Today (26 April 2024) the European Patent Office (EPO) and the European Investment Bank (EIB) published an in-depth (and very lengthy) report on financing and commercialisation of cleantech. [For those with less time than the 85 pages of the full report, there is an executive summary!]
Why is this report so interesting?
Some of the findings are perhaps not completely surprising. More startups and small cleantech companies consider patents to be vital compared to larger companies. We already knew that start-ups and small companies need funding and funders want to see IP protecting their most valuable asset, didn’t we? Sure but now we have numbers and data to back up these pseudo-anecdotal conclusions.
More than that though, what the data says is nuanced and interesting. It shows where trends and pitfalls lie and how these differ for different sizes and locations of the business. These findings can help understand and solve the issues faced in developing and then realising the full commercial potential of cleantech in Europe (and beyond).
Collaboration, Obstacles and Support
The report looks at all of these in detail, broken down by sector and location. It highlights that cleantech in Europe has a strong research base but cleantech companies face higher financing constraints than other innovator companies. It also clearly shows that VC investment in Europe as a proportion of the overall VC spend is significantly higher than in the US.
Collaboration on the development of cleantech is common with over 30% of technologies reported to be the result of collaboration.
Asked what can be done to support them, small cleantech companies favour faster access to funding and larger cleantech companies want consistent regulation (which the report flags as an important aspect of the EU market). Perhaps this reflects the different pitfalls for these different types of company – large companies do not have the same struggle to finance development but when they get to product design and development, their commercial success is dependent on a changing regulatory environment.
The Role of IP
Promisingly, the report shows clear upward trends in innovation in cleantech through patent filing data. The report is clear that patents overall support the commercialisation of cleantech.
Over 90% of start-up and small companies surveyed in Europe agreed that investors pay attention to IP. Interestingly, although not the major factor for any cleantech company, all types and sizes of cleantech company cited advice on IP strategy and management as a preferred type of support.
Summary
The report highlights that innovation, IP, funding and clear regulation are needed for cleantech to realise its full potential. Like the IP, the innovation and funding need to be the right kind at the right time. The report provides insight into what kind of innovation and funding are needed to tackle various technical challenges associated with reaching a more sustainable future.
