Europeans in technology tend to venerate Silicon Valley as the epicenter of innovation, believing that it’s where they need to be if they hope to be successful. Why do we do that?

When we look at programs like Horizon 2020, which is putting €80 billion into research and innovation, and its proposed successor, the €100 billion Horizon Europe, there is plenty going on here to make a significant impact. Consider the European Processor Initiative (EPI), which is part of a European Commission-funded program to support the creation of a world-class European high-performance ecosystem built on two of the world’s top three exascale-computing machines.

The EPI has already completed its first year and announced details of a new common software platform for heterogeneous compute environments. The effort, a collaboration among 27 partners from 10 countries, plans to fabricate the first of its Rhea chips — based on Arm, RISC-V, embedded FPGA, cryptography elements, and other tiles — in an advanced N6 technology aimed at the highest processing capabilities and energy efficiency.

Such research opens up the opportunity for European companies to lead the way in high-performance computing, with innovative solutions to address the big challenges in the era of advanced connectivity with 5G and intelligent systems. There’s no lack of innovation here in this respect.

Much of the iPhone’s technology originated from government-funded research.
(Image: “The Entrepreneurial State,” Penguin Books, 2018)

But there is a difference between Europe and Silicon Valley. We all think Silicon Valley is one of the world’s top innovation ecosystems. Drill down, however, and you’ll find its success is less about the innovation than about the innovators’ ability to capitalize on leading-edge research, much of it government-funded. Mariana Mazzucato, a professor in the economics of innovation and public value at University College London, underscores this fact in her book “The Entrepreneurial State: Debunking Public vs. Private Sector Myths.”

Mazzucato argues that the private sector typically invests in an innovation only after the government has made the initial, high-risk investment. She uses the iPod and the iPhone as examples to illustrate the public roots of much of the products’ innovative technology.

Other examples include Google, whose search algorithm was a result of support from the U.S. National Science Foundation (NSF), and Tesla, which is said to have gotten its boost from a US$465 million loan from the U.S. Department of Energy. Then there’s the help Qualcomm got from the Small Business Innovation Research (SBIR) program, which provided Qualcomm’s first US$1.5 million grant — funded through the U.S. Defense Department and NSF — to develop its first chips based on CDMA technology.

What the U.S. experience teaches us is that while companies like Apple, Tesla, and Google certainly have brought great products and solutions to market, they’ve done so by building upon state-funded research and support. They’ve focused not just on the innovation itself, but on the commercial opportunity that the innovation could enable.

Europe does not lack for innovations or state-funded research into leading-edge technologies. This fact has to be applauded — and we don’t do enough of that. But beyond the innovation, there needs to be more focus on how to make an impact and enable the research projects to take life.

In the U.S., programs like SBIR often provide ideas with the kick-start they need to land first customers and funding. Europe is already good at research and innovation, but we need to do better at systematically and consistently commercializing that work, nurturing spinouts and fostering a culture of big ambitions.

If we can do that, then our innovators will easily be a match for Silicon Valley’s world-leading tech companies.