EIC Investor Day on the EU Green Deal: Sustainable lessons learnt
Early 2020, the European Commission set a very ambitious growth strategy to make Europe carbon neutral by 2050, via the EU Green Deal. Recently the target for 2030 was further strengthened to 55% of greenhouse gas reduction by 2030. The EIC Accelerator is supporting the EU Green Deal via a dedicated funding call and the consequent selection of 64 Green SMEs. In addition to the funding, the EIC supports this ambitious agenda through a series of events like the EIC Greenathon and EIC Investors Day on the EU Green Deal.
The event, which took place on 10 and 11 November 2020, hosted four pitching sessions where 36 companies, across the diverse areas of the Green deal, pitched in front of more than 40 investors (more on the pitching session and winners here). The event also featured three panel sessions focused on the sustainability and impact investments landscape, trends in climate technologies and green EIC success stories. With vibrant discussions, interesting talks and thought-provoking questions, the panels offered something for everyone. Below you can find the main take-aways, in addition to some highlights from Remy de Tonnac (ETF), Tove Radelius (Norssken VC) and Yann Lagalaye (Demeter), who joined the event as panellists and/or investor juries.
Urgency is knocking at our door –climate change will impact us many more times than the COVID crisis. The good news is that novel technologies are maturing, there is a strong market demand for sustainable products and more emphasis is put on it by legislators, corporates and investors. The world is moving, and Europe is moving faster, but still at just a fraction of the pace needed in comparison to the challenges at stake. New European companies should focus from the very onset on the customer experience and product development.
“The EU Green Deal shows we can do things European-wide. It’s a long road, but we are becoming aware that we need to do something together. Now we need to be more innovative. The EIC is a key player in innovation in Europe, so I felt that attending the EIC Investor Day was a must. In addition, the panel was a good opportunity to exchange with other investors.”
Yann Lagalaye, Demeter
Impact investment is becoming mainstream and a core part of the European tech ecosystem - According to the “Global impact startups” presented by Matteo Renoldi impact specialist at Dealroom.co, Europe is more impact focused than other parts of the world. For example, impact investing accounts for over 15% of total European VC investment, 3x more than in 2010 and double the global average. However, very early stage impact investments (for example, of business angels) are still at a low level and would still need governmental support.
Sustainability and profitability go hand in hand - Investing in companies that address the sustainability challenges is not only good for our planet. It’s also generating financial returns above average in some sectors. There is no trade off or choice to be made between sustainability and profitability. Sustainability will drive profitability – put it simply - if you are not sustainable, you will not be profitable.
“I met many new companies that weren’t on our radar yet and learned about many interesting technologies. We want to get in touch with companies in an early stage and stay in touch. Once the time is right, we know each other and to progress further. In addition, the EIC Investor day proved to be a great opportunity to network and speak with other investors as well.”
Remy de Tonnac, ETF
Decarbonising our economy mean radical transformation in all economic sectors - An important part of impact investing is represented by climate tech. According to a detailed report prepared by PwC “The State of Climate Tech 2020“ and presented by Azeem Azhar – senior advisor at PwC and Founder of Exponential View, climate tech encompasses a broad set of sectors which tackle the challenge of decarbonising the global economy. The self-reinforcing trends, the emergence of new and cheaper technologies, a greater consumer demand for sustainability, growing corporate demand and more supportive policies and regulations could drive and increase the needed investments for this radical transformation in less than 30 years.
“Our fund’s focus is investing in companies in Seed to Series A stage, seeking to solve some of the world’s greatest challenges, while building highly profitable businesses. Given EIC’s focus on European high-risk, high-impact technologies, there is a good match. The EIC tends to attract the top entrepreneurs, so the Investor Day is a fantastic event for us to attend in order to meet entrepreneurs, other investors, and staying on top of the latest trends.”
Tove Radelius, Norssken VC
The boom in investment in climate tech is here to stay - Climate tech is a mega trend as VC investment into the area is growing at five times the average growth rate. However, it’s still early days in terms of the overall VC market (approximately 6% of total capital invested in 2019), of which the European market attracted $7 billion. It is important to view the entire scaling up process and invest also in later stage Venture Funds (B,C,D etc) able to back the full growth cycles of companies and make them global leaders.
Europe can be the global climate tech leader - If the US and Asia have a leading edge in the digital space, Europe can lead on climate tech. If it wishes to do so it needs to build an ecosystem that is conducive to large-scale investments. The EU Green Deal paves the way in this context and gives a high-level direction. A tool like the EIC, with the stronger firepower of the EIC fund, should be the cornerstone of this ecosystem. And this should help the bright and smart entrepreneurs with wild and innovative ideas to scale up and conquer the world The EIC success stories are an example in this respect, as the funding and reputation of the programme have been crucial allowing them to enter new countries, develop new products, increase the turnover, and employees.
Finally, to conclude - this is not only about funding – this is about every player’s cooperation and governance: entrepreneurs, investors, governments, citizens, and also less traditional players such as family offices are needed to work together and address the great challenges of making our economy greener and our world a better place to live.
Looking for ways to connect to top-class investors and peers?
We host regular EIC Investor Days, as well as ePitching with Investor-sessions, all based on your company profiles in ScaleUp EU. Next up is the EIC Investor Day: Women in Tech 2.0. Keep an eye on our events page for more information on future events. If you are interested in joining, don’t miss out and update your profile information straight away. If you need help, please contact us through our contact page (choose ScaleUp EU: claim access).