The European Commission on Monday announced that a new startup investment programme will be supported with €2 billion in funding, according, Research, Science and Innovation Commissioner, Carlos Moedas, who also pointed out that this is the first time the EU executive has taken direct steps to directly invest in the private sector.

The pilot project which started on 18 March, means that the European Commission can “enter the capital of companies, buy shares of the company and become a shareholder,” according to Moedas. “This has a great advantage. If this innovation works then we can also receive the value of these actions, which will increase. By receiving that money, we can finance other projects that could not be financed if we only had scholarships.”

In order to enter into the structure of the companies, the European Commission will create, together with the European Investment Bank and the European Investment Fund, an entity known as the European Innovation Council to make the investments.

“We have not yet defined exactly how we are going to enter into the capital of companies, but we do not want to be a typical shareholder. It will be a percentage to help the company and to attract other investors,” added the Commissioner.

Entrepreneurs and companies that want support from the council can submit their applications during the pilot phase until 2020.