With the 2021’s EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity) program being adopted shortly, many startups and Small- and Medium-Sized Enterprises (SME) are eagerly waiting for the call to open (read: EIC Accelerator Introduction).
Most consultancies and professional writers have likely already gathered significant information on the new template and process but the latest video leak from the EU Science & Innovation YouTube Channel (here, here and here – they were ‘public’, then ‘private’ and are now ‘unlisted’) gives great insight into the details (read: The 2021 Work Programme). The Questions and Answers session served as a training for National Contact Points (NCP) and presented hour-long meetings with a variety of key stakeholders including developers of the AI Tool and Stéphane Ouaki, the chair of the investment committee of the EIC Fund (read: An Inside Look into Equity Financing).
The following presents a shortlist of the insights given in the meetings as they relate to the EIC Accelerator. EIC Pathfinder and Transition sessions are also available but are not covered by this article.
Attention: Since this information was presented informally, some of these points might be inaccurate or are subject to change over the coming weeks. The information was given in mid-March 2021.
- The Step 1 pitch video will be fully uploaded to the platform and not be submitted as a link.
- No template for the pitch deck will be given but a guide for the video.
- The pitch deck from Step 1 will not be used for the Step 3 interview.
- The challenge/topic will be chosen in Step 2 and not in Step 1.
- The AI Tool for Step 2 will be ready in mid-April 2021.
- In the long-term, the EIC envisions consultants to become part of their platform (for a fee, of course). The platform also contains Venture Capitalist’s (VC) and loan agencies.
- Involvement of NCP’s will be stronger with them receiving the application once submitted but this can be optional.
- The Step 1 threshold will likely be at the same level as the previous score of 13 (30-40% success rates) under Horizon 2020 (read: Interpreting the ESR).
- The remote (expert) evaluators have not been briefed yet since the Work Programme is not legally adopted.
- New investment guidelines for the EIC Fund will be published at the end of March 2021.
- The due diligence for equity investments aims at a 3-4 month duration.
- The due diligence looks closely at the capital structure of companies and, if an exit seems complex or impossible, it will not invest.
- The equity investments from the EIC fund were presented and showed a majority of funds moving towards MedTech (28%) as well as France as the main beneficiary for equity financing (31 beneficiaries – Israel as the second most-funded has 17).
- General steps for the EIC Fund’s due diligence process were presented in 9 steps (letter, contact, compliance, recommendation, discussion, decision, term sheet, agreement, signature).
These tips are not only useful for European startups, professional writers, consultants and Small and Medium-Sized Enterprises (SME) but are generally recommended when writing a business plan or investor documents.
Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) will be on June 16th 2021 and October 6th 2021 under Horizon Europe. The Step 1 applications must be submitted weeks in advance of Step 2. The next EIC Accelerator cut-off for Step 2 (full proposal) can be found here. After Brexit, UK companies can still apply to the EIC Accelerator under Horizon Europe albeit with non-dilutive grant applications only - thereby excluding equity-financing.
Contact: You can reach out to us via this contact form to work with a professional consultant.
EU, UK & US Startups: Alternative financing options for EU, UK and US innovation startups are the EIC Pathfinder (combining Future and Emerging Technologies - FET Open & FET Proactive) with €4M per project, Thematic Priorities, European Innovation Partnerships (EIP), Innovate UK with £3M (for UK-companies only) as well as the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) grants with $1M (for US-companies only).
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by Stephan Segler, PhD
Professional Grant Consultant at Segler Consulting
General information on the EIC Accelerator template, professional grant writing and how to prepare a successful application can be found in the following articles:
- EIC Accelerator Interviews: Pitch Deck vs. Proposal Documents (SME Instrument)
- Choosing a Good Project for the EIC Accelerator (SME Instrument Phase 2)
- The EIC Accelerator Budget: Grant vs. Blended Finance (SME Instrument Phase 2)
- EIC Accelerator – Introduction and Blended Finance (SME Instrument Phase 2)
- EIC-Accelerator Writing: Providing the Missing Link (SME Instrument Phase 2)
- The Biggest Mistakes When Applying to the EIC Accelerator (SME Instrument Phase 2)
- Identifying a Broad Vision for an EIC Accelerator Project (SME Instrument Phase 2)