More venture capital for startups and doing away with the stigma of entrepreneurial failure: the EU wants to support entrepreneurs to get back on their feet quicker.
On Tuesday the Commission unveiled the Start-up and Scale-up Initiative that aims to give Europe's many innovative entrepreneurs every opportunity to become world leading companies. It pulls together all the possibilities that the EU already offers and adds a new focus on venture capital investment, insolvency law and taxation.
Commissioner Elżbieta Bieńkowska, responsible for Internal Market, Industry, Entrepreneurship and SMEs, said: “Today start-ups do not fully take advantage of the opportunities of the Single Market. Starting and scaling up a company across Europe has to become simpler. Europe needs to become the first choice place for great business ideas to grow into successful companies. This is about new jobs, innovation and competitiveness for Europe."
Commission proposes new approach to business insolvency in Europe: promoting early restructuring to support growth and protect jobs
Well-functioning insolvency and restructuring systems are key to supporting economic growth and job creation. This initiative will increase the opportunities for companies in financial difficulties to restructure early on so as to prevent bankruptcy and avoid laying off staff. It will ensure that entrepreneurs get a second chance at doing business after a bankruptcy. It will also lead to more effective and efficient insolvency procedures throughout the EU.
The Initiative brings together a range of existing and new actions to create a more coherent framework to allow start-ups to grow and do business across Europe.
The Initiative also puts emphasis on helping navigate regulatory requirements, improving innovation support through reforms to Horizon 2020, and fostering ecosystems where start-ups can connect with potential partners such as investors, business partners, universities and research centres. Changes to Horizon 2020 will pave the way towards a European Innovation Council and include using €1.6bn over 2018-2020 to provide bottom-up support for breakthrough innovation projects by start-ups with potential to grow.
The announcement was met with mixed response
Jeroen De Wit, chief executive of Teamleader, a Belgian startup for customer relations management, said there were too many initiatives around Europe and few of them useful.
Jeroen De Wit acknowledges that while finance is important to startups, access to talent is becoming a growing problem across the EU. "We have over a million startups in Europe,” said De Wit, who is from Ghent with a population of 250,000. “I’m from a really small town in Belgium and we are all hunting for the same talent. It’s really hard to find the right people for the right place. And even once you find skilled workers, the cross-border administrative procedure and taxes are a burden.”