Mario Draghi had no trouble demonstrating it: compared to the United States, Europe is lagging behind in innovation, especially digital innovation, the economist stressed in his resounding report on the competitiveness of the EU. He only had to take a look at the world’s top five stock market capitalizations: Microsoft, Apple, Nvidia, Google and Amazon. All in tech, all American.
This absolute domination, although challenged by China, is not recent. It is often pointed out that private investments are half as high in Europe as in the United States. Furthermore, the European Union struggles to spend more than 2% of its GDP on research and development, even though it set itself the objective of 3% in Lisbon in 2000 – the United States is at around 3.5%. Some also point out the lack of an organization dedicated to the most avant-garde, “disruptive” technologies. On the Old Continent, an idea is therefore returning: copy the Defense Advanced Research Projects Agency American, better known by its acronym “Darpa”. “This agency has been in all the reports on Europe’s competitiveness for about twenty years,” sighs Valérie Mérindol, professor at the Paris School of Business, and author of several works on innovation in defense with her colleague David Versailles. Emmanuel Macron, twice, at the Sorbonne in 2017 and then in 2024, had expressed the wish. The former Italian Prime Minister, too, could not help but add it to his 170 proposals.
Why? Darpa, founded in 1958, is a true “myth”, says the specialist. It is at the origin of the Internet – via the Arpanet project -, of GPS, has enabled breakthroughs in artificial intelligence, messenger RNA, drones, autonomous vehicles. Its renowned challenges and funding have allowed companies such as Moderna, Boston Dynamics or SpaceX to take flight – titans, now, revolutionizing the fields of science, robotics and space. “At the base, these are mostly military projects, but ultimately, many of them have had civilian outlets”, notes Valérie Mérindol. His timelineon its website, listing its finest feats of arms, more or less traces the great technological advances of the past century. We can see that Darpa is involved everywhere, or almost.
We ask for forgiveness afterwards, not permission.
The political and economic world dreams of drawing inspiration from it. “What is interesting with the model established by Darpa is that the State becomes the main client of start-ups, with funding and pre-orders. This allows significant resources to be allocated to R&D”, Maya Noël, General Director of France Digitale, the first collective of start-ups and investors in Europe, recently rejoiced to L’Express. However, the plan is currently facing many challenges. “Many people are talking about it without really knowing what it will lead to”, explains Pierre Azoulay, professor at the Massachusetts Institute of Technology (MIT), and co-author from a report on the “Arpa model” for the National Bureau of Economic Research. Because it is indeed a method, duplicated in the United States with energy prisms (Arpa-E created in 2009), or health prisms (Arpa-H, imagined in 2022).
“Autonomy is the most important component,” the expert continues. Project managers (program manager in the original version) make up an agency – there are about a hundred of them for Darpa. Each one initially defends his proposals, his subjects, to his peers. “And when a research program is authorized, this manager will benefit from great freedom to assemble his teams, and evaluate the projects that will make it possible to achieve an ambitious technical goal.” All research is outsourced to companies or researchers. Darpa only hires 220 people in total. “Behind the project managers, the most important people are those who reserve their planes,” notes Pierre Azoulay with humor. The structure is stripped of any other form of hierarchy, bureaucracy, and managers are recruited for periods ranging from 3 to 5 years, in order to constantly renew ideas and adjust needs. These men and women are real stars in their respective fields, with professional experience in academic research, the world of venture capital and that of entrepreneurship. Rare hybrid profiles.
“But would Europe be capable of giving this type of autonomy to such small teams? It’s not really part of its work culture so far, rather in silos,” says Valérie Mérindol. DARPA, too, communicates little about its failures. “And there are probably a lot of them,” the specialist emphasizes. All we know is that a proposal for a bomb based on hafnium metal failed, a long time ago. Few accounts are asked for on the use of this public money. “Its director – currently Stefanie Tompkins – communicates directly with the Secretary of State, just below the President of the United States. There is no intermediary,” also recalls the MIT professor. Risk-taking and speed are inherent parts of the agency – legend has it that the million dollar funding for Arpanet was negotiated in 15 minutes. “We ask for forgiveness after, and not permission before,” summarizes Pierre Azoulay. Which explains why Europe is struggling to create a Darpa: its ideological matrix is extremely American.
