New strategy to support European startups and scaleups

About the strategy

European startups and scaleups as strategic drivers of the EU’s competitiveness. The strategy recognises however several challenges that small businesses face while competing on the global market, such as access to capital, lower investor interest due to risks, market fragmentation, regulatory hurdles and skills shortages. Innovative European companies are also often trapped in the so-called ‘two valleys of death’ in which innovations fail before becoming marketable products or cannot pass the growth stage.

The strategy puts forward a structural shift towards a more entrepreneurial and innovative economy model which would help in keeping high-potential scaleups in Europe. The proposed measures aim for innovation-friendly regulation, better finance, fast market uptake and expansion, support for the best talent, as well as access to infrastructure, networks and services. Some of the actions listed in the strategy are:

• Simplify rules for setting up a business; reduce regulatory burdens in strategic sectors (including biotech); propose pro-innovation procurement reforms and clarify state aid rules for infrastructure use.
• Launch the European Innovation Act, including regulatory sandboxes; expand and simplify the European Innovation Council; and establish a European Innovation Investment Pact.
• Revise the standardisation regulation to speed up standards development; develop a framework for IP valuation and IP-backed financing; review rules on ‘undertaking in difficulty’ to better support fast-growing startups.
• Launch a “Lab to Unicorn” initiative to commercialise research; establish a European Corporate Network to connect startups with large companies; develop a Charter of Access for research and tech infrastructure; launch the Blue Carpet Initiative to attract/retain EU and non-EU talent.  

Addressing the bio-based sector’s needs

Many of the startups and scaleups challenges addressed in the strategy were the focus of the discussion at the last CBE JU Stakeholder Forum. The shift from fossil-based to bio-based production and consumption requires consistency in legislation and policy objectives, supportive industrial regulation, access to finance, and adapted standardisation, concluded the forum’s participants.

The actions proposed in the strategy are good news for small and medium businesses constituting 35% of the 3,109 participants in CBE JU-funded projects. Currently, SMEs coordinate 17% of all CBE JU projects and receive 30% of all funding. Many of them are indeed developing and scaling up technologies and business models driving Europe’s bio-based innovation and transforming a variety of sectors, such as chemicals, food, feed, materials, engineering, construction, waste processing, recycling, plastics packaging, agriculture and aquaculture.

Take a look at some CBE JU-funded projects lead by innovative small businesses:

This year, SUSTAINEXT started the construction of a flagship biorefinery, located in Hervas, Spain. The project, led by the Spanish SME Natac, is transforming an existing facility into a digital, circular biorefinery that will extract high-value ingredients from locally sourced medicinal and aromatic plants, as well as agricultural sidestreams. Its products will serve multiple sectors, including food and feed, cosmetics, chemicals, and bio-based fertilisers. SUSTAINEXT is set to generate skilled employment, create new business opportunities, and add value to the region, offering a model for sustainable development and rural competitiveness across Europe. 

Leading the CBE JU-funded OLEAF4VALUE and SUSTAINEXT projects has been transformative for Natac. These projects have significantly strengthened our position at the forefront of the botanical extracts and bio-based industries, proving that a sustainability-driven model can also be commercially viable and scalable.

José María Pinilla Rosas, Head of Project Management at Natac 

The AFTERBIOCHEM project has built a first-of-its-kind biorefinery in Saint-Avold, France. The facility transforms sugar industry residues and other non-food agricultural biomass into seven high-value bio-based organic acids used in fragrances, flavourings, personal care products, food, feed, and industrial chemicals, as well as a potassium-rich fertiliser. The project has created 80 direct and 200 indirect industrial jobs in the Moselle region, as well as set up a sustainable bioeconomy value chain in Europe with a potential to cut 30kT of CO2 emissions per year.  

It was a great opportunity for us to coordinate such a large consortium of outstanding companies with a focus on bioeconomy. We are really proud of the consortium’s achievements; we are determined to make this a durable industrial success.

Nicolas Sordet, CEO of Afyren leading the AFTERBIOCHEM project 

The SWEETWOODS project has built a pioneering flagship biorefinery in Estonia, designed to optimise wood utilisation and enhance its value in line with sustainable forest management practices. This first-of-its-kind facility converts at least 90% of the wood feedstock into functional bio-based chemicals at industrial scale. The biorefinery is part of a new industry that is advancing an innovation hub in Estonia focused on forestry‑based chemicals and materials. 

The bioeconomy can only thrive if public and private sectors work together. With the SWEETWOODS project, supported by CBE JU, we’ve shown what’s possible when collaboration meets innovation. Getting a first-of-its-kind biorefinery up and running is just the beginning — now we need more real examples, and a shared commitment to help them scale. That means a shift in mindset and in regulations, so the bioeconomy becomes a core part of how materials and chemicals are made.

Peep Pitk, Chief Development Officer at Fibenol leading the SWEETWOODS project