The European Commission and the European Investment Fund (EIF) have launched a Pan-European Venture Capital Funds-of-Funds programme (VentureEU) to boost investment in innovative start-up and scale-up companies across Europe.

Access to venture capital is the key to innovation. Six funds will receive EU support for investment in the European venture capital market. Their goal will be through €410 million (from the EU) to attract public and private investment of 2.1 billion euros. The whole plan is expected to attract €6.5 billion new investments in new and growing businesses and double the current EU venture capital amount.

Venture capital funds are essential for the smooth functioning of the Capital Markets Union (CMU). However, their development in Europe needs further impuls, the European Commission said. In 2016, venture capital investments in the EU amounted to around €6.5 billion, compared to €39.4 billion in the US.

The EU will provide cornerstone investments of up to €410 million – including €67 million of EIF own resources: €200 million from the Horizon 2020 InnovFin Equity, €105 million from COSME (Europe’s programme for small and medium-sized enterprises), and €105 million from the European Fund for Strategic Investments (EFSI) – the so-called Juncker Plan.

The six funds will take stakes in a number of smaller investee funds and cover projects in at least four European countries each. These investee funds will help finance small and medium-sized enterprises (SMEs) and mid-caps from a range of sectors such as information and communication technologies (ICT), digital, life sciences, medical technologies, and resource and energy efficiency.