Vilnius, capital of the Baltic state of Lithuania, has just finished hosting ICT 2013, a three-day event dedicated to the potential role of information and communication technology (ICT) in solving Europe’s societal challenges. Organised by the European Commission in partnership with Lithuania, current holder of the six-month rotating Presidency of the Council of the European Union (EU), the combined conference/exhibition/cultural display carried the poster headline: Create – Connect – Grow.
As an event designed to ‘Connect’, this was pitched at the highest political level – linking up Lithuania to its fellow EU member states. From the ICT 2013 reception desk at Vilnius airport, ready with limos to whisk VIPs straight to the Litexpo venue, or from the airport bus stop with its especially branded map to guide more humble visitors, all signs in Vilnius pointed to this Presidential event.
Over 5,000 visitors attended. Over 150 exhibition stands, manned by start-ups, university departments and research quangos, had their wares on display. One visitor called it an ‘old -fashioned way to do things – like in the 1990’s’, but the offerings ranged from graphene, to rare-earth-coated fibres, to underwater Internet-of-Things – a showcase of some of Europe’s latest and best technology. Wavering between the futuristic and the pragmatic, even as straightforward as dealing with the problem of old people falling over, it might be forgiven, even, for seeming brightly idealistic: Vilnius, in its architecture, shows its past tussles with ideology where Soviet, factory-style buildings sit side-by-side with Milanese baroque.
Hall 4 of the Litexpo venue hosted the Entrepreneurship and Investment Forum (Hall 2 was the Student’s Corner, Hall 1 for networking, while the Lithuanian Village was a satellite spinning off the Welcome Dome). Here, in Hall 4, start-ups pitched to an audience of investors. The most uncomfortable question was always “What is your value?”, and the answer typically, “Let’s discuss it in private”. It is a question that falls under the ‘Grow’ part of ICT 2013’s headline: a start-up valuation, to be equitable, has to price in some shared view on growth projections. The winning pitch – chosen by a panel of investors and awarded a prize – was CGTrader, an online marketplace for 3D computer graphic models. Based in Vilnius and backed by local seed fund Practica Capital, CGTrader must have tickled the judges with its potential to expand its marketplace in order to take advantage of the predicted growth in 3D printing.
Khalil Rouhana, director in DG CONNECT (the European Commission Directorate General for Communications Networks, Content & Technology), was impressed by the pitches and, more widely, by the dialogue apparent between investors and companies. The European Commission would continue to facilitate that dialogue, said Rouhana, in order to help create “a more dynamic ecosystem.” Discussing what EU policies and measures were needed for longer term strategic investment in ICT, he explained that he thought in terms of a complete value chain: “The creation of a pool of investors is key, because the difficulty lies in finding the right investor, with the money, expertise and network, at the right point in the value chain.”
The European Investment Bank (EIB), represented by economist Jussi Hatonen, was also on hand at Litexpo. He set out what funding the EIB and EIF provide to help sustain small and medium sized business (SMEs) and mid-cap companies through not just one, but even two ‘valleys of death’, at times in the financing progression when private or corporate funds might be running low. One of the new co-investment instruments, approved in June 2013, allows the EIB to provide direct, debt financing of between EUR 7.5 m and EUR 25m to support up to 50% of companies’ European research, development and innovation (RDI) investments.
In a final brainstorming session, to consider what policy initiatives Rouhana should take back with him to Brussels, Xiaoquon Clever, president of SAP Labs China, pointed out that investment in infrastructure innovation “must be driven by a higher constitution”, as the return on investment stretched beyond ten years, challenging the private sector’s capacity to survive and make an annual return. And at a more technical level, a delegate from Israel pointed out that in his country, it was worth noting that an equity investment by an angel investor in a start-up was treated as an expense, and so was 100% tax-deductible: only Singapore (now 100% tax-deductible) and Turkey (75%), currently compete with Israel – the most successful start-up ecosystem outside of Silicon Valley – on that level tax of break.
On the midnight flight out of Vilnius, I find myself next to Dr Camille Baker, Canadian citizen and lecturer in Broadcast Media Design at Brunel University in the UK. She has been present at Litexpo as the leader of an EU-funded project to connect up artists with scientists: one of her projects involves an artist interested in dreams, working with brain-monitoring technology. She pulls down her eye mask to catch some sleep, but neatly, this fits with ‘Create’.