European Innovation Act Proposes EU-Wide IP Valuation Framework to Help Deep-Tech Startups Secure Funding

Europe has a growing pool of patents, scientific discoveries and advanced technologies, but turning those assets into investable businesses remains a challenge for many startups. A new proposal from the European Commission aims to address that gap by making intellectual property easier to value, commercialise and use to attract financing.

The proposed European Innovation Act, unveiled in September 2026, includes plans for a European Union-wide intellectual property valuation framework, a digital marketplace for intellectual property transactions and a dedicated support function within the European Union Intellectual Property Office (EUIPO).

The initiative is designed to help innovative companies, particularly deep-tech startups and small businesses, use patents and other intellectual assets more effectively when seeking investment. It also forms part of the EU’s wider effort to strengthen its innovation ecosystem and help more European technologies reach commercial markets.

The proposal is not yet a fully implemented, EU-wide financing system. Its impact will depend on the legislative process, the final rules and how effectively investors, lenders and innovators adopt the new mechanisms.

Why Intellectual Property Is Difficult to Turn Into Funding

For many technology startups, the most valuable assets are not factories, buildings or equipment. They are patents, proprietary technologies, software, technical know-how and research results.

These assets can underpin products in areas such as advanced materials, biotechnology, robotics, semiconductors, clean energy and artificial intelligence. However, their financial value is often difficult to establish.

A patent may describe a technically promising invention without demonstrating that the invention has a commercially viable market. Its value can depend on the strength of the patent claims, the remaining protection period, competing technologies, potential licensing income, manufacturing costs and the likelihood of successful commercialisation.

This creates a problem when a young company approaches a bank, investor or strategic partner. The business may possess valuable technology but lack the conventional collateral or predictable revenue that financing providers typically seek.

The difficulty is particularly significant for deep-tech companies, which can spend years developing technology before generating substantial commercial revenue.

The European Commission’s proposed approach seeks to make intellectual property assessments more consistent and accessible, helping financial institutions evaluate these assets with greater confidence.

What the European Innovation Act Proposes

The European Commission’s September 2026 proposal addresses two major barriers to commercialising innovation: access to finance and fragmented procedures for research and development procurement.

Its intellectual property measures centre on three connected components.

1. A common framework for valuing intellectual property

The proposal would task EUIPO with developing an EU-wide framework for IP valuation.

The objective is to make the assessment of patents and other intellectual property more consistent and comparable across the European market. Common approaches could help businesses, investors and lenders better understand what an intellectual asset is worth and what risks are associated with it.

Such a framework would not mean that every patent receives a fixed or guaranteed financial value. Valuation would still depend on the characteristics of the asset, its commercial potential and the evidence supporting its use.

Instead, common methods could reduce uncertainty when different parties assess the same technology, potentially making investment discussions and licensing negotiations more efficient.

2. A digital marketplace for intellectual property

The proposal also envisages an EU-wide digital marketplace connecting buyers and sellers of intellectual property.

A marketplace of this kind could make it easier for companies to discover technologies available for licensing, identify potential commercial partners and explore transactions involving patents and other intellectual assets.

For a university spinout or an early-stage engineering company, greater visibility could create opportunities to license a technology rather than build an entire manufacturing and distribution operation independently.

The marketplace could also help businesses find relevant technologies developed by other organisations, supporting collaboration and technology transfer.

Its practical value would depend on participation, the quality of the information provided, confidence in the underlying rights and the ease with which transactions could be completed.

3. A dedicated IP-backed finance competence centre

A third component would establish a competence centre within EUIPO to support IP-backed finance.

The proposed function would help innovators and financial stakeholders understand how intellectual property can be valued and used in financing arrangements. The measures envisaged include advice, training and support for companies seeking to commercialise their intellectual assets.

This could be especially useful for smaller businesses that lack in-house intellectual property specialists or experience negotiating technology-based financing.

The aim is not simply to encourage companies to register more patents. It is to improve their ability to turn existing intellectual assets into commercial opportunities and potential sources of capital.

How IP-Backed Finance Could Work for Deep-Tech Startups

IP-backed finance refers broadly to financing arrangements in which intellectual property contributes to the assessment, structure or security of funding.

Consider a startup developing a new technology for industrial energy storage. The company may hold patents covering a particular battery design or manufacturing process, but it may not yet have enough revenue to qualify for conventional lending on favourable terms.

A more structured valuation could help the company demonstrate the technology’s potential, the scope of its patent protection and possible licensing or commercialisation opportunities.

A lender or investor could then use that information as part of a broader assessment of the company’s prospects and risks.

Depending on the arrangement, intellectual property might contribute to a secured loan, a licensing transaction, an investment decision or a partnership with a larger manufacturer.

However, a patent valuation does not guarantee financing. Investors still need to consider technical performance, market demand, management capability, regulatory requirements, competition and the possibility that the technology may fail commercially.

The proposed EU framework is intended to improve the information and infrastructure supporting these decisions, not remove the financial risks associated with early-stage innovation.

Why Europe Wants to Close the Commercialisation Gap

Europe has substantial research capabilities across universities, public laboratories and industrial research organisations. Yet scientific success does not automatically produce companies that can scale internationally.

Some technologies are licensed to established businesses, while others struggle to attract the funding needed to move from a research environment into commercial production.

