Unicorns want $118 billion sovereign tech fund

A number of Europe’s largest contenders in the tech industry are calling for a 100 billion-euro ($118 billion) fund to sponsor the emergence of regional champions in green technology, science-driven startups and other new industries.

The execs of about 35 unicorns and startups including Blablacar, FacilityLive and Cabify will call for the European Sovereign Tech Fund at a virtual meeting with the European Union’s Research and Innovation Commissioner Mariya Gabriel on Tuesday. Adyen NV, Collibra SA and Supercell are also expected to take part in the meeting.

The size and influence of the world’s biggest tech companies makes it too easy for them to acquire potential disruptors, monopolize industries and dominate the digital agenda, the founders stated in their publication. “This presents a risk to growth, jobs and Europe’s influence in key strategic areas,” they added.

The fund is expected to draw from both public and private money to form a capital structure that makes long-term equity investments. Some of the founders, as revealed in their publication, have also expressed readiness to invest some of their personal wealth in the fund.

EU officials had lightly considered creating a pan-European sovereign wealth fund to bolster investment in key strategic industries in the past few years, until the pandemic made that plan less of a priority. The latest call come at a time when the EU is shifting from using legislation to curb the reach of U.S. tech giants to supporting home-grown alternatives that can help cut down Europe’s reliance on U.S. and Asian technology.

The bloc is already making equity investments through a 3 billion-euro venture capital fund for early-stage startups that use cutting-edge science and engineering. It’s also putting plans in place to develop and manufacture the world’s most advanced semiconductors by 2030.

The meeting on Tuesday is expected to help put together a Next Innovation EU policy, as the EU looks beyond its role of regulating competition and reducing trade barriers to take a more assertive approach towards the defence of the economic interests of the region.

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