budget of €10 billion out of the nearly €14 billion allocated to the third pillar of Horizon Europe over the 2021-2027 period. This represents less than 15% of the total funding for the Framework Programme for research and innovation.
According to Zaharieva, her team is working on a proposal to provide the EIC with the appropriate budget.
In its series of recommendations, the EIC board also said that the EIC’s venture investment arm, the EIC Fund, should expand to provide early-stage investment but also follow-on and growth financing for deep-tech start-ups and SMEs.
Under the EIC Strategic Technologies for Europe Platform 2025 call, the EIC Fund plans to provide up to €30 million to support rounds above €100 million for the scale-ups. But in the next budget period, which will run from 2028 to 2034, the EIC Fund would require a minimum of €7 billion to provide larger investments to scale up strategic technologies and help close the innovation gap with the United States and China.
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Meanwhile, the proposed Scaleup Europe Fund, which the Commission intends to deploy together with private investors to allow direct equity investments in strategic sectors like artificial intelligence and quantum technologies, is expected to provide “additional firepower to catalyse even larger rounds,” the board said, calling for a budget of €3 to €5 billion to draw in institutional investors, including pension funds and insurance companies.
The EIC also pointed out that US agencies such as DARPA and other ARPA programmes had a combined annual budget of about $6 billion, which is around four times higher than the EU funding agency. “Matching the US levels of investment in disruptive early-stage innovation only would require at least €5 billion a year,” the board said.
Other recommendations include adopting a challenge model inspired by the US Advanced Research Projects Agencies, making processes more agile and innovator friendly, building synergies with European, national and regional initiatives and embracing experimentation.
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