Europe is betting €525 million on chip design start-ups

Published on 5 November 2026 - 11:19 GMT+1

Europe is hoping it can spur a new generation of European chip design companies with a €525 million bet on start-ups.

The European Commission announced the European Chip Design Platform on Wednesday, which aims to offer early-stage firms design tools, access to intellectual property and manufacturing, and grants of up to €16 million.

Chip design is a core stage of the semiconductor value chain and the place where much of the industry’s innovation emerges. Yet European firms currently generate less than 1% of global revenues in this segment, the Commission said.

EU officials say this undermines the bloc’s wider chip strategy: new manufacturing capacity in Europe will only be sustainable if there is enough demand for it, and much of that demand has to come from European designers.

Officials say the stakes go beyond start-ups: new European factories will only pay off if European designers supply the demand.

“The European Design Platform gives our chip start-ups and SMEs the support they need to overcome the barriers to turn their innovative ideas into silicon,” said Henna Virkkunen, the European Commission’s Executive Vice-President for Tech Sovereignty, Security and Democracy.

“It shows how Europe is ready to act on its technological sovereignty goals, not only through policy and promises, but also by investing in our future,” she added.

Europe’s position in the global chip industry has been under pressure for several years.

The Chips Act was designed to lift the EU to a 20% share of global semiconductor production by 2030, up from a base of around 9% in 2020. But in a 2025 report, the European Court of Auditors concluded that the target is very unlikely to be met.

Meanwhile, chip capacity is concentrated to just a handful of companies.

Taiwanese company, TSMC, now makes about seven in every ten of the chips produced for other firms. The most advanced chips, the kind that power AI and the latest smartphones, are made almost entirely in Taiwan and South Korea. The US, Europe and Japan are all trying to build their own capacity to reduce that dependence.

Supporters of the Chips Act argue it has helped reverse a long decline. A Commission official has said it laid a strong foundation and put Europe back on a path for growth after two decades of decline.

The design platform aims to build European demand and know-how at the start of the value chain rather than competing only on factory capacity.

It comes as part of the EU Chips Act, which aims to reinforce the bloc’s semiconductor ecosystem, make supply chains more resilient and reduce external dependencies.

It sets out five strategic objectives, including building and reinforcing Europe’s design capacity in advanced chips. Setting up a European Chip Design Platform through the Chips Joint Undertaking is a core component of the Act.