Bringing disruptive innovations based on significant scientific progress to the market is a challenging process, not least when it comes to obtaining funds. As a response, the European Innovation Council (EIC) has been created as Europe’s flagship innovation programme for identifying, developing and scaling up breakthrough technologies and game-changing innovations. The EIC Info and Networking Day organised by Luxinnovation on 23 April 2024 offered valuable insights into two of the EIC’s instruments: the EIC Pathfinder and the EIC Accelerator.
EIC Pathfinder: Bringing excellent technologies into society
The EIC is part of Horizon Europe, the EU’s main funding programme for research and innovation. “The aim of the EIC Pathfinder is to boost innovation and bring excellent technologies into society, said Timo Hallantie, in charge of the EIC Pathfinder at the European Commission. “We want it to be the programme where discoveries and breakthroughs take place and where innovators come together to find and develop synergies.”
The EIC Pathfinder supports the exploration of bold ideas for radically new technologies with the potential to have a substantial impact on society. “We are looking for very ambitious, high-risk projects with a scientific possibility of a breakthrough that will lead to disruption,” Mr Hallantie pointed out. The scheme offers grants of up to €4 million, covering 100% of eligible costs. It also offers training opportunities on topics such as entrepreneurship and intellectual property rights as a way of accelerating business.
You have to sell your dream and show on paper that it is possible to achieve it.
The programme is highly competitive and Francisco Melo, Advisor – European R&D and Innovation Support at Luxinnovation and the National Contact Point for the EIC in Luxembourg, asked two former awardees about the must-haves of a successful EIC Pathfinder proposal. “Your vision!” emphasised Philip Dale, Full Professor in Physics at the University of Luxembourg. “You have to sell your dream and show on paper that it is possible to achieve it.” César Pascual, Lead Research Associate at the Luxembourg Institute of Science and Technology (LIST), underlined that “your technology has to be truly disruptive and have a big impact on something that is really useful for people”.
EIC Accelerator: Funding the scaling up of high-impact innovations
The second programme highlighted at the event was the EIC Accelerator, which offers funding to scale up deeptech, game-changing innovations that are capable of creating new markets or disrupting existing ones. “Our target group is startups and SMEs whose deeptech innovations require significant funding over a long time period and which are too risky for private investors to go for on their own,” explained Veronica Beneitez, Policy Officer at the European Commission.
The EIC Accelerator offers blended finance, combining grants of up to €2.5 million with equity investments ranging from €500,000 to €15 million. “The EIC Fund, which provides the equity part of the funding, is basically a deeptech venture capital fund,” said Giuseppe Lombardi, Head of the EIC Investment Services Unit at the European Investment Bank. “However, the main difference compared to other VCs is that the potential impact of the innovation is more important to us than the financial return. We co-invest with qualified lead investors and provide a maximum of 50% of a funding round.”
Thanks to the EIC application process, Arspectra became a much better company.
Just like for the Pathfinder, the competition for funding is fierce, and it is very unusual for a company to obtain funding as a result of its first application. “We failed twice, but kept resubmitting our application. In the end, we were successful,” said Cédric Spaas, General Manager of healthtech startup Arspectra which is one of the three Luxembourg companies that have so far obtained EIC Accelerator funding.
However, although the process was far from easy, he was quick to point out the benefits for his company. “The EIC Accelerator funding helped us bridge one of the riskiest stages in our development involving clinical trials of our solution. Once that phase has been completed, you have a much more solid basis for attracting other investors. In addition, the questions we had to face during the application process will be asked by any VC investor or other source of funding. Thanks to the EIC application process, Arspectra became a much better company.”
A jury member’s best advice
Larissa Best, Independent Director at Advent International and former EIC Accelerator jury member, shared her best advice for succeeding with the interview that is an essential part of the selection process for EIC Accelerator funding. “The most important thing is to be prepared,” she underlined. “The jury is always composed of members with different specialities – marketing, sales, financing and so on – and our job is to pick out the projects that makes most sense among a high number of very qualified applicants. The questions we will ask will be based on the data we have received through the applications, so make sure that you fully master all the details that you have included.”
Stay calm and cool and don’t try to bluff your way out of a tricky situation.
The attitude of the applicants also plays a role. “Stay calm and cool and don’t try to bluff your way out of a tricky situation – we will quickly see through it,” she said. “Just remain confident and come with what you have. This makes it possible for us to make recommendations, and questions don’t necessarily mean that you are ruled out for funding.”