Press play to listen to this article
It takes a village to raise a startup.
That’s European Innovation Commissioner Mariya Gabriel’s message to her colleagues as she tries to drum up support for her Innovation Agenda. The agenda aims to help the European Union’s growing tech companies tackle a range of long-standing issues, like hiring talent and accessing capital. The breadth of Gabriel’s vision means she must reach out to almost a third of her fellow commissioners.
It’s a potentially tricky approach. Just two commissioners — competition czar Margrethe Vestager and internal market chief Thierry Breton — led the bloc’s efforts to tame Big Tech in the form of the Digital Markets Act and the Digital Services Act. Both bills were approved at a speedy clip. The EU’s plans to bolster its own startup ecosystem, on the other hand, consist of 25 action points and are dependent on the goodwill of several different commissioners whose portfolios land within the agenda’s scope. It remains to be seen, however, whether these commissioners are on board.
In an interview with POLITICO, Gabriel defended her wider approach: “We are showing that we are ready to act as a team.”
Hunting up talent
Ahead of the publication of the agenda’s text, startup founders and investors expressed the hope that the EU would move to fix their hiring problem — fueled by a lack of skilled tech professionals and exacerbated by startups’ struggle to compete with bigger, more established corporations when it comes to recruitment.
One trump card startups can use to their advantage is handing out equity, which lets employees who come in early cash out when the company hits big.
The agenda’s text, however, promises only the set-up of a “working group” of EU member countries to examine the equity issue and what it means for taxation — leaving startups decidedly unimpressed at an event the day after.
Gabriel defended the agenda’s approach, pointing to ambitious approaches to attracting talent in the plan: “If you like to have [an] excellent innovation ecosystem, we need excellent people. And these people have to have access to competencies, to training, to education.”
These are addressed in the agenda, she said. “The ambition is very clear: [In] the next three years, we would like to offer training for 1 million people in deep tech.” That task will be handed to the European Institute of Innovation and Technology, which has been involved in innovation and entrepreneurship courses since its creation in 2008.
Gabriel was also confident that the proposed working group would be able to meet startups’ demands for clarity on the equity question.
“I perceived their demand for something more consistent, something more proactive, but it’s the first time we’re addressing this issue,” she said. Now that equity has emerged as a major sticking point, she said, the working group can move quickly to address it. “I’m sure that very rapidly, we can see if there’s support coming from the member states,” an acknowledgment that EU member countries are still in charge of taxation, a key factor in solving the equity conundrum.
We’re on each other’s team
Gabriel is used to relying on others to get proposals over the line. The EU’s listing act, which will smooth companies’ paths to the stock exchange through a simplification of requirements, is in the hands of Financial Services Commissioner Mairead McGuinness. Meanwhile, Cohesion Commissioner Elisa Ferreira has been enlisted to close the West-East investment gap. Both initiatives are included in Gabriel’s agenda.
For Gabriel, such burden-sharing is no frustration — and she knows exactly whom to approach.
“You need a Team Europe approach; we need different commissioners looking in the same direction … With Thierry Breton for sure,” she said. “When we [are] talking about listing, Mairead McGuiness, [Executive Vice President] Valdis Dombrovskis for the stock-options regime.
“Of course, we have our [Executive] Vice President Vestager. When we talk about talent, reskilling and upskilling, [Jobs and Social Rights Commissioner] Nicolas Schmit; Elisa Ferreira for regional innovation. We are seven, eight commissioners that are very, very much involved in this.”
This collaborative approach might be a difficult message for European startups to swallow. They’ve previously voiced frustrations with figuring out with whom to speak in Brussels and shared feelings of neglect, as policies have tended to focus on more established companies.
Gabriel admitted that some startups may have become jaded by “beautiful words for many years.” It will take positive actions to break through their skepticism: “We have to stay a little prudent sometime[s] — it’s better to show them,” rather than tell them.
The global economic downturn has also made it difficult for nascent firms to get off the ground, rocking private funding markets. On the day this interview was conducted, the valuation of Swedish fintech company Klarna went down from $45.6 billion to $6.7 billion. In such an unforgiving climate, public funding — such as through the bloc’s recovery fund — will be more important than ever, Gabriel agreed.
She’s optimistic, though, that Europe’s startups will weather the crisis: “What I have seen with our startups the last two years, is that they are really talented to show that crisis means opportunity for them.”
This article is part of POLITICO Pro
The one-stop-shop solution for policy professionals fusing the depth of POLITICO journalism with the power of technology
Exclusive, breaking scoops and insights
Customized policy intelligence platform
A high-level public affairs network