EC Says Tech Funding Is ‘Missing In Action’

The European Commission has said that funding for innovative tech businesses in Europe is still woefully behind the US and needs to be improved.

In a speech this week at the European Parliament organised by the European Young Innovators Forum, EC digital commissioner for the digital agenda Neelie Kroes said that urgent action had to be taken to make it easier for young business people to find funding.

“Facing a fragmented venture capital market and risk-averse public procurement policies means that finance is often ‘missing in action’ when you need it,” she said.

€10 billion a year

Despite pointing out the lack of financing for start-ups, Kroes said that some funding was available from the commission. Kroes expalined that the EC already invests about €10 billion a year in research and development and innovation, with about €2 billion going to ICT-related work.

But finance was only one of the barriers for setting up tech start-ups in Europe identified by Kroes. She also identified fear of taking risks as another key problem for European start-ups.

“This is the biggest barrier,” she said. “Did you know that twice as many Europeans as Americans and Chinese are afraid of failure in business? Isn’t that just incredible? We need to be less risk-averse and think big. ICT is a global business and its global success that should be our scope.”

Red Tape

Bureaucracy is also a continuing problem for small and large organisations alike according to Kroes. “Red tape is not part of the recipe for your future success. Getting involved in government funding has to be worth the effort,” she said.

The EC said it is working hard to remove the barriers to innovation in Europe. “Commissioner Máire Geoghegan-Quinn and I have set the objective of removing these barriers. We want to build up the environment for innovation and entrepreneurship,” she said. “Please guide us in this work; and let’s make this about doing rather than talking and talking amongst ourselves.”