Today I’m pitching the European Commission for 80 Billion Euros for my startup, Europe.


europe-money_1This afternoon I’m making my way north from Paris to Brussels, the capital of the European Union and home of the European Commission. There I’ll be giving a workshop to Neelie Kroes, the very outspoken Vice President of the European Commission who has spoken about Europe’s need to build startups that stay in Europe. “Start in Europe. Stay in Europe,” she says, and for the past few months, they’ve been working to make sure that can happen. Part of the Horizon 2020 project – the EC’s Research and Innovation initiative aimed at transforming Europe – has involved inviting members of the European startup ecosystem to submit what amounted to over 100 responses filling a 250 page word document, with opinions on how Europe can better support startups. Rule out the responses that asked for personal funding, or the ones that said “Europe’s dead. Give up” and you have about 150 pages of solid feedback from journalists, CEOs of major (seriously major) startups in Europe, researchers, accelerators, incubators, journalists, and even a chime in the folks at GA. I know all this because I spent the last two months combing through that information (thanks to a recommendation from some of the guys at TheNextWeb who also worked on parts of the project) and I’m going to be presenting my results today.

I’ve never really done government work, so I had to learn a few things along the way. I thought I’d share that quickly before I share what i’ll be pitching:

  1. Money First. Legislation Later: the first draft of my report was filled with legislative changes that the EC could recommend to Member States (that’s what they call European countries, I also learned). Most of it was about aligning best practices around hiring/firing, company creation, banking regulation – you name it, I told ’em to change it – and that’s when I learned the harsh truth. In order for the EC to recommend legislative changes or even that Member States invest in certain initiatives, they have to first run a pilot program in a few markets around Europe and show the increased results – this is why they’ve set aside 80 Billion euros from 2014 to 2020 for grants to startups. That is, if “we need it,” which leads me to point #2
  2. “If you don’t want it, that’s cool” – this 80 Billion euros could just as easily go to R&D, or other industries. It depends on what startups say they need. There were responses saying “let the private sector do its job” not realizing that, well, that’s what’s happening now, and the EC can easily not give money. This doesn’t mean the money goes back to the Member States, it just means some other industry gets the money. If you ask me, if it’s between me or some other shmuck, I say give it to us.
  3. The European Commission doesn’t WANT to become a VC fund: Despite popular belief that the European Commission will start investing left & right and “picking winners,” they have very little urge to do that, or anything else that will distract from the growth of the private sector. They just want to pilot projects to test under which conditions startups can flourish most in Europe, and what Member States need to do to create a Europe where startups want to be.

So, with all that in mind, I’ve got the task of convincing the European Commission that the European tech startup ecosystem could make use of the money – I don’t know why someone who’s only been in Europe for 2 1/2 years got this job, but whatever. I also wasn’t a journalist 18 months ago.

Here’s what I’ll be telling the European Commission they should do with their 80 Billion Euros:

  1. Crowd-funding: Specifically, “providing grants to crowd-funding platforms in order to build a pan-European crowd-funding platform.” This includes incentivizing Kickstarter’s expansion across Europe, or expanding local projects like Seedrs and KissKissBankBank.
  2. Dispel Fear of Failure: Funding a marketing campaign which will encourage current employees and students to start their own business: “Bring the American Dream back to where it originated: Europe.”
  3. Web Entrepreneurship in Education: Providing grants to universities which offer courses teaching about web entrepreneurship.
  4. European Tech Tours: Funding initiatives to bring European tech startups to the Silicon Valley to meet potential clients, investors, and partners.
  5. Events Highlighting European Tech Startups: Funding initiatives which attract global web entrepreneurs, investors, executives and journalists to European hubs, such as incubators or accelerators in major European cities, to provide European tech startups with global visibility.
  6. Provide European Tech Startups access to existing Events: Funding tech startups to attend private/top-level networking events, in order to get exposure in front of high-level decision makers in the tech industry.
  7. Increasing value in existing local events: Identifying local events which attract tech startups, such as pitch camps, and provide prizes to competitions, such as tickets to bigger European events, to encourage local events to bring out the best tech startups.
  8. Increase cohesion between researchers & potential web entrepreneurial students: Funding universities which create joint-curriculum courses to allow marketing students to work with research students in order to turn research into a product and take it to market.
  9. Enable Local Accelerators/Incubators: Providing supporting grants which allow accelerators to invest more in each tech startup, as well as potentially to provide follow-on rounds to tech startups, should they go on to raise additional rounds of funding.
  10. Grants for Venture Capital Funds: Providing Grants to Venture Capital Funds to complement their investments, in order to allow them to provide more funding to European tech startups.
  11. Turn Local Leaders into Global Leaders: Providing competitive calls for companies to launch pilot projects to take their business to new markets outside of Europe.
  12. Online Platforms: Funding the creation, expansion, or availability of online platforms both for connecting the tech startup ecosystem as well as technical platforms designed to help tech startups scale up their technical infrastructure.

