Multidisciplinary is the first word that springs to mind when I think about innovation grant funding since 2020. There has been a distinct move on behalf of grant funders in recent years to embrace technology, expand the range of funding for innovation and align with how the VC’s are doing it. No doubt, changes have been backed up with even more grant funding for innovative businesses – so what does innovation grant funding look like in the 20’s?
By the end of this blog, you will have a better understanding of what it will require to access innovation grant funding in the 20’s. From video pitches and slide decks to face-2-face interviews and equality strategies – and of course there is all the ‘grant stuff’ that is essential to get right.
The European Research Council (ERC) who run the ever-competitive EIC Accelerator program, are the first grant funding body to deploy AI technology into the assessment of grant applications. At the gates of the €2.5m (grant) and €15m (equity) fund open to all innovative companies in Europe, is an AI-enabled grant assessor. Stage 1 now requires the preparation of a 3minute video, 10-page slide deck and a 5-page written application (in the form of a questionnaire). There is no grant funding for Stage 1 this time round – the days of the €50k SME Phase 1 grant are gone – instead a combination of AI and a human assessor will simply provide a “Go / No-Go” decision. Stage 2 is the familiar 45-page grant application, while the reward comes after Stage 3 (interview), when businesses secure game-changing grant funding and equity investment.
One of our Venturenomix clients, a scale-up business (£4m t/o and 72employees) engaged us to develop a grant application to a part-grant / part-private-equity funding call from Innovate UK. The UK’s leading innovation funding agency has doubled-down on partnerships with private equity firms following successful pilots testing co0investment of grant and equity. Businesses can expect to see more opportunities to unlock further equity funding (circa. £1m) by securing ‘grant match funding’ – effectively a win for 3 parties:
- Public Funding in the form of innovation grants are leveraged by private investment
- VCs and active angel funds bring forward investment based on lower risks
- Innovative businesses retain more equity and secure significant scale-up funding
Collaborative European Grant Funding through Horizon Europe, Digital Europe and other European Grant Funding Bodies, has been boosted to €95.5bn between 2021 and 2027. The programs are now live with the requirement to bring together consortiums of partners across Europe. Businesses, Universities, Cities, Public Bodies, Charities, Citizen Groups and NGOs are invited to form consortiums and apply for between €1m and €40m+ in grant funding per project. Access to an international network of potential partners and grant experts with a deep understanding of the requirements is going to be fundamental to securing Horizon Europe Grant Funding. At the same time, the European Enterprise Network (EEN) that provides partnering services for organisations all over Europe, is no longer operational to UK-based organisations. Watch this space for the replacement – word on the grapevine has named the new support program “Internationalisation” – more to follow. CORDIS remains and is excellent.
In summary then – innovation grant funding is evolving. And increasing in quantum. There is a realistic chance of securing this equity-free, debt-free source of R&D funding. The more niche grant funding calls offer you a higher chance of success (the average success rate of Innovate UK Smart Grants in 2019/20 was 6.1%) because there is less competition. To improve your chance of success you are going to have to do more research, develop more content and think dynamically about grant funding as a core element of your business funding strategy.
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