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Hoping to give Europe’s surging startup ecosystem a shot of adrenaline, the European Union today announced the creation of a massive new fund-of-funds program dubbed VentureEU.

So far, the EU has committed $505 million of its own budget to the project, which now faces the challenge of raising the balance of the $2.6 billion fund from private investors.

VentureEU will include six funds to invest in VCs that are focused on such areas as digital services, medical technologies, life sciences, and energy. The program was officially unveiled today at the EU’s Digital Day in Brussels.

“In venture capital, size matters!” said Jyrki Katainen, the European Commission’s VP for Jobs, Growth, Investment, and Competitiveness, in a statement. “With VentureEU, Europe’s many innovative entrepreneurs will soon get the investment they need to innovate and grow into global success stories. This means more jobs and growth in Europe.”

The program is at once a massive undertaking and an indication of the huge challenges Europe faces as it seeks to turbocharge its startup economy.

The EU highlighted these problems in its own announcement. In 2016, U.S. startups raised 6 times as much venture capital as their European counterparts. Despite the proliferation of VC funds in Europe, most remain on average only one-third the size of a U.S. venture fund. And Europe only had 26 private companies valued at more than $1 billion at the end of 2017, compared to 109 in the U.S.

Indeed, Europe has become adept at helping entrepreneurs launch their startups, but many still migrate elsewhere as they seek later-stage funding. Or they simply get stymied in their attempts to scale across Europe.

And despite the EU’s good intentions, the unveiling was a reminder of the limitations it faces as it seeks to shift funding dynamics across the region. Plans for a pan-European fund like this one were actually announced in 2015. It took three years of consultations to reach this point. And now the bulk of the money will be distributed to VC funds, which must then raise the balance and identify startups worthy of the investment.

The European Investment Fund managed the process of identifying the six funds that would receive the money. Today, the EIF signed deals with the first two: Isomer Capital and Axon Partners Group. It expects to sign the other four this year: Aberdeen Standard Investments, LGT, Lombard Odier, and Schroder Adveq. These funds will then distribute the money to other VCs around Europe.

The announcement of the VentureEU project came as Andrus Ansip, the EU’s Digital Single Market minister, called for more investment in critical technologies such as artificial intelligence, blockchain, and health care.

“The European tech sector identifies AI and blockchain as the areas where Europe is best positioned to play a leading role,” he said, during a speech at Digital Day. “However, it is no secret that we have to invest — both politically and financially. There is quite some ground to catch up. Other continents are moving ahead quickly.”

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