"Europe is open for innovation"

The independent High-Level Group of Innovators published its recommendations this month on the European Innovation Council (EIC), indicating it should support breakthrough innovation for the benefit of all, meeting the needs of high potential innovators from across the EU from start-up to scale-up.

In their first set of recommendations, entitled “Europe is open for innovation”, the Group (including successful innovators, entrepreneurs and venture capitalists from across the EU), also recommend bringing all relevant EU funding schemes into a single, fit-for-purpose ‘one-stop-shop’ for innovation financing, with major reforms to introduce excellence, flexibility and agility (for example to combine grant financing with venture capital investments).

Carlos Moedas, Commissioner for Research, Science and Innovation said: “This first set of key recommendations is a substantial contribution to the current debate on a future European Innovation Council. They come at a critical time in the preparations for the next EU programme and provide very clear views on what is needed for Europe to lead on breakthrough innovation.”

Among the top recommendations, the experts focus on

1. Bringing all relevant EU innovation financing into a single, fit for purpose, EIC by cutting down the multitude of existing EU schemes into a significantly simplified set of impact-driven EIC Awards addressing different needs of innovation-driven entrepreneurs from:

   ✓ proof of concept (feasibility of breakthrough ideas);

   ✓ acceleration (demonstration of commercial viability);

   ✓ scale-up (co-investing for market introduction and expansion).

   The Awards should include different forms of funding – grants, finance (debt and equity), including in combination (blending) – and taking into account different types of innovators at different stages (e.g. start-ups vs established SMEs/Midcaps; digital vs deep-tech; etc.). It is also recommended to design all EIC websites, application forms, etc. focusing on the needs of the innovators and minimise administrative and financial reporting.

2. Empowering the innovator by bringing in leading innovative entrepreneurs, universities, research organisations, venture capitalists and other investors (Business Angels, banks, etc.) and corporates in an EIC strategic advisory board. This could be done by introducing a prestigious EIC fellowship to recognise Europe’s leading innovators and pairing up EIC-awarded innovators with experienced peers and help them build a “camp” of supportive investors and “mentors/peers”.
3. Focusing on excellence even if high risk and crowding in private investors by designing evaluation and selection of EIC Awards in ways that promote excellence, enable risk taking and align interests with private investors; the group also recommends basing award decisions on face to face interviews involving funders and allowing flexibility to stop or change EIC Awards. The EIC should focus grants and other high risk-finance on innovators commercialising breakthrough products based on science, research and development, where there are most significant market gaps for private financing and largest positive externalities. To do so it should continue to improve overall access to innovation finance (incentivising private funds into venture capital (including support to deep-tech VC Funds-of-Funds), risk-sharing guarantees with banks and financial intermediaries, etc.).

Full text: http://ec.europa.eu/research/eic/pdf/eic_recommendations_set-1_2017.pdf