€1.4bn boost for European company innovation
The European Innovation Council (EIC) is set to see a restructuring and budget increase to boost support for startups, particularly for scaling up operations for technology companies.
The move is proposed at part of the 10th EU Framework Programme for Research and Innovation (FP10) by the European Commission and includes a standalone innovation pillar based on the US ARPA programme.
The US ARPA innovation agency holds almost a mythical position in innovation, being seen as a key reason for the strength of the country in technology over the last fifty years, evolving into the Defense variant DARPA in 1972. The UK government has also been trying to mimic ARPA with its ARIA agency.
However, the board of the EIC has identified areas need further clarification, including what the ARPA-like approach to be implemented through the EIC Challenges actually means, as well as the role and operation of the Transition instrument. It is also calling for increased cooperation with the European Research Council to spin out take research ito startups that can scale up quickly, as well as defining the role of EIC in defence and dual use technologies.
In addition, the EIC Board is also calling for profits from the equity investments to be reused as follow on funding. The EIC has been taking stakes in startups such as Fractile in the UK, which is also backed by the NATO Innovation Fund.
The board of the EIC called for an expansion of the operations back in March to cover the entirety of the innovator’s journey with a suitable budget
“We therefore strongly welcome the Commission’s proposal for the EIC under FP10 which not only retains but strongly reinforces the integrity of the European innovators journey with a standalone innovation pillar centred around the EIC,” said the board.
This includes a 3.5x increase in budget to meet the demand for support across all its programmes.
Other critical elements in the proposal include the endorsement of a more ambitious Challenge model with an enhanced role for the EIC Programme Managers to develop and implement these EIC Challenges aligned with policy priorities.
The Commission’s proposal for the EIC Fund also contains important provisions to enable follow-on funding and for a Fund structure that can attract other public or private investors, key elements to scale finance and companies here in Europe.
Finally, welcome that the EIC will continue to have an independent work programme as it is essential to be able to set priorities independently and operate effectively in support of the innovator’s journey from research until scale-up. We were also pleased to see that the role of an independent EIC Board is retained as the EIC must draw on the knowledge and expertise of
For the final cut off for this year, the EIC received 1211 full applications from start-ups and SMEs for the EIC Accelerator, making it the highest ever number of submissions since the launch of the EIC. All together, they requested €8.875 billion of funds with 74%, or 898 companies, looking at grants combined with equity investments. This highlights the challenge of driving innovation across Europe. The applicants come from 35 different countries (including 13 of the latest countries joining the EU, with the highest number of participants coming from Germany, Israel, and France.
The most recent deal was an investment in RAAAM Memory Technologies with a $17.5M Series A funding round, The company, based in Israel and Switzerland, is developing memory for AI chips that is a drop in replacement for SRAM with half the area and 10% of the power.
The round was led by NXP Semiconductors along with the EIC Fund and Silicon Catalyst Ventures, which also runs an accelerator programme in the UK.
The funds will be used for full qualification of RAAAM’s patented gain cell RAM (GCRAM) on-chip memory technology which has already been demonstrated its GCRAM technology on silicon of leading foundries and has announced a close collaboration with NXP.
“This oversubscribed funding round with high-profile strategic and financial investors is another sign of confidence in our company and our revolutionary technology,” said Robert Giterman, CEO and co-founder of RAAAM. “Our solution promises to resolve the memory bottleneck in leading edge AI chips through significant memory density improvement and lower power consumption compared to SRAM.”
“Strengthening Europe’s leadership in strategic technologies is central to our mission at the EIC Fund,” said Svetoslava Georgieva, Chair of the EIC Fund Board. “RAAAM’s breakthrough in on-chip memory directly addresses a critical challenge in the semiconductor value chain. We are happy to support their path from proven prototypes to market-ready solutions.”
Last month the EIC invested in Dracula Technologies in France for the first time as part of an extended €30m round to scale up its inkjet printed solar cell technology. It is quadrupling its roll-to-roll production capacity with industrial partnerships to add additional manufacturing capacity closer to key markets.
However, one of the key recommendations which is not evident in the Commission’s proposal concerns the recovery of the investments to the EIC Fund: Revenues or amounts resulting from exits should be reusable by the EIC Fund to ensure that it can provide essential follow-on funding.
The EIC Challenge programme needs to have a clear process to provide the programme managers with the freedom to define Challenges and implement these with the necessary flexibility in support of the innovators journey from research to scale-up. This requires an understanding of the interactions with the European Competitiveness Fund and operation of the Transition programme, which should become the key agile interface to accelerate the flow of ideas from research to innovation for Union and nationally funded programmes.
The EIC is calling for programme managers to fast-track high impact ideas without requiring formal calls. While this would tackle the issue of bureaucracy, it also needs to have due consideration for transparency and accountability.
The €634M budget is split in Open and Challenge calls. The Open call budget is the larger of the two at €414m, broken down as €165m for the Grant component and €249m for the Equity component.
The Challenge call budget is €220m, with €88m for the Grant component and €132m for the Equity component.
Alongside the new fast track, the new proposals will introduce a technology expert evaluator and evaluation panels, which will address the issues of a lack of domain knowledge slowing down the evaluation process. The application will also have three interview-weeks for the face-to-face interviews and a shorter full-proposal.
If you enjoyed this article, you will like the following ones: don't miss them by subscribing to :
