EIF’s Incoming Chief: Europe’s Tech Champions Funds Hold 15 Unicorns

TURIN, ITALY – Jean-Christophe Laloux, the incoming chief executive of the European Investment Fund (EIF), announced today that the European Tech Champions Initiative (ETCI) has been instrumental in fostering the growth of the continent’s tech ecosystem, with its backed funds now holding an impressive 15 European unicorn companies. Speaking at the Wave by Vento conference in Turin on Friday, Laloux emphasized Europe's need to not only innovate but also scale its burgeoning tech enterprises within its borders, framing it as a critical component of "sovereignty."

Laloux, currently the director general for EU lending and advisory operations at the European Investment Bank (EIB) and set to take the EIF helm on January 1, clarified that this drive for sovereignty does not equate to protectionism. Instead, it aims to cultivate robust European alternatives in crucial sectors ranging from cyber resilience to critical raw materials, ensuring that innovative startups can thrive and grow without being forced to seek capital or exit opportunities outside the continent.

Bridging the Growth Funding Gap

The EIF's strategic shift comes in response to a recognized bottleneck in European tech, which has moved from early-stage innovation to the critical growth phase, specifically Series B to C funding rounds. To address this, the European Tech Champions Initiative was established as a nearly €4 billion “fund of funds,” supported by six member states and the broader EIB Group. Its primary objective is to invest in venture funds reaching approximately €1 billion in size.

These larger funds are designed to provide the substantial capital required for companies that have successfully completed their Series A and B rounds, enabling them to accelerate their expansion while remaining headquartered in Europe. Laloux highlighted the initiative's success, noting it has already backed 12 such funds—a significant increase compared to just a handful of €1 billion funds existing in Europe five years prior. These 12 funds collectively boast 15 European unicorns in their portfolios.

Expanding Reach and Future Plans

Looking ahead, Laloux anticipates the announcement of a second iteration of the European Tech Champions Initiative in November. This expansion will broaden its scope to include backing smaller funds, specifically those ranging from €300 million to €500 million. This move acknowledges that not all European ecosystems can support funds of the €1 billion scale, thereby ensuring wider access to growth capital across the continent.

Furthermore, the expanded initiative will introduce a new platform designed to facilitate co-investment opportunities for institutional and private investors alongside the EIF-backed funds. Italy has been an active participant in the initiative, contributing €150 million. This investment has already translated into nearly €600 million being funneled into seven Italian companies, with three of these attracting international co-investors—a clear indicator of the Italian tech ecosystem's growing appeal.

Beyond the Tech Champions Initiative, the EIB Group supports startups through venture debt, a flexible financing option with no repayment obligations for at least five years. Instead of high interest, the EIB takes warrants or other success-linked rewards. The group also plays a crucial role in structuring the equity component of the European Innovation Council's funding for nascent startups.

Key Focus Areas: Deep Tech and Strategic Sectors

Laloux underscored the dramatic rise of deep tech in Europe, which has seen its valuation surge from approximately €1 trillion to €4 trillion over the last five years, outpacing all other economic sectors. The EIF's investment strategy will concentrate on four critical areas where Europe maintains a leading edge: Artificial Intelligence (AI), health and biotech, security and defence (including cybersecurity), and cleantech.

He specifically cited examples like Isar Aerospace, whose Spectrum rocket launched from Norway, as a beneficiary of EIB Group-backed funds, demonstrating success in the space sector. Security and defence, encompassing cybersecurity, has witnessed the most substantial growth in capital investment and valuations over the past year.

Addressing AI, Laloux stressed its potential to significantly boost productivity and cautioned against two extremes: leaving AI entirely unregulated or stifling it with excessive rules. He revealed that the EIB has allocated €3 billion towards supporting the EU’s ambitious AI gigafactories, signaling a strong commitment to developing foundational AI infrastructure within Europe.

FAQ

Q: What is the main goal of the European Tech Champions Initiative?

A: The main goal of the European Tech Champions Initiative is to close the funding gap for European startups in their growth stages (Series B to C), enabling them to scale within Europe and reduce the need to seek capital or relocate outside the continent.

Q: Which sectors are the EIF's primary focus for investment?

A: The EIF's primary focus areas for investment are Artificial Intelligence (AI), health and biotech, security and defence (including cybersecurity), and cleantech, all falling under the broader deep tech category.

Q: How is the European Investment Fund expanding its support for venture capital?

A: The EIF plans to expand its support by backing smaller venture funds (ranging from €300m to €500m) and by introducing a platform for institutional and private investors to co-invest alongside its funds, making capital more accessible across diverse European ecosystems.