Funding opportunities do not end in the United States for American businesses. US companies willing to expand their technological research to the global stage may be eligible for funding from the European Innovation Council (EIC).

Similar to the SBIR, the EIC Accelerator supports Small and Medium Enterprises (SMEs), in particular Startups and spinout companies to develop and scaleup game-changing innovations.

€10 billion in grants-funding available for SMEs and small midcaps via the European Innovation Council (EIC), the European Commission’s flagship innovation funding programme for the period 2021-2027.

The EIC is a key novelty of the Horizon Europe programme established by the European Commission (EC) that aims to identify, develop and scale-up breakthrough technologies and disruptive innovations.

Funding is provided through three main instruments addressing all stages of the innovation lifecycle: Pathfinder, Transition and Accelerator. Each instrument comprises open calls for proposals in any field of science, technology or application and challenge-driven calls targeting specific strategic priorities.

In the current funding cycle, the EIC Accelerator, which provides funding and investments to develop and scale up breakthrough innovations, features the eligibility of small midcaps (i.e. companies that do not comply with the definition of an SME but have fewer than 500 employees) in limited cases.

All EIC funded projects and companies - as well as selected applicants - have access to EIC Business Acceleration Services. Moreover, the EIC also provides additional activities such as prizes.

EIC Accelerator

The EIC Accelerator supports SMEs, in particular startups and spinout companies, to develop and scaleup game-changing innovations.

As a novelty of this funding cycle, also small midcaps (up to 500 employees) are supported, but can only apply for rapid scale up purposes and only for the investment component (i.e. they are not eligible to receive a grant component).

The blended funding dimension of the EIC Accelerator is another novelty of the programme, after being piloted during 2018-2020 as part of EIC/ Horizon 2020. The blended finance is composed of a private investment component via the EIC Fund and a grant component. Applicants can choose to request the private investment only, as in the case of small midcaps, and are not required to request a grant. The terms for the private investment component are quite complex (involving a mix between the EIC Fund and a private investor, typically VC) but very attractive for the funding recipient (scale-up capital), as well as for the private investor.

The EIC Accelerator can provide grant funding (non-dilutive) of up to €2.5 million for innovation development costs, and investments (direct equity) from €500 thousand up to €15 million via the dedicated EIC Fund.

Grants will be offered with a funding intensity of typically 70% of eligible costs incurred for innovation activities. These include: demonstration of the technology in the relevant environment, prototyping and system level demonstration, R&D and testing required to meet regulatory and standardisation requirements, intellectual property management, and marketing approval.

The EIC Accelerator has a total budget allocation of €7.2 billion, split between the “Open Call” (€3.7 billion) and “Challenges” (€3.5 billion). The expected yearly total budget allocation is approximately €1 billion per year.

Open call

The EIC Accelerator is open to innovations in any field of technology or application with the exception of innovations that harm the environment or social welfare or that are designed primarily for military applications.

Challenges

Innovations in strategic digital and health technologies.
Green Deal innovations for the economic recovery.

Application process & calendar

New applicants can submit a short application at any time (no cut-offs) using the EIC AI platform online.

After an assessment by independent experts, successful applicants will be invited to prepare a full application and pitch in front of a jury of investors and business experts at set cut-off dates.

The cut-off dates for full applications in 2022 are 23 March, 15 June and 5 October.

Note that it is possible for entities from non-associated third countries - such as the United States - to submit the short application for the EIC Accelerator, but they will need to either establish or relocate an SME (including start-ups) or small mid-cap to an EU Member State or an Associated Country by the time of submitting a full application.

Alternatively, it is possible to submit a proposal on behalf of a SME or small mid-cap established in an EU Member State by entities intending to invest in these companies, provided that a prior agreement exist with the company.

EIC Fund

The EIC combines the accelerator instrument with a dedicated equity fund, the European Innovation Council Fund, to scale up innovative start-ups, SMEs and small midcaps. Around €3 billion of the EIC’s budget will go towards the EIC Fund, with an expected yearly allocation of approximately €300 million.

The equity investments, ranging from €500 thousand to €15 million per beneficiary, complement the grant financing provided through the EIC Accelerator. This is the first time the EC is making direct equity or quasi-equity investments, namely equity investment blended with a grant, in start-up companies, with ownership stakes expected to range from 10% to 25%.

Eligibility

To be eligible for funding, SMEs must be established in:

EU Member States (including overseas countries and territories (OCTs));
Associated Countries (as defined in Annex 3 of the EIC Work Programme);
low and middle income countries.

To be eligible for funding, small midcap companies must be classified as ‘Small mid-cap’ (up to 500 employees) and be established in a Member State or an Associated Country (vide supra).

Alternatively, one or more natural persons or legal entities, also from non-associated third countries, can apply provided they are either:

intending to establish an SME or small mid-cap in a Member State or Associated Country; or
intending to relocate an existing SME or small mid-cap to a Member State or Associated Country; or
intending to invest in an SME or small mid-cap in a Member State or an Associated Country, hence submitting a proposal on behalf of that SME or small mid-cap.

Note that in cases (i) and (ii) above, the company should be respectively established or relocated to a Member State or Associated Country by the time of submitting a full application.

In any case, the application of small midcap companies can only be within the EIC Accelerator for rapid scale up purposes and only for the investment component. Moreover, small midcaps will be expected to provide documentary evidence that their bank has refused the financing needed for the project.

How can Winnovart help you

– If you would like to discuss a new project idea with us, don’t hesitate to fill in our funding readiness questionnaire. and we will come back with our independent feedback.

– Winnovart’s independent service options are designed to help you accelerate your access to this funding and navigate with confidence through the entire process of applying for, obtaining the grant and implementing your project successfully.

For more information on the EIC programme, please read here.

Additionally, for ongoing updates about the EIC, please get in touch with us.

At Winnovart, it is part of our mission to bridge the gap between stakeholders of the grants-funding market-space across Europe. We believe in the potential of grants to create ecosystems that drive innovation, growth and reduce disparities between the regions of Europe. Our aim is to support innovative SMEs, private investors and funding agencies to become part of this ecosystem and make the most of it.

Our presence in Western, Eastern and Northern Europe enables us to create international business cases for our clients, in the context of attractive funding programmes as well as beyond it, by opening up international development opportunities.

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