Government generally sucks at helping startups – just ask Techstars’ David Cohen what he thinks about government & startups – but I think the European Commission has a real unique opportunity to test new waters in how government and startups cooperate. Startups will continue to flourish in Europe no matter what governments do, so it’s not as if the European Commission will do anything to hurt the ecosystem. However, if they discover that not taxing companies in a high-growth phase increases their chance of becoming a global leader, then European countries may be interested in replicating that, in order to create more local companies that are global leaders.

So, as far as the propositions above are concerned – take ’em or leave ’em. Frankly, I’m not big on every single one of ’em, but plenty of people are, and if those people benefit from them, and go on to produce more European startups or keep cogs turning in the ecosystem, then I say power to ’em. Anything I left off the list? Feel free to share below.

7 Responses

  1. Rand Hindi

    Nice post, but I wish you would include some R&D grants for those actually creating new technologies!

    • Liam Boogar

      Haha, Trust Me. There are PLENTY of grants for that. It’s not lacking at all. On the contrary, the above grants do not exist at all, and are sorely needed. R&D Grants are available on the local ,regional, national, and European level. Definitely not going to change much by adding one more or taking one away – that will happen regardless of the above.

    • Rand Hindi

      You get tax rebates, yes, but actual money is hard to get unless you are tied to a university or research institution. And filling those grant requests is enough to discourage anyone trying to do so!

      Anyways, if we get any of the above, it would be great already

    • Alexandre Passant

      I’ve been involved in several EU FP7 proposals in the past (academic side), and that’s indeed lot of work! However, the project is generally driven by a big institution (often academic), so the work for a start-up is actually not that huge if the co-ordinator does a great job.

      Yet, when start-ups are in the proposal, it becomes more risky (what happens to the project if the startup fails, etc.) and less likely to get funded (even though it happens, for sure!).

      So one thing you could preach is to ask the EU to be more flexible when small, low/no-funded start-ups are members of proposal consortiums.

      That said, all your suggestions make sense. You could already get some of those through certain EU projects (coordination actions), but getting them w/o the burden of sending a 100 pages proposal would be a big step forward, especially if there’s a quick turnover (few weeks compared to several months).

      For point 10, that happens in Ireland, so that’s a good example they could check (cf

      Good luck with it!

  2. Gil Doukhan

    I believe one big problem in Europe is the exit. Corporations are not used/willing to pay a lot for a startup. The american dream lies in that issue too!

    Maybe there is some kind of mechanism to setup, like tax deduction, to encourage companies to pay big time for a startup.

  3. Cannes or Bust

    Different forms of crowd-funding were high on the agenda at the recent Midem music biz conference. One pundit even claimed that use of crowd-funding will become the norm for many music releases in the not too distant future. I’m not sure how to extend that to funding start-ups. But if there is 15% to be made, I’m sure someone will find a way!

  4. Alex Vandermeersch

    Two things: 1. Tax rebates – of all the money invested in my start up, 50% when back into taxes (corporates social charges & on my employees). I got back a little bit through grants, but spent a lot of time for it. Make sure that start ups that are busy innovating don’t get punished as they start by financing tax rebates on employees (most often #1 cost when starting up). Allow tax breaks for employees since they create value too & they get more pocket money at a lower cost 2. As Guy Kawasaki pointed once ‘Sales fixes everything’. There is no culture from big companies to buy from start ups in Europe, contrary to US. Then you’re stuck with no sales = no success stories = no feedback = no money = no investors. What about tax shield for companies buying products+services from start ups (think about the movie industry) ?

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