On 15 April 2021, the EIF organised a virtual debate to discuss the importance of small and medium-sized enterprises (SMEs) for the European economy and society and the need for them to be at the heart of Europe's industrial and digital strategies.
The debate, co-hosted by MEP and EIF Programming Committee Co-Chair Ivan Štefanec and MEP Josianne Cutajar, was moderated by EIF Director General Maria Rosa Gibellini and featured the following speakers:
- Hubert Gambs, Deputy Director-General, DG GROW, European Commission
- Dr. Oliver Grün, Founder and CEO of Grün Software, President of German Federal Association of IT-SMEs (BITMi) and European DIGITAL SME Alliance
- Ruben Bonet, Co-founder, President and CEO, Fractus
- Fabrizio Morgera, Senior Investment Officer, European Investment Bank
- Sjoerd Hauptmeijer, CEO & Founder, The Young Digitals
Ivan Štefanec MEP set the scene reiterating the important role of SMEs in Europe’s digital transformation. Before the pandemic, European small businesses employed 2/3 of the European workforce; today, more than a half of them face bankruptcy. According to the MEP, SMEs need quick access to finance, a delay in taxes and a reduction of bureaucratic burden, all points that can be improved via digitalisation.
MEP Štefanec is glad that the digital transformation of businesses is significantly addressed in Europe’s Digital Decade by the European Commission, where very ambitious but also reachable targets for businesses are presented. The MEP believes that the digital transformation of SMEs is crucial for the whole European economy recovery.
Hubert Gambs focused on the new SME strategy, striving to become the reference tool for making SMEs more digital, sustainable and resilient. The digitalisation of SMEs, assured Mr. Gambs, is one of the most crucial policy objectives of the European Commission supporting this via the local European Digital Innovation Hubs, the Digital Volunteering Programme or the EU Startup Nations Standard.
Furthermore, the European Commission is pushing Member States to address the priorities of SMEs in their reform plans: not only the SME network, but also stakeholders and the European Parliament should encourage Member States to set the right priorities.
Dr. Oliver Grün underlined the importance of looking at the role of SMEs in the digitalisation process, which not only involves optimisation of already-existing processes, but also inventing new digital business models. A lot of digital future projects and new digital business models are postponed because of Covid; according to Mr. Grün, we must maintain the digital sovereignty in Europe, working fully on the European Commission’s targets.
Moreover, if Europe wants to double the number of unicorns by 2030, we need to be more ambitious and define goals for 2025, and focus on scale-ups as well. “Europe's innovative SME-base will allow us to reach the targets.”
Ruben Bonet brought to the stage the story and example of his company, Fractus. He focused on the relevance of IP for global competition and SMEs, start-ups and scale-ups, fundamental to further foster European innovation and competitiveness at the global scale.
Europe clearly needs more SMEs and more scale-ups that can efficiently compete in the international market place, asserted Mr. Bonet.
From an SME perspective, a strong patent system will support innovation and R&D investment; private funds will continue investing in innovative SMEs and technologies, provided that their IP protection is strong.
Fabrizio Morgera shared with the audience the actions taken by the European Investment Bank in the SMEs sector, in particular the Venture Dept tool financing the growth stage of innovative companies through an equity strategy.
According to Mr. Morgera, we need to create a corporate culture amongst SMEs and this is the key differentiating factor, especially between Europe and the US: the US in fact deploy much more capital than Europe in growth equity deals. Even if there is a big effort in Europe, we are not deploying enough money into the system in order to enhance the SMEs to grow and to compete at international level.
Sjoerd Hauptmeijer shared the story of his social enterprise The Young Digitals, supporting Europe digital transformation by unlocking the potential of young people without a diploma and contributing to the advancement of digital skills of employees in Europe.
The Young Digitals has developed an 18-month programme for 18- to 27-year-olds to strengthen their digital skills by providing valuable work experience. These young people can play an important role in digital transformation of SMEs, assured Mr. Hauptmeijer; “we are delighted that many corporates support our mission and open up to these young people without a degree.”
Josianne Cutajar MEP welcomes the digital compass proposed by the European Commission setting quantitative targets and giving a sense of urgency to grasp the opportunities that the digital transition offers. Investing to digitalise SMEs is crucial as it is the collaboration amongst SMEs and “to keep thinking small first.”
The MEP stressed the importance of the local economic ecosystems at the centre of the digital transition: for the same reason, she also welcomes the European Digital Innovation Hubs initiative. According to Ms. Cutajar, the strong link between digitalisation and local ecosystems will also result in positive externalities for the territorial cohesion of the European Union and contribute to the goals of the Green Deal.