Start-ups in Europe’s mining and critical raw materials sectors are underfunded, agreed speakers at the EIT RawMaterials Summit.
EU Commissioner Jessika Roswall opened the second day by addressing “fragmentation” in Europe’s raw materials market and the need for a single capital market – a call that was echoed by Bernd Schäfer, CEO of EIT RawMaterials, which provides funding and support to start-ups across the continent.
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“We must make sure that we follow up with public financing to bring start-ups to market and avoid mushrooming of more of the same innovations but standardise them,” he stated.
Roswall, EU Commissioner for Environment, Water Resilience and a Competitive Circular Economy, confirmed that the EU is working to simplify its funding and grant processes, which present a barrier to smaller companies looking to gain a foothold in the mining sector.
On a panel called ‘Crossing the Valley of Death: Europe’s Raw Materials Start-up Ecosystem’, Ella Cullen, co-founder and CMO of Minespider, a Berlin-based start-up that offers a blockchain-based traceability platform for the mining industry, echoed the call for less fragmentation in the region.
“It is an absolute struggle for start-ups to operate with all the different languages and legal implications of each country and bureaucracy,” stated Cullen.
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By GlobalDataMinespider has received several grants, some from the EIT RawMaterials Booster Programme, and work across around €30m ($33.54m) of EU funded projects, she added.
Investment challenges for mining start-ups
EIT RawMaterials access to finance director Anthony Slotboom agreed that a single capital market is crucial for start-ups. “There has been talk of this for ten years. For someone willing to take a risk in raw materials, there would be a much bigger pool from which start-ups could access capital more easily.”
Benedikt Sobotka, CEO of Alpha Future Funds and former CEO of Eurasian Resources Group, asserted that the private investment landscape isn’t much better.
“Predominantly, mining technology start-ups, such as [those] in geospatial data analysis, are privately funded outside of Europe,” Sobotka said, noting that the investment ecosystem is much smaller than in the US.
“Such companies grow and scale so much faster there [in the US] and the possibility for a significant exit is better than in Europe. This is because there are large buyers and an IPO [initial public offering] market, which in Europe for new technology companies is comparatively dead,” he said.
Beyond offering a single product, scalability to take advantage of the global nature of the mining industry was proffered as a key strategy for start-ups, with mining software solutions highlighted as a particularly promising area to attract private investors and secure public funding.
The EIT RawMaterials Summit is taking place from 13–15 May in Brussels, Belgium. Day one of the summit (14 May) saw industry leaders highlight the need to improve public perception to boost critical minerals development in Europe.
