Why many data space initiatives face a financing gap
Across Europe, data spaces are rapidly becoming the backbone of a trusted digital economy. They promise secure data exchange, crosssector innovation, and alternatives to platformdominant models.
Yet, many promising initiatives stall after the pilot phase. The reason, often, is not technology - it’s financing: over 85% struggle to secure stable, long‑term funding beyond timestamped subsidies. The subsidy dependence of many initiatives, combined with decentralized governance, slows decisions, deters private investment, and fragments adoption.
A new TNO report, ‘Bridging the Financing Gap for Data Sharing Initiatives’, sheds light on what it takes to move from subsidydependence to longterm resilience. Drawing on three realworld Dutch cases the report shows that hybrid finance models (i.e., publicprivate models) are not just an option but may be a strategic necessity across many sectors.
Download here the full report
‘Financing alone doesn’t make a data space sustainable. It’s the combination of governance maturity, tangible value, and shared commitment that keeps an ecosystem alive,’ says Gijs van Houwelingen, one of the lead authors.
Why the financing gap persists
In practice the financing gap looks something like this:
- Expiring grants undermine operational effectiveness and prevent agreement schemes and trust frameworks from being properly maintained.
- Participants postpone investments due to uncertainty, which limits adoption.
- Administrative uncertainty due to unclear decision-making horizons.
What publicprivate partnerships enable
The report demonstrates that PublicPrivate Partnerships (PPPs) offer the a viable route to financial and organisational stability. They combine:
- Public legitimacy: essential for trust, neutrality, and alignment with longterm policy goals.
- Private agility: needed to innovate, codevelop services and drive adoption.
- Shared risk: reducing dependency on single sources of funding.
- Balanced governance: preventing dominance by either public or private stakeholders.
- A future proof value proposal: covering both societal and private interests.
Across all cases, PPP structures enabled ecosystems to mature their trust frameworks, attract diverse participants, and organise development efforts more efficiently.
Three cases
Three concrete cases demonstrate how financing enables institutional capacity and neutrality:
1.
EduV: longterm public investment as a catalyst
Edu-V, now a trusted dataspace for sharing digital learning resources, demonstrates how almost a decade of public financing can scale up a neutral trust framework in a fragmented educational sector. A large, nineyear growth fund investment enabled the initiative to professionalise, develop a an attractive quality mark for suppliers, and form a foundation with balanced publicprivate governance.
Key insight: public longevity reduces risk and attracts private commitment, but structural funding eventually needs diversification.
2.
LIFES: building a membershipdriven model
LIFES, a data space transforming global data reuse, takes a different path. With roots in the global FAIR movement, it operates as a nonprofit association funded by a mix of membership fees, inkind contributions, and service revenue. Both private and public parties provide monetary and in-kind contributions, only allowing joining to those who are truly committed.
Key insight: participantfunded models can thrive if governance is neutral, benefits are tangible, and ‘fairwashing’ is prevented through strict vetting.
3.
Zorgeloos Vastgoed: intermediaries as accelerators
In real estate, a sector with thousands of SMEs, Zorgeloos Vastgoed shows the power of intermediary funding. Large associations (HDN, NVM, KNB, Kadaster) cofinance the initiative and act on behalf of their members. By leveraging marketdominant software provider, adoption accelerated across the entire chain, allowing for more efficient, accurate, authenticated data sharing in the real estate sector.
Key insight: intermediaryled PPPs are effective when sectors are fragmented and many small players must be onboarded efficiently.
‘The success stories show that hybrid models can turn concepts on paper into thriving data ecosystems that deliver tangible change, all of which could not be done without reducing risk, a clear value proposition for each stakeholder and collaboration between parties,’ reflects Kristiina Sau, the lead author of the position paper.
A stepping-stones approach to sustainable financing
Most initiatives won’t jump from grants to cost‑recovery in one go. They progress through what we call stepping‑stones:
- Seed grants to establish trust frameworks and core standards.
- Longterm public investment to signal permanence and reduce risk.
- PPP governance structures to balance interests and ensure neutrality.
- Intermediary funding to reach the long tail of small actors.
- Service monetisation linked to onboarding, certification, and compliance.
- Participant funded models offering structural income and stakeholder commitment.
There is no optimal route across these stepping-stones, they can be used to trace a route through fast‑moving waters that best suits the data space in question. Above all, data spaces evolve through transitions, not leaps. Sustainable financing is not a fixed model, but a journey shaped by readiness, trust, and collaboration.
Co-creation
The research was conducted in collaboration with the Centre of Excellence for Data Sharing and Cloud (COE-DSC), EduV, Zorgeloos Vastgoed and the Leiden Institute FAIR & Equitable Science (LIFES).
Meet the authors
Questions? Get in touch with me
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Miriam Veronesi
Functie:Business ManagerSpecialisatie niet bekendI’m Miriam Veronesi, Business Manager at TNO Vector. The approach I adopt is scalable, ensuring that the partnership can grow and adapt over time to deliver tangible outcomes.
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E-mail:E-mail Miriam
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LinkedIn:Miriam on LinkedIn
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