There’s huge potential for European deeptech to become a world leader — and, in recognition of that, investment in the market has seen a year-on-year increase, almost tripling since 2015. Yet, like most startups, deeptech companies often face difficulties scaling on a pan-European level.
“Europe is a fragmented continent, with cultural, language and market barriers. When you are a European startup, your domestic market is typically your home country,” says Chahab Nastar, chief innovation officer of EIT Digital, a leading European digital innovation and entrepreneurial education organisation, part of the European Institute of Innovation and Technology community.
“The issue is that in digital, a national European market is way too small for you to win the race on a global level.”
“A national European market is way too small for you to win the race on a global level.”
EIT Digital Challenge 2020
EIT Digital helps European tech scaleups overcome those challenges. The organisation has offices across Europe, in Amsterdam, Berlin, Braga, Budapest, Brussels, Eindhoven, Edinburgh, Helsinki, London, Madrid, Milano, Paris, Rennes, Stockholm and Trento, as well as an extension to the US in Silicon Valley. It also has access to over 300 corporate partners, including the likes of Siemens, Telefonica and Nokia.
Nastar and his team are shortly closing applications for the seventh EIT Digital Challenge, a competition looking for innovative companies with deeptech solutions. 20 scaleups will be selected to pitch in front of a jury of corporates and investors.
The five best companies will gain 12 months’ access to the EIT Digital Accelerator, which offers tailored growth support worth €50,000 from a team of business development and fundraising experts — with the first-place winner receiving a cash prize of €100,000.
The EIT Digital Challenge and Accelerator give successful candidates a rare opportunity to jump those hurdles and scale up internationally. “Leveraging EIT Digital’s extensive ecosystem, the Accelerator team members act as an extended team for companies; they break the borders by supporting companies to acquire customers and raise funds outside of their home country,” says Nastar.
In previous years, the EIT Digital Accelerator team has helped companies like METRON, a French company providing artificial intelligence algorithms to reduce energy consumption of industrial plans, raise €8m from investors like BNP Paribas and Reply to fuel further international growth and R&D.
But what do the previous Challenge winners think? We caught up with three companies who’ve been through the EIT Digital Challenge last year and are currently receiving its EIT Digital Accelerator support, to find out.
Participating in the accelerator is an opportunity to make useful connections. Dario Maccarrone, chief marketing officer of Valencia-based internet of things (IoT) provider Loriot, which was awarded second place in the challenge’s ‘Digital Cities’ category, says it was helpful to meet both other founders and potential corporate partners.
“We benefit from the value that comes from exchanging opinions and experiences with other founders. We’ve already made business connections within months which would have cost us years of business development without [EIT Digital’s] help,” he says.
Mathias Bohge is managing director of R3 Communications, a Berlin-based startup offering wireless technology for industrial applications and a winner of last year’s challenge in the ‘Digital Tech’ category. He says that these connections endure: “Even now, we’re in contact [with members of the EIT Digital Challenge jury] discussing our technology. This was something I would not have anticipated at all.”
“We’ve already made business connections within months which would have cost us years of business development without [EIT Digital’s] help.”
A sales superforce
EIT Digital’s pan-European network can help superpower startups’ sales teams, too. Markus Große Böckmann, managing director of Oculavis, a German scaleup developing remote solutions for machine manufacturers and plant operators and winner of last year’s ‘Digital Industry’ category, says EIT Digital’s team has helped to boost the company’s presence across the continent.
“Our EIT Digital contacts are located in different European countries and are sales specialists,” says Große Böckmann. “They know the needs of our network and adapt the wording and story to the target person. This is a great help in the initial contact process.”
Maccarrone adds that elements like “matchmaking activities, feedback, valuable contacts, introductions to potential partners and customers and invitations to participate in important tech events” have all driven further learnings and opportunities for Loriot.
Landing contracts and funding
Several months into the Accelerator, Oculavis is seeing its business development work start to pay off. “No direct revenues have been generated yet, but we have made some promising offers already,” says Große Böckmann.
“EIT Digital gave us considerable media exposure and strengthened Loriot’s positioning and reputation in the market.”
Having EIT Digital’s backing helps open doors, says Maccarrone — and close deals faster. “Being recognised as one of the top 10 European tech scaleups by EIT Digital gave us considerable media exposure, and strengthened Loriot’s positioning and reputation in the market.”
At one point, Loriot even made it onto a billboard in the big smoke thanks to EIT Digital: “We were very pleasantly impressed when our logo appeared on the Nasdaq screen at Times Square in New York. It was an amazing and unexpected surprise for us.”
After the Challenge, Bohge was delighted to be able to scale up R3 Communications faster than expected: “Something that I was happy about is upon winning the award — it only took a small amount of time to receive the prize money.” He adds that this is a step up from other challenges where there are longer waiting times. EIT Digital is now also helping R3 Communications raise a Series A round of funding.
Advice for others: Connect, communicate, compete
And what advice do the winners have for scaleups aspiring to follow in their footsteps and join the EIT Digital Challenge? If you want to expand, then it’s worth it, says Große Böckmann.
Maccarrone advises that when it comes to pitching to the jury, polish your presentation: “Face the stage with determination by communicating in a clear, specific and memorable way.”
Make sure to also show that your business is ready to weather tumultuous months ahead, he adds: “These are times of great turmoil, and it is crucial to demonstrate that you have a strong team and a resilient business model that can adapt quickly to the changes we all are facing.”
The EIT Digital Challenge 2020 is now open for applications. Submit your application by 7 June 23:59pm CEST for your chance to scale up to success.