The European Commission today published an independentreportdetailing the gaps in EU support for the European venture capitalist (VC) ecosystem, which may inform the work of the start-up funding programme, the European Innovation Council (EIC), on track to becoming one of the biggest VCs in Europe.

The report evaluated the effectiveness of different EU programmes supporting the venture market, such as InnovFin Equity and VentureEU, finding that while they follow a clear intention to develop the VCecosystem, growth has been modest and the market remains significantly smaller than in the US and China.

To help VCs take full advantage of the services, the report recommends streamlining the application process for EU support programmes, lowering administrative burden to make the programmes easier to administer, and supporting the creation of large later-stage pan-European equity funds, which would be able to fund bigger companies that often find support easier in the US and China. The report also suggests the EU should allow its programmes to take higher risks when investing to better achieve its policy priorities and crowd in private investors.

Yet, EU support cannot plug all the holes. Growth takes time and the development of risk capital markets often depends on a number of policies at national level, which is beyond the scope of the evaluated EU programmes, according to the report.

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HORIZON BLOG: Research and innovation in the new seven-year budget - Science Business