An official entity: European Innovation Council Equity Fund for high-impact innovation

24/06/2020

The EIC Fund, which will provide equity from €0.5m to €15m to breakthrough innovation companies selected for EIC Accelerator blended finance support (grant and equity), has become an official entity.

This is the first time the European Commission will make such direct equity investments in companies, with ownership stakes expected to be in general from 10% to 25% in start-up companies. The European Investment Bank, as advisors of the EIC Fund on behalf of the European Commission, will manage the ownership stakes of the European Commission.

From 2021, the EIC Fund will be financed by the EIC to be established under Horizon Europe - the EU Research and Innovation Framework Programme (2021-2027). It fills the funding gap at the start-up stage where the EU venture capital market underperforms compared to the global venture capital market. Mariya Gabriel, Commissioner for Innovation, Research, Culture, Education and Youth said:
“The EIC Fund – the first of its kind - will help our most innovative start-ups and SMEs rapidly bring their innovative products to European and global markets, while growing their companies and talent within the EU. Currently so much economic growth and jobs potential is lost because with these companies are seen as too high-risk for the private venture capital market.”

In Bavaria, companies like Irubis GmbH, Smart4Diagnostics GmbH, Advitos GmbH oder Blickfeld GmbH are currently bringing their products to the last stage of development and getting ready their commercialisation thanks to this new European blended finance model, which allow the combination of a grant with a public investment.