Holy Tech Batman! — Can The European Commission Be A Startup Super Hero?

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For Your Diary — The Best European Events For Startups In 2014

What is to be done with Europe? As The New York Times wrote just two days ago, there are not enough people in Europe qualified to fill all the technology jobs available. At the same time, Europe is not producing really big platforms to take on the global players. Too much of European technology has been caught up producing client-driven businesses in enterprise. As it is often said, where are the platforms like Google, Facebook and or Twitter in Europe? We can’t recycle stories about Skype forever. There are some amazing companies coming though. But more are needed.

So it is that the European Commission wants European member states to develop ‘a new generation of web services’, and of course, reap the economic benefits from those.

Of course, the Commission is not the magic bullet, or the super hero to save the day. But it wants to try.

There’s no getting around it. For a long time Europeans have looked with envy upon the sheer scale of technology innovation coming out of places like the USA (in software and internet platforms) and Asia (in hardware). The Commission, quite rightly, wants to help do something about this.

So back in May 2013 it introduce a set of ‘6 actions’ by the EC VP for Industry & Entrepreneurship, Antonio Tajani as part of its grandly titled “Entrepreneurship 2020 Action Plan”. The little unit inside the Commission to deliver this is one year old, which, in EU Commission terms, is a teeny tiny baby.

So the question is, can they do it, and what the hell is their action plan?

Well, their Action Plan described as a blueprint for “decisive action to unleash Europe’s entrepreneurial potential, to remove existing obstacles and to revolutionise the culture of entrepreneurship in Europe.” (This was developed after a public consultation process with a number of European entrepreneurs).

The aim is to invest in in changing the public perception of entrepreneurs (typically poor in risk-averse European business culture), in entrepreneurship education and to support groups that are underrepresented among entrepreneurs. The aim is to revitalise an entrepreneurial spirit which has considerably declined in the postwar years. And let’s face it most jobs are created by SMEs and micro-firms that did not exist even 5 years ago.

The Commission wants to under-pin the idea that it is only when a large number of Europeans recognise an entrepreneurial career as a rewarding and attractive option that entrepreneurial activity in Europe will thrive in the long term.

So, what in each is in this “Entrepreneurship 2020 Action Plan”. Well, it has three main pillars: Entrepreneurial education and training; the creation of a business environment where entrepreneurs can flourish and grow; and finally, highlighting role models while also reaching out to specific groups whose entrepreneurial potential is not being tapped to its fullest extent.

Since it issued it’s action plan, the Commission has delivered six initiatives aimed at each of the above actions, which I’ll go into in a moment.

• Setting up a Startup Europe Partnership
• The “Leaders Club” of entrepreneurs
• MOOCs for increasing web talent in Europe
• Accelerators Assembly – A Commission-funded network of tech Accelerators who are asked to share knowledge and information.
• A network of EU investors active in raising venture capital
• An EU crowd-funding network

These activities are, in theory targeted as ‘web entrepreneurship’ (or W.E. as they like to call it) and is all about helping to cultivate more ambitious tech start-ups which, crucially, are also able to scale into full-blown going companies, while boosting overall economic growth and jobs in the internet-based economy.

The EU Commission has a motto for this action plan which is ‘start in Europe and stay in Europe’. Of course, it’s not going to suit every business, but it’s a laudable thought.

In order for this to happen they want to overcome what obstacles there are in Europe to starting up and to work out how they can enhance startups to ‘scale up’ inside the EU and compete internationally.

Here we detect a slight problem in the thinking. Many startups will want to scale internationally from the word go, not just in the EU.

But, of course, it’s only the EU area of member states that the Commission can deal with anyway. That said, if the EU can create some sort of ‘best practise’ there’s nothing to stop nearby non-EU states taking a leaf out of their book.

One area the Commission thinks it is ‘doing OK’ in is the area of the Telecom Single Market legislation – an area championed during Neelie Kroes’ second term in office, with it’s aim to reduce the cost and legislative burden on companies, and the geographical asymmetries that prevent ‘single market’ economies of scale. And to be fair, she has been pummelling the networks to reduce roaming costs – and it does indeed look like those will come down year over the next few years.

So what has the Commission been doing in a concrete manner on the ground, and where do they go next?

The answer is six main initiatives, with a couple of ancillary activities tacked onto the end.

• Startup Europe

They set up the Startup Europe which covers a a wide range of activities and calls on private sector to come together to support European startups. A number of these are listed here.

Confusingly, They have registered, and promote this URL StartupEurope.eu

which simply re-directs to this long URL. Meanwhile, they also have Launch.StartupEuropePartnership.eu which isn’t doing anything right now.

Under the banner of Startup Europe, the Commission ran “Tech All Stars”, which was basically a European Commission-backed effort to run a startup pitch competition. Except they did not run it. It was a series of two competitions run by AngelsBootcamp and Founders Forum culminating in the overall winner, Trustev, being showcased at the Digital Agenda Assembly in Dublin on the 19th June.

Note that this has a different logo to the StartupEurope Partnership. Confused yet?

