Venture Capital/News/

EU deeptech fund speeds up investments but many startups still left waiting for funding

The European Investment Council (EIC) Fund has finalised equity agreements with two new startups and taken a positive decision about 33 others — but many companies are still waiting for their money

By Zosia Wanat

The EU is slowly moving forward with reviving its stalled investment scheme for European deeptech startups, announcing that the recent restructuring of the European Innovation Council (EIC) Fund — the equity investment arm of the EIC —  has led to the finalisation of two new equity investments and an acceleration of it decision-making processes about other startups. 

Regardless of the progress, dozens of other companies selected for equity investment are still waiting for their money. 

The fund has today announced investment agreements with Apix Analytics, a company working on the first miniaturised universal gas analyser, and Lattice Medical, which works on breast self-reconstruction with patients’ own tissue, both from France. 

It also said it had made positive investment decisions about 33 other startups — deals that haven’t been signed off yet. All of these transactions, when finalised, will amount to equity investments of around €190m. 

Overcoming roadblocks

The fund has been offering grants, blended finance and equity investments to Europe’s deeptech startups since 2021. It’s something it sees as essential for reaching so-called “technological sovereignty” — a push to shore up the continent’s role in cutting-edge tech like microchips, quantum computing and groundbreaking climate solutions.

But in that time dozens of companies have been mired in bureaucracy and many of the startups selected for investment under the scheme have waited months to receive funding, which has put some on the brink of bankruptcy. While the EIC has been slowly moving forward with the payments of grants, for many months it only managed to conclude one equity investment, in French microprocessor maker SiPearl, in June this year.

149 other startups that qualified for equity investments are still waiting for a decision regarding their money. The fund says it’s “fully engaged to deal with the backlog”. 

The EIC says that the new investment decisions are “a significant step forward” to make the EU’s investment scheme operational. The new investments and positive decisions come less than six weeks after the EIC changed its internal structure and appointed an external fund manager, Alter Domus, to make decisions about high-risk investments. 

The fund offers grants of up to €2.5m and equity investments of up to €15m per company, for a maximum stake of 10 to 20%. Over seven years, it wants to invest €3.5bn in around 500 to 700 deeptech companies. So far in 2022, it has been Europe’s most active deeptech investor by number of deals.

Zosia Wanat is Sifted’s central and eastern Europe reporter, soon to be based in Warsaw but currently in Brussels. She tweets from @zosiawanat.

Join the conversation

avatar
  Subscribe  
Notify of