A new Risk Capital Action Plan 2020 was unveiled at this year’s EVCA Venture Capital Forum in Berlin. Throughout the day panellists and speakers alike agreed that Europe needs more investment and less regulation if it wants to remain viable over the next few challenging years.
If EVCA are successful, the new plan will see the European Union to increase its investment programme in venture. EVCA hope that through the creation of a new pan-European fund-of-funds that will resemble the UK Innovation fund, European companies will have the incentive to stay in Europe. Anything from infrastructure, turnarounds, public to privates or cleantech will be included in the plan, however, EVCA are calling on the EU to match the venture allocation.
Echarri was quick to point out that now is the optimum time to be making a case for venture to the EU. There is a new commission that wants to focus on technology, a new parliament and the EU is making decisions on what it is going to do over the next few years.
Being on the ground at this conference it is easy to see that many venture capitalists have their doubts about EVCA’s plan. Nils Madeja, investment manager at German-based ECapital was sure that the UK, France and Germany would receive almost all of the funding, whether they wanted it or not. “It will become political. A lot of German companies don’t like handing over equity stakes to investors but they will also want their share of the funding,” he says. Echarri does not deny this claim and in fact at the close of the day told EVCJ that it is likely that clusters will form and as a result the plan and certain areas will receive the lion’s share of the funding.
In other news of the day, Paul Deninger, vice chairman of Jefferies & Company followed on from Echarri with some sobering statistics about the European and US venture markets over the past year. The first quarter of 2009 saw the worst exit market in memory. None of Deninger’s information could really be deemed news but the sheer amount of data he had on the troubled state of the global VC industry reinforced Echarri’s call to arms.
In the afternoon a panel discussed how Europe can maintain its lead in Cleantech. The panel that was moderated by Joerg Sperling, partner at WHEB Venture Partners concluded that the Europe is still paving the way for global cleantech and solar is the best place to invest.