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2 years - 500 million € invested

01-02-2017
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Over 20.000 applications received, € 500 million invested in more than 1400 projects and more than € 692 million of private equity attracted. Since 2014, the European Union's new € 80 billion Framework Program for Research and Innovation - Horizon 2020 – contains a dedicated tool for financing innovation in small and medium-sized enterprises (SMEs). ​

"Catalysing European Innovation" – a Report on the two first years of the SME Instrument, published today, shows that the programme has kicked off well and gives effective and valuable support to small innovative companies. The report analyses the profile of funded SMEs, presents their innovations and outlines first emerging trends.

Who are the funded companies?

The SME instrument attracts a very diverse public: early stage start-ups but also scale-ups with confirmed positions on the market and ready to internationalise their business. The beneficiaries include family businesses, service companies, research-oriented SMEs etc.

Most companies funded come from Spain and Italy followed by the UK, but Ireland is proportionally the most efficient in getting its proposals funded. The ICT sector counts the biggest number of applicants and selected companies.

Almost a third of the selected companies are start-ups, meaning that they are younger than 3 years. The average age of SME instrument funded companies is 11 years. For some topics, the average age is much higher. For the Nanotechnologies topic, for instance, 42% of Phase 1 funded SMEs and 56% of Phase 2 funded SMEs are more than 11 years on the market. On the contrary ICT companies funded under the SME Instrument are young: 46% of Phase 1 funded SMEs and 35% of Phase 2 funded SMEs in the ICT topic are less than 3 years old. 11% of the companies are backed by accelerators and 12% are spin-offs by academia.

The average company funded by the SME Instrument has 21 employees. 11% of Phase 1 and 15% of Phase 2 funded companies have between 50 and 249 employees.

SME applicant companies come mostly from manufacturing - 24% of funded SMEs - while professional and S&T activities account for only 17% and information and communication activities for only 16%.

63% of SME instrument funded companies are in the pre-industrialised stage. 28% are in the seed stage and 35 % in the project-to-project stage. 22% are in the upscaling stage (22%).

Competition is tough as the success rate is 8% for Phase 1 and 6% for Phase 2. But once they get there, businesses can receive from € 50.000 up to € 2.5 million to finance 70% of their project. In addition, every euro invested is smart money – funded companies get 3 days of business innovation coaching under Phase 1 and 12 days under Phase 2.

First Results – More investment Attracted

A first sketch shows that selected companies have attracted 3 times more private investment than before participating to the programme. They have gathered a total of € 692 million in private equity and report benefitting from faster access to markets.

Read the full report and have a look at our infographic with 15 facts about the SME Instrument.

Source: EASME

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