Plans to increase tech unicorns tenfold in Europe proposed

Plans to help boost the number of privately owned European companies valued at more than $1 billion (€820 million) are to be presented to the EU Commissioner for Innovation Mairya Gabriel on Monday.

Representatives from organisations across the EU will formally deliver their plans at a virtual start-up summit as part of a bid to encourage the European Commission to do more to help promising companies become so-called "tech unicorns". Overall, the aim is to increase the number of such companies tenfold over the next decade.

Among the recommendations included in the plans are a pan-European approach to assessing the growth of start-ups in terms of data collection and monitoring. Other actions include improving the availability of talent through steps such as supporting female entrepreneurs, and strengthening supports through among other things, the adoption of a start-up friendly public procurement policy.

There is also a call for the implementation of start-up friendly policies, including tax incentives for growth, better treatment of employee stock options and the implementation of a pan-European start-up green card or visa.

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"This is an ambitious and important initiative as it has been drawn up by national start-up organisations across the EU and it provides the European Commission with a very clear and comprehensive list of measures to help Europe become a global leader for start-ups," said Martina FitzGerald, chief executive of Scale Ireland.

“If most of these recommendations were enacted, it would be a game changer for the sector in Europe. It also recognises the need for the European Commission and political leaders to adopt an EU-wide approach to the sector, which has huge potential in terms of innovation, employment and exports,” she added.

Unicorns

Currently, there are believed to be more than 80.000 start-ups in the EU, of which over 50 are recognised are classed as unicorns – the name given to private companies valued at $1 billion or more. This list includes companies Intercom, Workhuman and fintech Fenergo, which earlier this month become the State's third official Irish tech unicorn after selling a majority stake in the business for $600 million.

Globally, there are about 670 unicorns, with Stripe, the San Francisco-headquartered online payments company founded by Irish brothers Patrick and John Collison, among the biggest with a $95 billion valuation.

European companies have lagged counterparts in the US and Asia particularly when it comes to the tech space, although the gap is narrowing. The investments raised by European start-ups totalled $41 billion in 2020, up from $36.6 billion a year earlier.

However, while a recent report indicated that 27 European companies achieved unicorn status during the first quarter, just seven of these are based in the EU27 and committed to remain there.

Speaking ahead of the meeting, Ms Gabriel said: “I am convinced that if the ecosystem leaders and the political leaders work together we can build a true pan-EU innovation ecosystem that will help the new generation of innovators and entrepreneurs to scale up and become tech champions to help Europe in a greener and digital Covid recovery”.