The newly hired Work program 2023 of the European Innovation Council (EIC) will award €1.6 billion in funding to scientists and innovators who can scale breakthrough technologies and create new markets.

In particular, 70% of this amount (€ 1.13 billion) is reserved for the EIC acceleratorthat supports start-ups and SMEs in developing and marketing impactful innovations.

Specifically, €525 million will be made available for start-ups developing future technologies that will contribute to the EU’s strategic objectives. These include biomarkers for cancer, decontamination for pandemic management, energy storage, quantum or semiconductor components, resilient agriculture, space technology and the New European Bauhaus initiative.

The remaining €613 million will be related to innovations without a specific topic requirement.

EIC’s work program for the coming year has three more key objectives: to increase the flow of talent to deep tech startups, to further support female innovators and to facilitate collaboration between private and public procurers.

Financing the EIC is an important but small step

To date, EIC’s support has produced some impressive results. First, the portfolio of companies has reached a combined value of more than €40 billion, including 12 unicorns and 112 centaurs.

The European Innovation Council has also managed to boost more than €10 billion in follow-on investment from the private sector. Add another €100 million in support for the commercialization of groundbreaking ideas. And we can expect next year’s funding to result in even greater momentum from the European technology industry.

But while €1.13 billion seems like a huge amount, in reality it is nowhere near enough. As a reference reference: private investment in deep tech companies in the UK reached $8.5 billion in 2021 alone — taking into account the exponential growth of the industry.

And if we – in a hypothetical scenario – split the funding from the EIC equally among the bloc’s 27 members, each country would actually end up with about €42 million of that €1.13 billion. Combine that with the slowdown experienced by the European technology industry in 2022and it is clear that public investment is an integral part of securing innovation.

Ultimately, Europe has a high concentration of technology companies, a skilled workforce and the infrastructure required to become a tech powerhouse, but it is hampered in some ways by a lack of adequate support.

Both the EU and local governments need to further fund emerging tech startups if the continent is to compete with the leading players in China and the US.