The SME Instrument: a HORIZON 2020 initiative
The SME Instrument is a HORIZON 2020 initiative regarding Small and Medium-sized Enterprises that emphasize in Innovation and are EU-based or established in a country associated to the program.
The SME Instrument falls under the ‘’Societal Challenges’’ pillar of HORIZON 2020 and funds innovative projects that will help SMEs grow and expand their activities into other countries, inside and outside the EU. Provided with about € 3 billion in funding over the period 2014-2020, the SME Instrument addresses the financing needs of internationally oriented SMEs, in implementing high-risk and high-potential innovation ideas. It will launch the enterprise into new markets, promote growth, and create high returns of investment.
The SME Instrument addresses all types of innovative Small and Medium-sized Enterprises (SMEs) in order to promote growth champions in all sectors.
An enterprise is classified as SME if it has less than 250 people in its staff and a turnover that doesn’t exceed €50 million and/or its total assets don’t exceed €43 million. The estimation of an enterprise’s size takes in consideration the shareholder relationship it has with other enterprises.
The SME Instrument aims to give a strong boost to innovation by supporting highly innovative SMEs with a clear commercial ambition and a potential for high growth and internationalization. For those Small and Medium-sized Enterprises which meet the application terms, the Program offers support with highly concessional terms:
•Business innovation grants for feasibility assessment purposes (€50.000)
•Business innovation grants for innovation development & demonstration purposes, ranging from €500.000 – €2.500.000 (70% of the total cost of the project)
•Access to a wide range of innovation support services in order to facilitate the commercial exploitation of the innovation.
Phases of the SME Instrument:
1. Feasibility Assessment (optional)
In the 1st Phase funding is available for exploring and assessing the technical feasibility and market potential of a breakthrough innovation that a company wants to exploit and commercialize. A short business plan (about 10 pages) is submitted explaining why the project is innovative, and its technological and economic feasibility. Participation in Phase 1 is optional but if successful, it allows direct participation in Phase 2.
Funding: lump sum of €50.000 per project (not per participating business) for an extended feasibility assessment
Duration: typically around 6 months
2. Innovation Project
The 2nd phase of the SME Instrument aims to cover R&I activities with a particular focus on demonstration activities (testing, prototype, scale-up studies, design, piloting innovative processes, products and services, validation, performance verification etc.) and market replication encouraging the involvement of end users or potential clients. Funding is available for innovation projects that are supported by an extended and sound business plan (potentially funded and submitted in Phase 1).
Funding: in the indicative range of €500,000 – € 2.5 million or more (covering up to 70% of eligible cost, or in exceptional, specific cases up to 100%).
Duration: typically around 1-2 years.
The Final Phase of the SME Instrument provides support measures in order to help SMEs commercialize their innovative products and services. These support measures include networking, training, coaching and mentoring, facilitating access to private capital or better interaction with key stakeholders and a range of other services provided by the Enterprise Europe Network (EEN). SMEs will not be funded directly under phase 3.
SMEs are recommended to apply for funding starting with Phase 1; however they are allowed to apply directly to Phase 2 or even Phase 3, depending on the stage of the project. Successful completion of one phase will allow a SME to move on directly to the next one.
SMEs can apply for funds under Phase 1 and Phase 2 whenever they need to do so. The calls under these phases will be open according to a ramp-up phase in 2014 and then on a continuous basis until 2020. As for Phase 3, the calls for projects should be open through fixed time-windows.
Cut-off Dates (2014)
Phase 1: 18/06/2014
Phase 2: 09/10/2014
VK PREMIUM Business Consultants LTD is here for you to:
• evaluate your innovative idea
• help you through phases 1 and 2 of the program
• conduct your feasibility study and business plan