Five EU Member States have just signed the European Tech Champions Initiative mandate and committed a total of €3.75bn. The fund is expected to invest in late-stage European VC funds of over €1bn.
A cornerstone of the Pan-European Scale-Up Initiative, the European Tech Champions Initiative (ETCI) is currently made up of the EIB Group, Spain, Germany, France, Italy and Belgium. The new fund will be managed by the European Investment Fund and will invest in 10-15 late-stage VC funds, especially those participating in rounds of over €50m.
The goal of this initiative is to maintain a more continuous flow of funding for European scale-ups and support local innovation and entrepreneurship. Compared to other continents, Europe has been trailing behind in supporting its scale-ups and helping them compete on a global scale.
Indeed, according to the EIB, from 2021 until May 2022, more than 280 European startups raised megarounds above €100m, but over 60% of these came from non-European investors. The ETCI aims to close this scale-up gap.
“Europe has strong innovators, but it needs to improve the environment for companies to transition from startup to credible competitors and market leaders. ETCI highlights our commitment to financing innovation and the rollout of technologies that will help secure a sustainable future for Europe,” commented EIB Group President Werner Hoyer.
The European Investment Fund has already secured €1bn each from Spain, Germany and France, as well as €150m from Italy, €100m from Belgium and €500m from the EIB Group, totalling €3.75bn. Seeing as 15 other member states have joined the Scale-Up Initiative, the size of the fund is only expected to grow.
While Luxembourg announced its commitment to the initiative earlier last year, it is unclear whether this will include a financial commitment to the fund in the near future or not.
