At several occasions throughout the EU policy development, the importance of utilising renewable biological resources and converting them into value added products such as food, feed, and bio-based products is highlighted. Most recently mentioned as a part of the European Green Deal.
Yet while Europe leads the world in commitment to a circular bioeconomy, many innovative companies are still not able to fully unlock this potential for their technological projects and processes due to difficulties in accessing funding or financing in spite of the many available opportunities at national and EU level.
Financing plays a critical role in innovation, allowing SMEs and organisations to carry out research, adopt technologies necessary for inventions as well as develop and commercialise these innovations. Access to external sources of finance is often particularly challenging for smaller businesses at seed or early stages of business development as they have no documented track record. Funding needs and funding availability are closely related to the stage of development of the firm and its innovation projects. In the early stages, when inventions are developed and research conducted, there is still considerable uncertainty about what results and innovations will emerge, if at all.
At more advanced stages, as prototypes are developed, specialised investors such as venture capitalists and business angels are more willing to get involved.
In the final stages, once there is more clarity concerning technologies and markets, more traditional investors can provide funding. The situation is however more extreme in the bioeconomy where figures from the European Investment Bank’s report Study on Access-to-finance conditions for Investments in Bio-Based Industries and the Blue Economy from 2017 show that 77% of all bioeconomy companies experienced problems in accessing funding. While the number of successful investments is growing, private financing is proving difficult still. Private investors including business angels, venture capitalists and corporate VCs have stepped in with high profile investments, but they remain extremely selective in their investment opportunities and demand that SMEs and projects must be prepared in terms of project scalability and investment readiness – which is rarely the case. SMEs too, need to understand what investors are looking for how to address information requirements, reduce risk premiums and secure investments.
This is why this project has gathered five strong agrifood & bioresource investment innovation agents during 12 month from September 2021 to August 2022 to exchange best practices and clarify opportunities across Europe through five study trips and workshops. The name of the project is P2P finBIO and it has been received funding as convened in Grant Agreement NUMBER 967555.