The Gold Standard
But the real reason why the EU does not yet have a Darpa is perhaps simpler: despite the rhetoric, it has never really tried to have one. “A former director of the agency told me that she had met many European decision-makers who wanted to study its system. She regretted never having heard back from them,” confides André Loesekrug-Pietri, head of the Joint European Disruptive Initiative (Jedi), a European foundation, itself copying Darpa, but financed by private capital. An “unidentified political object”, he describes, which like its American model, has program managersand projects in new materials, drugs or even hyperspectral imaging, supported to the tune of several million euros. This remains little, however, compared to the 4 billion dollars of funding available to Darpa. The Jedi and its 6,000 contributors, from all four corners of the continent, remain the closest thing to it currently.
Mario Draghi recently raised the possibility of transforming the European Innovation Council (EIC) – launched in 2021 after a three-year pilot phase, and with a budget of 1.4 billion euros per year – into an Arpa-type agency. Its current operation is comparable for the moment to that of an investment fund. And only 30% of the money spent goes, according to the magazine Natureto disruptive technologies. “The EIC appears more focused on correcting perceived capital market imperfections than on promoting innovation, given that a substantial portion of its spending supports the capital structure of small and medium-sized enterprises (SMEs) and, to a more limited extent, start-ups,” criticizes a study on European innovation published in April, in which Nobel Prize winner in economics Jean Tirole notably participated.
Its transformation is commendable, but the project promises to be major. The study, also arguing for a European Darpa, deplores a project study process at the EIC that takes almost three times longer in Europe than in the United States, with a heavier bureaucracy and far fewer competent project managers. The famous cultural gap. But also a casting issue. “The members of the EIC board of directors are not required to be leading scientists, and many of them have a business background. Only 4 of its 21 members are professors and less than half of them have a degree in science or engineering.” Overall, the document concludes, the EU’s current programs aimed at encouraging innovation are therefore far from what the authors call “the gold standard” in this area.
“Sputnik Moment”
In Europe’s defense, adapting the Arpa model is not easy. Including in the United States. Not all attempts are crowned with success. Arpa-E, in energy, has experienced funding cuts, and was nearly torpedoed by Donald Trump. For the moment, its setbacks have been more talked about than its innovations. New verticals, in education or agriculture or climate, have not managed to see the light of day, due to lack of funding or political implementation.
It should be remembered that Darpa’s initial success is due to a generous client: the US Department of Defense, and its $850 billion budget, which alone represents nearly 30% of the GDP of a country like France. The timing of its creation is important: at the beginning of the Cold War, after the major alert that was the launch of the first Sputnik satellite by the Russian enemy. This is surely where the spirit of conquest, agility and liveliness that still characterize Darpa today come from. Finally, it is good to remember that Europe does not have a defense force, strictly speaking: neither an army nor a minister. A point that it intends to strengthen in the years to come. Russia’s invasion of Ukraine may have been its “Sputnik moment”.
At present, the Arpa-type agencies that are spreading across the continent are less defense-oriented. For example, Jedi, but also Sprin-D in Germany. The same observation can be made elsewhere in the world, with Moonshot R&D in Japan, and Aria in the United Kingdom, headed by a formerprogram manager of Arpa-E, Ilan Gur. A good sign of “open-mindedness” and progress of the Arpa model outside its country of origin, notes Pierre Azoulay. To the point of becoming a reality in the EU?
Valérie Mérindol, who worked for the Ministry of Defense, discusses other possible disruptive innovation vehicles for Europe. The expert cites the German Fraunhofer institutes in applied sciences and the French CEA-Leti institutes in microelectronics, at the forefront of their respective fields thanks to a mix of public and private funding. Imec in Belgium, where all the world’s semiconductor manufacturers are gathered – a decisive technology, particularly in the race for artificial intelligence – also falls into the category of successes. A way of reminding us that the Old Continent knows how to innovate, even without Darpa.
.