Positive Developments for Start-ups and Entrepreneurs in the New Multiannual Financial Framework
During the latest updates, the “European Bubble” has been very active in debating the news regarding the Commission and Parliament’s proposals on the next Multiannual Financial Framework. Ursula von der Leyen announced the European Competitiveness Fund (ECF). While the exact financial allocation for the ECF is still under discussion, some analysts suggest that the fund should be equivalent to other international competitiveness funds worldwide. This would mean at least 1.38% of the EU’s GDP, amounting to approximately €237 billion over seven years.
On the other hand, the latest announcements about the new Horizon Europe—FP10—indicate a budget increase to foster investment in Research and Innovation (R&I), aiming to reach at least 3% of EU GDP. The new Horizon Europe programme will fund more high-quality proposals, targeting a success rate of at least 75% for excellent applications. It will prioritise industrial competitiveness, the twin transitions (green and digital), and societal resilience.
The EU is shaping the new Multiannual Financial Framework to boost innovation and the growth of European SMEs and start-ups, making them more competitive in an increasingly diverse and disruptive global landscape. A key concern is that a close connection between the Research Framework Programme and the Competitiveness Fund could limit the funds allocated to research. This means a stronger focus on innovation rather than basic research, aiming to better compete with other global powers such as the US and China—especially following the rapid development of technologies like artificial intelligence. This new alignment could also help Europe generate more unicorns and unlock the growth potential of its SMEs to compete globally.
This shift will create more opportunities for entrepreneurs and start-ups to grow their projects. The emphasis will move from research to innovation and growth, redirecting some programme target audiences from universities and research centres to other economic actors such as industrial enterprises and innovative start-ups.
Start-ups play a vital role in transforming cutting-edge research into market-ready solutions, which aligns closely with the European Commission’s new competitiveness priorities. They serve as a dynamic bridge between the EU’s vast research ecosystem and the marketplace. Often, they are the driving force behind breakthrough technologies in areas such as deep tech, climate innovation, digital transformation, and healthcare. Despite their importance, the EU’s research and innovation frameworks have traditionally underrepresented entrepreneurship, favouring established institutions and large consortia, thereby neglecting early-stage ventures.
FP10 represents a pivotal opportunity to rebalance this equation. By strengthening the European Innovation Council—particularly its Accelerator and Transition programmes—the EU can directly support the scaling up of high-potential start-ups. The new framework is also expected to promote more agile and flexible funding instruments tailored to the realities of early-stage ventures.
The main challenge will be to ensure that these new opportunities reach all parts of Europe. There are significant disparities across the continent: some regions have well-developed innovation ecosystems and are well-positioned to benefit, while others suffer from fragmented stakeholder networks. Promoting cooperation among actors in less-developed regions and fostering cross-border collaboration will be essential to ensure that entrepreneurs from all regions benefit from the new EU opportunities provided by the Multiannual Financial Framework.
