RAISE Project’s Common Action Plan to Strengthen the Startup Ecosystem

• May 29, 2024

The RAISE initiative has developed a detailed Common Action Plan aimed at providing comprehensive support to start-ups and scale-ups. This plan addresses several key areas including initial funding, research assistance, public incentives, and strategies for internationalisation. The plan acts as a guide to help start-ups expand their operations effectively, focusing on:

• Start-up creation and market entry
• Talent attraction
• Regulatory collaboration
• Public procurement participation
• Access to finance
• Digitalisation

Target Audiences

The Common Action Plan primarily targets:

• Start-ups: Young companies with high growth potential.
• Investors: Venture capitalists, angel investors, and mentors.
• Ecosystem: Entrepreneurs, mentors, accelerators, government agencies, and universities.
• Policymakers: Officials and regulators shaping the legal landscape for start-ups.

Secondary audiences include innovation hubs, knowledge transfer agencies, and industry associations.

Expected Impact

The plan aims to:

1. Strengthen collaborative innovation among public, research sectors, and creative businesses.
2. Promote experimental policy creation and public sector participation.
3. Support start-ups in accessing international markets.

Additional benefits include faster and safer innovations, enhanced entrepreneurship, investment, and economic growth.

Analysis of Barriers

The RAISE Common Action Plan identifies key barriers impacting start-up growth:

1. Access to Finance:
   • Limited venture capital and traditional financing options.
   • Weak business models reducing investment interest.
2. Regulatory Environment:
   • Complex and costly regulations.
3. Infrastructure:
   • Inadequate physical and digital infrastructure.
4. Market Access:
   • Trade barriers and lack of market information.
5. Talent Pool:
   • Shortage of skilled workers and challenges in attracting talent.
6. Entrepreneurial Culture:
   • Societal norms stigmatising failure and discouraging risk-taking.
7. Support Services:
   • Limited mentorship and industry connections.
8. Internationalisation:
   • Challenges in expanding into foreign markets.

Impact on Stakeholders

• Investors: Limited funding affects start-ups’ growth and investors’ returns.
• Policymakers: Complex regulations discourage entrepreneurship and investment.
• Ecosystem: Gaps in infrastructure and support services need collaboration to create a supportive environment.
• Start-ups: Market access difficulties highlight the need for supportive initiatives.

Key Areas of Focus

1. Start-up Creation and Market Entry:
   • Streamlined processes and strong support systems.
   • EU-wide training programmes and Erasmus for young entrepreneurs.
2. Talent Attraction and Retention:
   • Improve the EU’s talent attraction framework.
   • Promote a diverse and inclusive work culture.
   • Implement training programmes and offer stock options.
3. Regulatory Innovation:
   • Work with regulators to create supportive policies.
   • Participation in regulatory sandboxes.
   • Promote start-up involvement in industry associations.
4. Innovation in Procurement:
   • Engage in public procurement processes.
   • Expand networks and partner with ambitious buyers.
   • Simplify intellectual property rights processes.
5. Access to Finance:
   • Government incentives and support.
   • Raise awareness and increase funding opportunities for disadvantaged entrepreneurs.
   • Enhance public-private co-funding initiatives.
6. Digitalisation:
   • Embrace digital technologies.
   • Use European Digital Innovation Hubs.
   • Promote ethical data use and digital transformation.

Start-up Creation and Market Entry: The fast start-up creation dimension emphasizes the need for streamlined processes and robust support systems. Key initiatives include promoting Erasmus programs for young entrepreneurs and implementing EU-wide training programs. These programs will help start-up founders develop go-to-market strategies and product creation plans, essential for successful market entry. By connecting with experienced entrepreneurs and experts, founders can navigate the entrepreneurial path more effectively.

Talent Attraction and Retention: Attracting and retaining talent is instrumental for start-up success. Enhancing the EU’s talent attraction framework, such as the Talent Booster Mechanism, is essential. Additionally, fostering a positive, diverse, and inclusive work culture is crucial. The RAISE Consortium suggests implementing targeted training programmes and leveraging the potential of researchers to enhance talent attraction strategies. Offering stock options as part of a standard, well-structured program can further incentivise talented employees to join and stay with start-ups.

Regulatory Innovation: Start-ups need to collaborate with regulators to co-create policies that support entrepreneurship. Participation in regulatory sandboxes, where new products and services can be tested, is a significant step forward. Raising awareness among regional and national governments about the benefits of these tools and promoting start-up participation in industry associations can amplify their voice in the market and influence policymaking.

Innovation in Procurement: Engaging in public procurement processes can be mutually beneficial for start-ups and public entities. To lower access barriers, start-ups should expand their networks and partner with ambitious public and private buyers. Key milestones include establishing a digital platform for listing requests for proposals and organizing hybrid events like supplier innovation days. Simplifying intellectual property rights registration and enforcement processes is also crucial.

Access to Finance: Governments play a crucial role in providing incentives and support for start-ups, given their unique financial needs. Raising awareness among founders and investors and increasing funding opportunities for disadvantaged entrepreneurs, such as women and those in rural areas, are vital steps. Scaling up matchmaking platforms like Euroquity and Dealflow and enhancing public-private co-funding initiatives can also boost financial access for start-ups.

Digitalisation: Digital transformation is essential for improving efficiency and customer experience. Start-ups are encouraged to embrace digital technologies and leverage the potential of European Digital Innovation Hubs to enhance competitiveness. Scaling up initiatives under the Digital Europe Program, with a specific focus on start-up support, is also critical. Establishing EU-funded mentorship programs and promoting ethical and responsible data use are additional measures to ensure start-ups thrive in a digital-first environment.

Policymaker Insights

The document provides policymakers with valuable insights into the needs and expectations of the start-up ecosystem. The identified policy milestones highlight key initiatives required at regional, national, or EU levels to support each action in the plan. The analysis underscores the importance of establishing collaboration networks to facilitate interactions between start-ups, investors, corporations, researchers, and policymakers.

RAISE initiative supports a supportive and dynamic environment for start-ups

According to the latest Startup Nations Standard Report, there has been notable improvement in the dimensions defined by the European Startup Nations Alliance (ESNA). However, there is still room to scale up policy initiatives to achieve the proposed actions in the RAISE plan. By addressing these critical areas, the RAISE initiative aims to create a supportive and dynamic environment for start-ups to thrive, ensuring sustainable growth and innovation across Europe.