Traditionally, start-ups and small and medium-sized enterprises (SMEs) in the EU have faced difficulties in commercially exploiting their innovations. Many innovations with commercial potential have failed to make the transition from the laboratory to the marketplace. This may partly be due to a gap in funding: both fundamental and applied research are usually supported through public (including EU) money, whereas the market phase tends to be funded privately. However, it is in the transition between these two phases that most innovation projects have faltered. The aim of the “SME instrument” is to develop and capitalise on the innovation potential of SMEs by filling the gap in funding for early-stage, high-risk research and innovation, boosting innovation and increasing private-sector commercialisation of research results.
The European Court of Auditors is conducting an audit on whether the SME instrument actually supports innovation by SMEs as intended. In particular, we will examine its design, monitoring and follow-up, and whether the Commission has taken action to address the challenges facing SMEs with a high potential for innovation. The audit will also examine complementarities between the SME instrument and other EU and national programmes, as well as other support the instrument provides in the form of coaching, networking and other assistance to help leverage further investment.
Audit preview: EU Support for SME Innovation: The SME Instrument