The European commission has made its top priority jobs and growth. And for good reason. Growth remains sluggish across most parts of Europe, with a growth forecast of 1.7% for the EU and 1.3% for the eurozone for 2015. Unemployment is expected to remain at stubbornly high levels of around 10%, and investment remains subdued.To break out of the cycle of economic underperformance, the commission has undertaken two major initiatives: Jean-Claude Juncker’s Investment Plan for Europe and the Capital Markets Union (CMU). While the former is expected to have an impact in the short term, the CMU is a more ambitious and longer-term project. To work, the CMU needs to place the emphasis on improving the connections between savers, investors and companies. EU policymakers should focus on firms that have ambitions to innovate and expand since it is this particular group that drives up the rate of job creation and growth. The CMU’s goal should therefore be to do whatever it takes to support firms in their growth ambitions.This project analysed the challenges faced by high-growth and innovative firms in France, Germany, Italy, Poland, Sweden and the UK. Together these economies account for nearly 70% of the EU’s GDP. The research was based on detailed data analysis of access to finance challenges faced by high-growth and innovative firms, as well as interviews with a wide range of public- and private-sector stakeholders.Despite the diverse cultures, institutions and conditions of the six reviewed member states, a number of common concerns emerged for growth firms, investors and banks:• Europe is severely lacking equity financing. Poorly developed tax and insolvency regimes for investors remain critical drivers behind this shortfall. Although national governments are aware of these issues, some raised legitimate concerns on the difficulties of funding this type of structural reform. Furthermore, public policy to try and increase funding levels for venture capital do not appear to be working.• There is too little focus on the things that work well and a lack of mutual learning between member states to take advantage of this. Examples of best practice ranged from business support schemes, to the development of local ecosystems, the value of credit mediation schemes for firms rejected for finance and more business-oriented education systems. Concerns also remain that some existing rules of the single market are not being enforced effectively and that financial services regulation has been excessive and sometimes contradictory since the financial crisis.• Concerns were raised that banks may have less access to the capital market to diversify their sources of funding and help transfer risk due to punitive charges for high-quality securitisations.• There was little appetite that Europe should abandon its traditional banking model, but there was strong support for a complementary system of financing focussed on specific areas of the capital market.