IP-backed financing could mobilise between €30 billion and €120 billion in new financing every year, according to a new report published by EUIPO.

This equates to between 150 billion and €580 billion in financing over 10 years, with a potential cumulative impact on EU GDP of between €70 billion and €750 billion (0.4% to 4.2% of EU GDP).

Five priority areas

The report says that addressing the IP-backed finance cycle requires coordinated action across five priority areas: make IP visible, assign credible value to IP, leverage IP value for lending, build the evidence base, and reinforce coordination among the various actors.

Measures that it proposes to improve access to bank financing, strengthen IP valuation and expand financing options include:

• Businesses should develop a strong IP portfolio and enhance their IP management and business planning capabilities before seeking financing.
• IP valuation needs to be reinforced so that IP can be assessed more accurately and with greater confidence by financial institutions. 
• The entire IP financing journey should be taken into account to build a more coherent, effective and scalable financing ecosystem.

The report finds that while the EU excels in research, entrepreneurial talent and generating innovative ideas, it lags behind in commercialising them.

In particular, IP rights have become central to the value of innovative firms, but remain largely underused as a source of financing.

According to the report, the EU-US GDP gap expanded from 17% in 2002 to 30% in 2022 and only four of the world’s top 50 technology companies are European. Between 2016 and 2025, Europe consistently saw more founders’ start-ups than the US, but the constraint was the ability to finance commercialization and scale-up.

Unlocking capital 

“Given that intellectual property assets now account for a growing share of corporate value, it is imperative to ensure an appropriate financial environment for the business sector, particularly for innovative SMEs, start-ups and scale-ups, so that they can bring their ideas and IP assets to market”, said EUIPO Executive Director João Negrão in a statement.

Nathalie Berger, Director for Competitiveness Coordination at the European Commission’s Directorate-General for Internal Market, Industry, Entrepreneurship and SME, added: “Policy momentum is now building: initiatives such as the Competitiveness Compass, the post-Draghi agenda and the future European Competitiveness Fund all call for mechanisms to unlock capital for technology-driven companies. Europe must ensure its financial system better recognises the latent potential in IP assets and IP-backed finance can play a decisive role in this endeavour.”

You can find the full report, executive summary, country fiches, press release, Q&A and infographics on EUIPO’s website here.