EU Commission boosts funding to retain start-ups in Europe

The European Commission has unveiled a new strategy aimed at empowering small tech start-ups as part of the broader Choose Europe initiative, designed to enhance competitiveness against giants like China and the US.

This comprehensive document outlines essential actions to facilitate the establishment and growth of companies within the EU, which includes improving access to funding and resources while streamlining administrative processes.

Currently, Europe hosts around 8% of start-ups globally. A recent report by former Italian Prime Minister Mario Draghi highlighted that a staggering 61% of global funding for AI companies is funneled into US firms, 17% to Chinese enterprises, and a mere 6% to those in the EU.

To bridge this funding gap, a public-private partnership fund will be introduced at the start of next year to encourage start-ups to scale their operations effectively.

“Capital is crucial, and Europe has it. We need to align it with the needs of our innovators,” stated European Commissioner Ekaterina Zaharieva during the strategy’s launch. She emphasized the persistent funding gap and the need for collaboration with private investors to tackle significant challenges and minimize market fragmentation.

Simplification of Processes

The Commission aims to streamline the process of starting a business, allowing creation within 24 hours and establishing a unifying business regime across the 27 EU member states.

Additionally, the proposal seeks to alleviate the financial toll incurred from unsuccessful start-up ventures by addressing insolvency challenges.

“With 30,000 early-stage start-ups in Europe, we’re brimming with ideas—we just need a solid plan to maximize their potential,” Zaharieva remarked.