The report reveals the crucial role of private equity and venture capital in driving innovation through intellectual property (IP). The report, ‘Protecting European Innovation: Private Equity’s Role in European Intellectual Property Rights’, demonstrates the essential role private equity plays in driving innovation and the development of new technologies and services, contributing to Europe’s economic growth and competitiveness.
It analysed over 56 000 portfolio companies and over 100 000 trade mark and patent filings across Europe between 2007 and end-June 2023. A total of EUR 809 billion was invested in EU27 companies over the period, with 20 % of investment in companies with patents and 39 % in businesses with trade marks.
The findings highlight the strong connection between private capital investment and the growth of IP assets. A 100 % increase in private investment correlates with a 10 % rise in trade mark and patent filings, reinforcing the role of financial support in fostering innovation. This aligns with EU goals to boost innovation, by targeting companies that already have a history of trade marking and patenting, and by giving them the tools to develop innovative products and services that increase business competitiveness and add value to economies.
Key Report Highlights:
- Companies with pre-existing trade marks received significantly more investment: 55 % more at the venture stage, 45 % at the growth stage and 68 % at the buyout stage.
- The Biotech and Healthcare sectors led in innovation, with over two patent filings per company, reflecting ongoing discoveries in life-saving technologies.
The report demonstrates that private equity and venture capital companies not only recognise the value of IP protection but actively seek out companies with strong IP portfolios, giving these businesses a competitive edge. As João Negrão, Executive Director of EUIPO, stated, ‘Our collaborative study reveals the undeniable importance of IP rights in shaping a company's future and its appeal to investors. It can be a deciding factor when it comes to venture and equity funds supporting European companies. We aim to encourage the finance world to see IP as valuable intangible assets, indispensable to EU innovation and growth.’
Invest Europe CEO Eric de Montgolfier echoed this sentiment, emphasising that innovation is at the heart of economic growth. ‘Innovation is at the beating heart of successful companies, and by extension the lifeblood of growing economies. Breakthrough innovations are emerging around the world and Europe has the ingredients to lead: world-class research, global companies and a wealth of entrepreneurial talent. With its ability to help companies develop and commercialise innovation, private equity and venture capital can offer a key to unlock many of the challenges Europe faces,’ he noted.
Read the joint report to learn more about the essential role of IP in European business strategies and the growing recognition that IP assets are crucial for sustained economic development.
More information:
- Download full report ‘Protecting European Innovation: Private Equity’s Role in European Intellectual Property Rights’
- Download the executive summary