The European Commission and the European Investment Fund (EIF) have launched the pan-European Venture Capital Funds-of-Funds programme (VentureEU) to boost investment in start-ups and scale-up companies across Europe.
The Commission and the EIF have announced six participating funds under the scheme backed by EU funding to the tune of €410m, with the target of raising up to €2.1bn of public and private investment. “In turn, this is expected to trigger an estimated €6.5bn of new investment in innovative start-up and scale-up companies across Europe,” said the Commission.
Commission vice-president Jyrki Katainen (pictured), responsible for jobs, growth, investment and competitiveness, said: "In venture capital, size matters. With VentureEU, Europe's many innovative entrepreneurs will soon get the investment they need to innovate and grow into global success stories. This means more jobs and growth in Europe."
Pier Luigi Gilibert, chief executive of the EIF, added: "VentureEU is an important addition to the European equity scene. Whilst we have supported more than 500 funds to date, this is the first time that the EU has created such a unique programme.”
In 2016, said the Commission, venture capitalists invested about €6.5bn in the EU compared to €39.4bn in the US. Moreover, it said, VC funds in Europe are too small – €56m on average compared to €156m in the US. As a result, new companies are moving to other regional ecosystems where they have better chances to grow fast, the Commission said.
The number of compnies reaching the "unicorn" status of more than a $1bn market valuation at the end of 2017 was 26 in the EU, compared to 109 in the US and 59 in China.
With VentureEU, around 1,500 start-ups and scale-ups are expected to gain access to the fund across the EU. Companies involved ICT, digital, life sciences, medical technologies and resource and energy efficiency are expected to benefit.