EIC's deep tech scaling up drive has raised €527 million in the last year

EIC's bid to match European deep tech scale ups with more external funding, through its "crowd-in" model, is off to a good start.
EIC's deep tech scaling up drive has raised €527 million in the last year

The European Innovation Council revealed today that its shortlist for European deep tech scale ups, the ScalingUp TOP50, accrued €527 million in new funding over the past 12 months.

It means TOP50 startups have now raised €1.8 billion to date (including funding that presumably precedes the programme's inception.)

EIC formed ScalingUp TOP50 some 12 months ago. The scale ups were selected by specialised investors tasked with finding Europe's most likely deep tech unicorns.

The programme was formed with a view to applying the EIC's crowd-in funding model to high-potential European deep tech startups.

Given that European funding generally lags the US, the crowd-in model helps Europe's scale-ups close the gap by pairing EIC funds with external investment in each TOP50 fundraise.

EIC says the model has proven fruitful having so far produced an 9x investment multiple, with its internal fund having invested around €190 million.

Within the 50 startup selections, some 35 companies also elected to access EIC "Growth Club" services. These are provided by 30 expert mentors and an extensive partnership roster  - including BpiFrance and BCG, focusing on growth strategies and visibility.

Tech.eu learned from project partner TechTour that a further seven startups did not have the time to join Growth Club, while seven non-EU portfolio companies (from the UK and Israel) were ineligible.

IQM, Lightyear and Smart Photonics

Some 60% of the money raised by TOP50 startups last year went to just three companies: quantum hardware startup IQM, solar-powered EV developer Lightyear, and photonic chip foundry Smart Photonics.

Of the Top50's 10 biggest funding rounds, around half were led by government-led funds. EIC said this shows "the importance of long-term investment to deep tech scale-ups."

There are now 386 separate shareholders in the portfolio companies, up 38% on last year.

More takeaways were apparent sector-by-sector.

On average, digital-led startups in the portfolio raised €49.6 million, twice as much as health-led businesses and 50% above sustainability tech.

EIC has also expanded its knowledge base for the ScalingUp TOP50 programme following interviews with startups and their investors.

The interviews revealed four key themes in terms of scaling up challenges specific to Europe. These were: financing and finding lead investors, recruiting a director's board including independent non-executives, developing an investment narrative/business strategy, and navigating the EU's institutional complexities.

Follow the developments in the technology world. What would you like us to deliver to you?
Your subscription registration has been successfully created.