A comprehensive overview of the European Commission’s flagship programme for start-up and SME innovation funding

Should you apply?

• Do you have a high-impact innovative product, service or business model that could create new markets or revolutionise existing ones in Europe and throughout the world?
• Are you a start-up or small and medium-sized enterprise (SME) with the ambition and commitment to scale up?
• Does your project i) require substantial funding and ii) involve risks too high for private investment alone?

If you answered yes to all the above questions, the EIC Accelerator may be for you; keep reading to find out more.

What is the EIC Accelerator?

The EIC Accelerator is a core part of the European Innovation Council work programme. It is the European Commission’s flagship programme for supporting Europe’s most cutting-edge, business-led innovation. Specifically, the EIC Accelerator:

• Supports companies (principally start-ups and SMEs) to scale up high impact innovations with the potential to create new markets or disrupt existing ones. It provides a unique combination of funding from €0.5m to €17.5m, as well as Business Acceleration services.
• Focuses on innovations that build on scientific discovery or technological breakthroughs (“deep tech”). These innovations will need significant funding over a long timeframe before returns can be generated (“patient capital”). As a result, they often struggle to attract financing. The EIC Accelerator provides a viable solution; it enables innovators to attract the full investment amounts they need to scale up in a shorter timeframe.
• Is open to innovations in any field of technology or application. However, it will not support innovations designed primarily for military applications or those that harm the environment or social welfare.
• Supports the later stages of technology development as well as scale up. The technology component of your innovation must therefore have been tested and validated in a laboratory or other relevant environment. In other words, it must be at Technology Readiness Level (TRL) 5 or higher.
• The EIC Accelerator provides blended finance, comprising both ‘investment’ and ‘grant’ components.

What support will you receive if your proposal is funded?

An “investment” component in the form of equity or guarantee 

Ranging in size from €0.5m – €15m, the investment component is primarily for financing market deployment and scale up. However, it may occasionally be used for other purposes (including co-financing or fully-financing innovation activities). The specific terms of investment are considered on a case-by-case basis and negotiated during the EIC Fund’s due diligence process. In the case of equity, investments should not exceed 25% of the voting shares of the company and will be made with a long average perspective on return on the investment (7-10 years) with a maximum of 15 years (‘patient capital’).

A “grant” component to reimburse eligible costs incurred for innovation activities

Typically, the grant component should not exceed €2.5m and all innovation activities should end within 24 months. The EIC Fund will reimburse eligible costs up to a maximum of 70%. Eligible innovation activities for the grant component include demonstration in a relevant environment, prototyping and system-level demonstration, R&D and testing required to meet regulatory and standardisation requirements, intellectual property management, and marketing approval (e.g., TRL 6 to 8).

Costs incurred for the commercial introduction of the product or service and full scale up operations (e.g., TRL 9 or above) will not be reimbursed by the grant but can be financed by the equity investment. In addition, applicants do not have to request a grant component, while small mid-caps are not eligible to receive grants.

By derogation, you may request a “grant component only” (i.e., maximum €2.5m to cover TRL 5/6 to 8 and without requesting an investment component for TRL 9) under the following conditions:

1. You can provide evidence that you have sufficient financial means (e.g., revenue flow, existing investors, or shareholders) to finance the deployment and scaling up of your innovation. In such a case, you will have to demonstrate in your proposal that you possess the necessary resources and financial means to provide for the necessary TRL 9 expenditures.
2. Your innovation is based on a scientific discovery or novel technology and needs significant validation and demonstration in a relevant environment to accurately assess its commercial potential. Such innovations may be based on research results from the EIC Pathfinder and Transition or the European Research Council.
3. Your company has not previously received grant-only support under the EIC Accelerator.
4. As part of the UK-EU Trade & Cooperation Agreement, UK entities are only eligible to apply for the grant element of the EIC Accelerator.

How do you apply and how long does it take?

The application process consists of three steps:

1. Short application – you can submit a short application at any time.
2. Full application – if your short application is successful, you will receive an invite to prepare a full application. At this stage, you will have access to support through a dedicated platform and independent experts and coaches. A remote evaluation of applications will then take place.
3. Face-to-face interview – finally, successful applicants will receive an invite to attend a face-to-face interview.

What does the short application consist of?

You can submit a short application at any time via the European Funding & Tender Opportunities Portal. We are currently in a transitional phase from Horizon 2020 to Horizon Europe, but we expect the European Commission to begin accepting applications from the spring. The short application consists of:

• A 5-page form where you must respond to set questions on your innovation, your potential market, and your team.
• A pitch deck of up to 10 slides following a set format.
• A video pitch of up to 3 minutes where the core members of your team (up to three people) should explain the motivation for your application.

Within 4 weeks, you will receive the result of your short application and feedback from the independent evaluators. This will inform you whether your application met the necessary criteria to proceed to a full application.

If your short application is unsuccessful, you have the option to resubmit one further time; where this occurs, you should make significant improvements to your application in line with the feedback. If your application does not meet the criteria a second time, you will not be able to apply again for 24 months.

What does the full application consist of?

If successful at the short application stage, you will receive an invite to prepare a full application. You can submit a full application to any of the cut-off dates but it must be within 12 months of receiving a response to your short application. The cut-off dates for 2021 are 16th June and 6th October.

At this stage, independent experts will assess your application against the competition criteria. You will hear whether your application meets the criteria within 5-6 weeks. If successful, you will receive an invite to attend a face-to-face interview. If your application does not meet the criteria, you can submit a revised full application to one of the 2 following cut-offs. You may also receive a Seal of Excellence if your application meets the excellence and impact criteria.

What does the face-to-face interview consist of?

Face-to-face interviews take place approximately 8-9 weeks after the cut-off date and are conducted by a panel of jury members. While EIC Programme Managers and representatives from the EIC Fund may also participate as observers, they will not have any voting rights. The EIC will update you on the interview’s outcome within 2-3 weeks.

What happens next?

If you are successful at the interview stage, you will negotiate terms and then sign an initial agreement for the grant component. This will include a first pre-financing payment. At the same time, your company will be subject to a due diligence process by the EIC Fund to proceed with the negotiation of the investment component (i.e., terms and milestones). During this stage, the EIC Fund will also look for other investors. This process should take between 2 and 6 months. Before it ends, the EIC Fund will reach an investment agreement and relevant corresponding changes will be incorporated in the agreement on the grant component.

If you have any further questions or would like to discuss a potential application, please get in touch. Not the right match for your innovation? You can find alternative funding opportunities on our website and in our free monthly newsletter.