Fragmented markets, different financing practices and difficulties assessing intangible assets can make this transition more complicated.

The European Innovation Act is intended to improve conditions across the single market so that promising technologies can move more easily from research to development, investment and commercial deployment.

According to the European Commission, the proposed IP-related measures could help unlock approximately €10.2 billion in additional annual financing through IP-backed venture capital and debt. The Commission also estimates that the measures could generate around €35 million in annual administrative cost savings.

These figures are projections associated with the proposal, not financing already delivered to startups. Their realisation would depend on implementation and market adoption.

The initiative is also linked to the EU’s broader competitiveness agenda, which seeks to strengthen Europe’s capacity to develop and scale strategic technologies rather than relying excessively on external suppliers or allowing promising companies to move elsewhere to grow.

Research and Development Procurement Is Another Part of the Plan

The proposal extends beyond intellectual property valuation.

It also seeks to create a more harmonised approach to research and development procurement, including arrangements that allow public buyers in different EU countries to collaborate on R&D projects.

Public procurement can help create early demand for emerging technologies. Governments and public institutions may need advanced digital systems, energy technologies, medical solutions or other products that are not yet widely available commercially.

More consistent procedures could make it easier for public authorities to work together, reduce uncertainty for participating businesses and support the development of technologies that might otherwise struggle to find an initial customer.

For startups, a successful R&D procurement project can offer more than a contract. It may provide an opportunity to test a technology, generate performance evidence and establish a reference customer.

Nevertheless, procurement reform and IP-backed finance address different problems. One aims to improve access to public R&D opportunities; the other aims to help companies assess and commercialise intellectual assets and obtain financing.

Together, they form part of the Commission’s effort to strengthen the connection between research, investment and market adoption.

What the Proposal Could Mean for Universities and Technology Transfer

Universities and public research institutions often hold patents and other intellectual assets that could support new businesses or licensing agreements.

However, assessing a technology’s commercial value can require specialist expertise, market information and negotiations with potential industry partners.

A more consistent valuation framework and a broader marketplace could help universities and spinouts present their technologies to prospective licensees and investors.

For example, a university research group developing a novel diagnostic technology might seek a commercial partner with the manufacturing capacity, regulatory expertise and distribution network needed to bring the product to market.

A clearer assessment of the intellectual property could help structure those discussions. But a successful transaction would still require evidence that the technology works, that the relevant rights are secure and that there is a viable route to market.

The same principles apply to startups developing quantum technologies, advanced robotics, semiconductor components and other capital-intensive innovations.

What Happens Next?

The European Innovation Act is a legislative proposal rather than a completed framework already operating across the EU.

The final scope, implementation arrangements and practical responsibilities will depend on the legislative process and the provisions ultimately adopted. EUIPO’s role would be shaped by those final requirements.

Businesses should therefore distinguish between the policy direction announced by the Commission and services or financing mechanisms that are already operational.

For startups, the immediate lesson is that intellectual property should be treated as part of a wider commercial strategy. Companies can prepare by maintaining clear ownership records, documenting development work, reviewing patent coverage and gathering evidence of technical and market potential.

For investors and lenders, more consistent valuation methods could eventually improve the information available when assessing technology-driven businesses. Whether that translates into more financing will depend on the willingness of financial institutions to accept IP-related risks and the availability of reliable evidence about the assets involved.

A Shift From Protecting Ideas to Financing Innovation

The proposed European Innovation Act reflects a broader policy shift: intellectual property is being considered not only as a legal mechanism for protecting inventions, but also as an asset that can help businesses grow.

Patents alone do not create successful companies. Their economic value depends on whether an invention can be developed, manufactured, licensed or adopted by customers.

By proposing common valuation methods, a digital marketplace and specialised support through EUIPO, the European Commission aims to make that process more accessible across the single market.

If implemented effectively, the framework could help reduce some of the barriers that prevent deep-tech startups from converting research into commercial opportunities.

The decisive test, however, will be whether the new system gives investors and lenders enough confidence to finance promising technologies—and enables more European innovators to scale their businesses without losing momentum between discovery and commercialisation.

Frequently Asked Questions

1. What is the European Innovation Act?

The European Innovation Act is a European Commission legislative proposal introduced in September 2026. It aims to help innovative businesses move from research to commercial markets through measures covering intellectual property valuation, IP-backed finance and research and development procurement.

2. What is an EU-wide intellectual property valuation framework?

It is a proposed common approach to assessing the value of intellectual property across the EU. It is intended to make valuations more consistent and help businesses, investors and lenders assess patents and other intangible assets.

3. How could the proposal help deep-tech startups secure funding?

More consistent valuations, improved access to potential IP buyers and licensing partners, and specialised support could help startups explain the value of their technologies to financial institutions. Funding would still depend on commercial prospects, risk and the terms offered by investors or lenders.

4. What role would EUIPO play under the proposal?

The European Union Intellectual Property Office would be tasked with developing the proposed valuation framework and digital marketplace and establishing a competence centre to support IP-backed finance, subject to the final legislation.

5. Has the European Innovation Act already created a functioning EU-wide IP financing system?

No. The proposal outlines the intended framework, but the final legislation and implementation arrangements determine how and when its measures become operational.