European Innovation Council: Making Science Fiction Reality
“The ambitions of the EU Green Deal: climate neutrality, circular models, and the Chemicals Strategy for Sustainability, are huge. The only solution to achieve these ambitions is innovation. Sometimes we can develop solutions within our companies, but sometimes we need to look outside our boundaries to innovate. Start-ups could be an answer” says Pierre Barthelemy, Cefic’s Innovation Executive Director, at a Cefic workshop to introduce the European Innovation Council (EIC) and how the chemical industry can benefit, on 29 April 2021. “The European Innovation Council can help us connect to the world of start-ups”, he continued.
The European Commission launched the fully-fledged European Innovation Council (EIC) in March 2021. This funding programme has a budget of over €10 billion for 2021-2027 to develop and expand breakthrough innovations. The EIC builds on a successful pilot programme under Horizon 2020, which supported around 6000 small and medium-sized businesses (SMEs) and start-ups, as well as over 330 research projects with a budget of €3.5 billion. “This is the first time a programme is dedicated to disruptive technologies” saysKeith Sequeira, EIC Head of the Governance and Coordination Unit, “It combines visionary research on emerging technologies with an accelerator programme to scale up innovative start-ups and SMEs”.
Several Cefic members have already launched a successful collaboration with the EIC and the corporate days. According to Lucresse Van Wonterghem, leading on Open Innovation – Connect and Develop at P&G, “Successful pilots equals true business, thus continued business. We do not just run pilots, we incorporate the technology within our company so that the startups can grow together with us. If we have good success with pilots, we strive to grow that success. If not for the EIC enabling the multi-company approach, P&G on its own would not have had identified particular start-ups and innovative SMEs.”
Jens Busse, Investment Manager at Evonik Venture Capital, participated in Evonik’s EIC corporate days in 2019 and 2020, on Healthcare and on Sustainability and Circular Economy, respectively. “A close discussion between start-ups and representatives from Evonik was a good opportunity for these companies to present their products and get firsthand feedback from the industry. From our side, we could get in contact with a good selection of start-ups, which resulted in some ongoing collaborations and potential future investments”.
What does success look like?
The Corporate Days organized by EIC offer an opportunity for the start-ups and SMEs to sign deals with corporations. For corporations looking to invest, this initiative offer access to research results of radically new technologies, prototypes, and the most promising start ups, SMEs already financed by the EIC, which enhances the quality of the technology offers for the corporations. Therefore, if an organisation decides to invest, the financial risk would be shared with the EIC. According to Manuel Mendigutía, EIC Strategy Advisor and Programme Coordinator, “our average success rate is 26%. 1 in 4 EIC beneficiaries selected for a Corporate Day signed a follow up deal in less than six months with a Corporate although the gain from the startup-Corporate collaboration goes far beyond for all sides involved in the programme”. The investments would ultimately help Europe’s recovery from the economic crisis and accelerate the transition to a green and digital economy, answering challenges related to the European Green Deal.
How does it work?
Financial support is provided through three main instruments, the “EIC Pathfinder” for advanced research on breakthrough/game-changing technologies, “EIC Transition” for transforming research results into innovation opportunities and the “EIC Accelerator” for individual SMEs/Sartups/Scaleups to develop and scaleup breakthrough innovations with high risk.
A key novelty in Horizon Europe is the “EIC Fund”, a unique entity owned by the European Commission and established to make direct equity investments in companies selected for the EIC Accelerator from €0.5m to €15m. The EIC Fund aims to crowd in other investors, further sharing risks by building a large network of capital providers and strategic partners including CVCs suitable for co-investments.
The programme is open to all industries, but only ideas to radically change technologies will be selected. An example from the chemical industry includes a sustainable “chemical factory of the future”, CLASSY, through the development of a new self-regulating chemical reactor that will result in close to zero waste streams, under Horizon 2020.
To speed up innovations, the EIC does not just provide financing. The EIC Business Accelerator Services helps scale up the technology readiness and growth of highly innovativecompanies by providing access to advice (mentors and coaches), to business partners (Corporate Partnership Programme, Procurers days pitches to investors) and to international trade fairs (Oversees Trade Fairs) all under the a tailor-made platform, the EIC Community. A whole package of partnerships is offered to scale up. “It allows projects to mature from lab results to a credible alternative for investment” says Viorel Peca, EIC Head of Unit of Transition and Business Acceleration Services.
The Future of chemistry requires the chemical industry to accelerate chemical innovations. The European Innovation Council offers a market opportunity to turn the most innovative ideas into commercial technologies.
The envisaged next step to get even more benefits from the collaboration between the chemical industry and the EIC’s ecosystem is a multi-corporate day around sustainable chemicals along the value chains.