Under the list of achievements is the expression of interest and the quality of the corporate ‘pledges’ received so far from companies such as Telefonica, Microsoft, Adobe, Google.

The pledges they are after include things like mentoring, Open office hours, access to office spaces, funding, training, etc etc. All things corporates are famously bad at, of course, but at least it’s something.

They’ve had Telefonica bring Campus Party to Europe. Microsoft pledged to create CoEntrepreneurs.eu as a “a platform, a community and a collection of 2.0 initiatives enabling massive entrepreneurship support by the entrepreneurs themselves” – however, the site re-directs to CoEntrepreneurs.be, a Belgian domain, and a site with a couple of guys taking in French about startups. Not very Microsoft.

There’s also a vague commitment from Microsoft BizSpark to engage with European Institutions, but since this is simply cover for MS to sell software then you’d expect them to do this anyway.

The Leaders Club

“The Leader’s Club” is a group of six successful web entrepreneurs assembled by the Commission to basically come up with a list of things they think Europe should do, which they called the Startup Manifesto.

These are: Daniel Ek (Spotify), Kaj Hed (Rovio), Joanna Shields (Tech City UK), Reshma Sohoni (Seedcamp), Boris Veldhuijzen van Zanten (The Next Web), Zaryn Dentzel (Tuenti), Niklas Zennström (Atomico) and Lars Hinrichs (formely of Hackfwd).

In March last year they met EC VP Neelie Kroes and in September launched their Manifesto of 22 actions needed to boost entrepreneurship for internet-driven economic growth across Europe. They boiled down to five headings: improving tech skills and education in Europe; making it easier to access talent in and outside the EU; increasing access to capital; modernising data laws across the EU; getting European countries to take ‘thought leadership’ in tech.

They tested the interest in the manifesto by subjecting it to public vote, but that garnered a relatively low 3,000 or so votes. That said, the ideas were rock solid. Indeed, the Leader’s Club has probably come up with amongst the best output of any Commission initiative to date – assuming anyone is listening.

If this were to go any further, one might suggest they look at the UK’s Tech City policy of creating a ‘Fast 50′ layer of much larger startups on their way to an IPO.

• Fostering Web Skills

The Commission has put out to tender a project to study the capability of MOOCs to improve web skills in Europe, for EUR 90,000. The study is due to report later in 2014, and will map the supply and demand for these, with the results to be published at a conference Q3 2015. The MOOCs Tender was launched to explore short term and long term objectives in developing massive online courses, such as the ones launched by Stanford’s Coursera, or MIT’s EdX which have had an explosive growth.

Massive Online Courses have clearly aided the development of skills, though, arguably, basic Computer Science combined with trawling the web for the usual coding resources works equally well.

There’s little to say about this initiative other than it’s probably a good idea to get data on MOOC usage in Europe.

• The Accelerators Assembly

This is a network of tech Accelerators which was launched in the first half of 2013. It was set up as an on-line group but has had some offline meetings. It has some 200 active accelerator members who are supposed to be sharing knowledge and information about access to funding opportunities. The Commission has commissioned a report expected Q1 2014 to summarize the overall situation in Europe with respect to the growth of accelerators.

• Web Investors Forum – A network of EU VCs

This is the work to create a network of Venture Capital firms, ongoing since March 2013. Oddly, although this is to “create awareness” about the growth of web services, you can probably agree that they already know this already. However, there is more specific work going on to survey of over 60 VCs and publish the results later this year.

• Crowdfunding Network – the EU crowd funding network

Once again we have a separate web site for a pretty related project. Launched in June 2013 by various Commission departments, the idea here is to make EU member states aware of the movement of Crowdfunding and ‘Crowd-Equity’ financing for startups. Why? Well, to put it bluntly, this who thing has apparently not been noticed at policy-making levels by quite a lot of EU states. This has led to some very non-EU friendly behaviour, such as the fact that legislation in Germany and Italy has a completely different view of what crowd funding actually is. Thus, ‘harmonisation’ – a favourite EU word – of the on-line crowd funding market is very relevant. If EU platforms played by the same rules, then they would be able to raise much bigger sums of funding. The Commission plans to commission a report analysing the policy priorities in the EU and run an event around this issue in the second half of 2014.

Other Activities

Aside from all this, the Commission has started some work on trying to dynamically map what is going on in Europe across the EU ecosystem, but there has not been results of that published yet.

In addition, the Commission has been dabbling in what amounts of PR works for startups.

It created the Europioneers awards to use its media profile to highlight the work of startups, alongside the Techallstars activity.

So there you have it, a long laundry list of things the Commission is planning or already implementing.

The question is, can they achieve what they have set out to do?

And should the Commission even be dabbling in these initiatives at all?

The questions is, are these the right things? Many would argue that the Commission would be better off emphasising that EU Members States invest vastly more into Computer Science and Engineering skills, than dabbling in startup competitions usually better run by the private sector.

With Europe facing a skills and entrepreneurship gap over the next few years, it would seem they have to do something.

Disclosure: The EU Commission paid travel expenses to Brussels in the process of the research for this article.