ETCI: more funds to European tech champions

Five EU Member States and the European Investment Bank Group have signed the European Tech Champions Initiative (ETCI) mandate, a Fund of Funds that will channel much-needed late-stage growth capital to promising European innovators. Europe’s tech startups, EIB says, often do not have sufficient capital to compete on a global scale and are pushed to relocate overseas. Closing this "scaleup gap" could, ideally, create a large number of highly skilled jobs and boost growth.

ETCI is considered the cornerstone of the Pan-European Scale Up Initiative, which was unveiled in February 2022 in Paris during a summit organized under the French Presidency of the Council of the EU. It will pool public resources from participating Member States and the EIB Group to make significant investments into large-scale Venture Capital funds, which will in turn provide growth financing to European tech champions.

The new fund should improve financing availability, "especially for companies seeking to raise amounts of over 50 million euros", EIB says. It will create "an asset class for European institutional investors to diversify their portfolios", maintaining a continuous flow of funding to European scaleups. A positive self-sustained dynamic in the European high-tech landscape that "will nurture home-grown innovation and entrepreneurship".

Managed by the European Investment Fund, ETCI has secured commitments from Spain (1 billion euros), Germany (1 billion), France (1 billion), Italy (150 million) and Belgium (100 million) during the initial subscription period. The EIB Group has deployed additional 500 million euros, thus bringing the grand total to 3.75 billion euros. The size of the fund is expected to grow further with future commitments.

“Offering support to Europe’s innovative firms in their late-stage development, when they want to scale up their business, is essential for safeguarding the EU’s strategic autonomy,” EIB Group President Werner Hoyer said. “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.”