Startups in this domain are uniquely positioned to address pressing global challenges, including food security and climate resilience, by innovating in areas such as plant-based proteins, waste reduction, and sustainable biomaterials. However, the sector's rapid evolution is tempered by significant regulatory hurdles. Companies must navigate a labyrinth of compliance standards and testing protocols, particularly stringent in Europe, where ethical and environmental considerations heavily influence R&D frameworks.

Despite these challenges, Europe offers unparalleled opportunities for agrifood and biomaterials startups. Its ecosystem is bolstered by world-class research institutions like VIB in Belgium and its incubator, biotope by VIB, a highly educated talent pool, and government-backed incentives promoting sustainability-focused innovation. This confluence of factors underscores the sector’s critical role in shaping a more sustainable future while offering substantial growth potential for emerging ventures.

Challenges for biotech startups in Europe

Biotech startups in Europe face numerous challenges, particularly regarding regulatory hurdles and limited resources. These factors make them especially vulnerable to the dreaded ‘Funding Valley of Death’, a development stage where even startups with revolutionary and effective technologies can incur crippling expenses but generate little to no revenue and a long wait until they can expect to do so.

Biotech startups face the particularly high costs of running laboratories and other biotech infrastructure such as bioreactors. In Europe especially, they have to navigate through a labyrinth of standards, rules and testing protocols designed to ensure that their processes are compliant, and their end products are safe for use. While these regulations are essential to ensure that biotech R&D is carried out safely and ethically, they often pose a greater challenge for European biotech startups compared to their counterparts in regions like the US or Asia where ensuring regulatory compliance can take less time and effort than in Europe.

This dynamic leaves startups dependent on grants, early stage VC and strategic investors. However, the significant resources required and the long timelines before potential returns make biotech startups a more challenging proposition to VC investors. As a result, many promising but underfunded startups with innovative technologies struggle to survive.

Opportunities unique to Flanders and Europe

Although Europe’s regulatory environment poses challenges for biotech startups, the continent also offers them unique opportunities.

Europe is home to a dense concentration of world-class academic and research institutions staffed by highly talented engineers and scientists. This proximity enables startups to collaborate on cutting-edge innovations across biotech fields, from cellular agriculture and bioengineering to plant biotechnology and sustainable food ecosystems.

In Flanders, institutions like the Flemish Biotechnology Institute (VIB) exemplify this collaborative ecosystem. By bringing together expertise and state-of-the-art research facilities from multiple regional universities, VIB creates a powerful foundation for advancing biotech innovation.

Access to these institutions is complemented by active efforts by many European governments to aid startups’ development. Biotope’s home city of Ghent, as well as the wider Flanders region, has actively encouraged the cultivation of biotech within its business ecosystem. Ghent is seeking to become a world leader in biotech innovation, selecting it as an area of interest alongside cleantech, healthtech and digital tech.

How incubators help de-risk and accelerate growth

Europe is home to a variety of startup incubators that provide essential support to early-stage ventures, benefiting both startups and investors. By supporting startups during their formative stages – when technologies are still being refined and founders often lack business experience – incubators play a vital role in reducing risk. Biotope offers highly tailored guidance on securing early funding, establishing scalable business operations, developing IP strategies and navigating Europe’s complex regulatory landscape.

This targeted support to develop the startups’ technology and tighten the business model helps derisk biotech VC investment, making the sector a more attractive proposition for funding.

The role of mentorship and investor networks

Building a successful biotech startup requires a leadership team with diverse expertise to achieve distinct goals. While many biotech founders are excellent engineers and scientists with a profound understanding of their field and a clear vision for their innovations, they often lack the deep business experience necessary to scale and commercialise.

Mentorship programmes, such as those offered by biotope, bridge this gap by guiding startups through key areas like commercialisation, IP strategy and scale-up planning. These programmes also provide access to invaluable networks of industry contacts, offering founders opportunities to connect with experts, advisors and potential collaborators

At the same time, investor networks that specialise in biotech agrifood and biomaterials play a crucial role. These networks connect startups with investors who understand the unique demands of frontier science and are committed to backing innovations with real-world applications.

Key insights for agrifood biotech startups looking to thrive

For biotech startups in Europe, taking proactive steps early can streamline their path to commercialisation and mitigate common hurdles. Engaging with regulatory bodies as early as possible allows startups to embed compliance into the DNA of their products and processes, avoiding the costly and time-consuming need for retroactive changes.

Different partnerships can also play a critical role in a startup’s success. Paid corporate trial partnerships can prove the strength of startups’ ingredients within existing products and provide tangible results for customers and investors. Working together on a common research project with partners in a similar space can also be beneficial as collaborators pool resources and expertise.

Resilience and adaptability are essential traits for any biotech startup. By being prepared to pivot and respond to challenges with agility, startups can turn obstacles into opportunities and remain on track toward their goals.

An optimistic outlook for European biotech

Many people focus on the challenges currently facing biotech startups, and yet with the right support the industry can have a bright future. Biotech offers solutions to critical sustainability bottlenecks in industries from proteins and agriculture to packaging and chemicals. Many businesses and investors are keen to take advantage of the innovative solutions that the right biotech startup can offer.

At the same time, governments across Europe are also actively supporting the growth of these startups, offering grants and incubation options such as biotope. This kind of support is poised to drive the biotech sector forward in the coming years.

Biotech startups should take full advantage of the substantial resources and support systems available to them. These opportunities exist for a reason and can be the key to transforming a brilliant idea into a successful venture.