The European Union (EU) will invest millions of euros in Israeli start-ups, Globes has reported, as part of a €100 million ($112.3 million) pilot scheme within the European Innovation Council’s Horizon 2020 framework.
According to the article, the European Commission will invest up to €15 million ($16.8 million) in Israeli companies “for the purposes of commercializing products, in exchange for shares”.
The programme will be known as “Accelerator Pilot”, “and will provide resources for commercialization purposes such as sales and marketing of a finished product”.
Globes explained that the financing will go to companies “developing a product capable of having an impact on the European Union and the world” but who have difficulties in raising finances “on the private market because they are in fields such as cleantech or medical devices”.
According to the report, “this is the first European Commission scheme in which the Commission will take equity stakes in start-up companies.”
European Innovation Council (EIC) funding under the Horizon 2020 programme is granted to Israeli companies via the Israel Innovation Authority.
“Horizon 2020 is the EU’s eighth framework programme for research and development, with a budget of €77 billion [86.5 billion] over seven years”, Globes said. “Israel pays about €1 billion [0.89 billion] into the programme, and receives support for various projects to the tune of some €1.5 billion [1.7 billion].”
The report notes that the programme “has become an important source of funding for research and development in Israeli industry and in its academic institutions.”
“Besides finance, it offers opportunities for collaboration with European companies and research institutes, and direct contacts in the European market for marketing and sales of products and technologies.” Israel, like Norway and Switzerland, is an Associated Country in the programme.
In 2018, 423 Israeli companies and researchers received research and development grants totalling some €180 million (202.9 million), with 50 companies receiving the maximum grant of €2.5 million ($2.8 million).