Library FAQ
Who manages monitoring and follow-up for individual EIC Fund investments?
The External AIFM manages individual investments, including monitoring and acting on milestone funding, financing events (conversions, follow-on, etc.), write-downs and restructurings, exits, and related matters.
Will the EIC Fund connect Final Recipients with mentors?
Yes. With the recipient’s consent, the EIC Fund will put the Final Recipient in contact with its network of mentors (which could include potential investors) to provide advice and recommendations for business development and potential corporate actions. In som...
Are operations with entities in certain jurisdictions prohibited?
Yes. The EIC Fund prohibits entering into new or renewed operations with entities incorporated or established in jurisdictions listed under the Union policy on non-cooperative jurisdictions for tax purposes, identified as high-risk third countries for AML/CTF,...
Can companies receive follow-on investments or investments after a grant-first?
The Commission may award follow-on investments on an ad hoc basis to companies that were awarded an investment component to catalyse additional investors on a matching basis, and may award an investment to companies that were awarded ‘grant first’ support subj...
How are investments managed after signing?
The EIC Fund manages individual investments by monitoring and acting on milestone funding, financing events (conversions, top-ups), write-downs, restructurings, exits, and may appoint qualified EIC Fund representatives or independent experts as board represent...
How does the EIC Fund approach valuation for equity investments?
The EIC Fund will, in general, align its valuation to the valuation set by the market (i.e. by private qualified investors co-investing alongside them) and may use common investor valuation methods such as multiples of earnings (times revenue), fair market val...
How does the EIC Fund handle blocking minority protections in co-investments?
Where awarded support is conditioned on the EIC Fund acquiring a blocking minority, the EIC Fund may opt to substitute a direct blocking minority with a shareholder agreement providing similar guarantees regarding EU interests, and will agree with other shareh...
Is additional technology due diligence required?
Yes. Additional technology due diligence may be required on a case-by-case basis in addition to the systematic technology assessment performed during initial evaluation, potentially to include a more in-depth investor-angle review and involvement of EIC Progra...
What are considered strategic technologies for the EIC Fund?
Strategic technologies include those related to the EIC Accelerator Challenges in the EIC Work Programme, defined as critical technologies and technology roadmaps in the action plan on synergies between civil, defence and space industries (COM(2021)70 final) a...
What are the consequences of non-compliance or breaches identified by the EIC Fund?
Non-compliance issues may lead the EIC Fund to recommend termination or cancellation of support; the breach of obligations at any stage may lead to interruption, cessation or cancellation of EIC Accelerator support and recovery of amounts paid where fraud is d...
What are the main steps in investment implementation by the EIC Fund?
Investment implementation includes identifying the most appropriate financing structure, negotiating investment terms, assessing availability of third-party financing, closing final legal documents (including the investment agreement), providing information to...
What compliance and due diligence checks does the EIC Fund perform?
The EIC Fund performs compliance and due diligence checks related to KYC, anti-money laundering (AML), anti-terrorism financing, tax avoidance, non-compliant/non-cooperative jurisdictions, sanctions, and other standard compliance rules; checks extend to shareh...
What financial and commercial aspects does the due diligence process focus on?
Financial and commercial due diligence focuses on governance and quality of management, capital structure and financial planning, business strategy, competition, market assessment, value creation, and legal form and jurisdictions.
What is Bucket 2 (Co-investment opportunities identified)?
Bucket 2 includes cases where potential investors show immediate interest in co-investing into EIC selected companies, with the EIC Fund seeking that its equity is at least matched by other qualified investors covering at least 50% of the round and an objectiv...
What is Bucket 3 (Alternate investment opportunities)?
Bucket 3 includes cases where potential investors show immediate interest in providing the full investment into EIC candidate companies; the EIC Fund may still co-invest to secure a blocking minority, particularly for strategic technologies, and may reserve pa...
What is the ceiling for ‘grant first’ support for pre-TRL 9 activities?
Where initially requested by the beneficiary, ‘grant first’ support for pre-TRL 9 activities cannot exceed EUR 2.5 million, except that in the case of a full blended finance request the grant component may exceed that ceiling where duly justified.
What is the typical duration and exit strategy for EIC Fund investments?
The EIC Fund invests patient capital with a long average perspective on return (7–10 years) and a maximum generally of 15 years; the Fund’s main objective is impact investment while seeking a positive return, and exit routes may include IPOs, management buy-ou...
What may a compliance KYC self-certification be used for?
A compliance KYC self-certification may be collected together with the full accelerator proposal, but it will not be considered during the evaluation and will only be reviewed by the EIC Fund where the proposal is retained by the Commission.
What types of financial instruments does the EIC Fund prioritize?
The EIC Fund will, in priority, use equity or quasi-equity investments, including common shares, preferred shares, convertible instruments (convertible loans/bonds/notes, participation rights, SAFEs) and other equity-type instruments appropriate to achieve the...
When are compliance and KYC checks performed?
Compliance and KYC checks are performed prior to the initial investment and prior to possible follow-on investments.
Who negotiates terms with potential co-investors on behalf of the EIC Fund?
On behalf of the EIC Fund, the Investment Advisor will negotiate the terms with potential co-investors, including possible mentoring tasks.
Will the EIC connect companies with mentors?
Yes. With the company’s consent, the EIC will connect the company to its network of mentors, which could include potential investors, to provide advice and recommendations for business development and potential corporate actions; in some cases, such as Bucket...
Can the Compartment substitute a blocking minority with other protections in Bucket 2?
Yes—where the award conditioned acquisition of a blocking minority, the EIC Fund may opt to substitute a direct blocking minority with a shareholder agreement providing similar guarantees regarding European interests.
How are transactions categorised and can the category change?
The Adviser classifies transactions into buckets (0–3) after initial assessment; this classification is not static and can change as due diligence evolves or co-investment interest emerges.