Freelancers: The Other Side of the Consulting Industry (EIC Accelerator, SME Instrument)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) is a competitive funding program supported by a variety of consultancies and professional writers in the EU. Due to the high EU budgets and demand from Small- and Medium-Sized Enterprises (SME) and startups, there are diverse business models that have emerged in the industry (read: The EIC Accelerator Industry).

Inside this sector, one of the often-overlooked factors is the use of freelance writers by large consultancies. These are contracted for the writing of proposals, the editing of re-submissions in case a proposal was rejected and also for the pitch preparation (read: Structuring a Pitch Deck). It is common for a consultancy that is focusing on grant writing to have a network of such on-demand freelancers at their disposal and this talent pool often greatly exceeds the numbers of in-house writers.

The Need for Freelancers

Most prospect EIC Accelerator or Small Business Innovation Research (SBIR) applicants are not aware of how writing is commonly outsourced and generally expect to be working with a single consultancy once a contract is signed but this is not always the case. The decision as to which writer (i.e. internal or external) will take on an application largely depends on the capacities of the respective consultancy but also on budgetary factors.

From an economic perspective, most full-time employees of a consultancy are better utilized in the management and editing of proposals rather than in the writing itself. This is due to the fee’s that are normally paid to freelancers which can be much lower compared to those of a full-time employee. This system is a very useful way for consultancies to increase their own capacities but also for having a diverse pool of expertise at their disposal.

Why Freelancers are Working On-Demand

Such a set-up is typically a win-win scenario for both the freelancers and the consultancies since the former have a need to find work while the latter requires additional capacities from highly qualified experts. SME’s that wish to apply to the EIC Accelerator with the help of a consultancy likewise benefit from a broad pool of expertise while no excellent project has to be rejected due to a lack of capacities.

There are distinct reasons as to why this industry can operate in such a way and they are largely originating from the freelancers themselves who happily work in a remote capacity as on-demand talent. The following presents a shortlist of why this is the status quo and what could trigger a future change in this sector.

1. Freedom

One of the biggest reasons as to why freelancers choose to work as independent contractors is their general desire for more freedom in their working relationships. This can be due to a variety of factors such as a preference for working alone, the ambition to build up diverse revenue streams or also the inability to comply with office-work requirements such as relocating to a certain region, language-barriers or related obstacles.

Another often overlooked factor of freelancing is also the ability to decline projects and to select clients carefully. This is especially important in a highly competitive sector such as innovation grant writing since many startups who are determined to apply for the grant lack the prerequisites to be successful. The general eligibility requirements by the European Commission (EC) and European innovation Council (EIC) can give companies false hope in judging their own success chances if only the EIC Accelerator template is used as a basis.

While a full-time employee has to do the work they are told and lacks the freedom to make independent decisions, a freelancer can always decline projects and allocate their time according to their own needs.

2. Work Focus

A consultancy has to do a variety of tasks outside of providing their actual service and these additional areas come in the form of marketing, legal obligations, project management and administration. Freelancers often lack the time and resources to fulfil all of these additional requirements since providing a service such as professional grant writing is already a full-time occupation. Adding client contacts, project assessments and contractual processes to the list of tasks is often overloading an individual writer.

3. Visibility

Most freelancers have no visibility in the industry, lack the opportunity to meet clients, are inexperienced in finalising contracts, do not operate based on customer-first principles and are unfamiliar with the client assessment process (read: Assessing a Project). As a result, they are usually pigeonholed as writers who lack the skillset to expand beyond this occupation.

It is also often the case that writers rely strongly on editorial support from senior consultants when preparing a project since not every writer has the expertise to develop strategies for complex projects or has a learning-oriented approach to their work which would allow them to growth over time.

4. Dynamic Industry

Innovation grants and especially the EIC Accelerator are constantly evolving with changing proposal templates, evaluation processes via the European Agency for SME’s (EASME), submission requirements and even the eligibility thresholds for startups themselves (read: Proposed 2021 Process). In a dynamic industry like this, placing time and effort into administrative and operational tasks such as information gathering and communication with other experts is a must but often exceeds the capabilities of freelancers.

With uncertain future conditions, fluctuating demands and no guarantees with respect to the continuation of a grant program, most writers are preferring to collaborate with a consultancy and have a simplified work-load as well as a higher level of security even if this is to the detriment of their professional growth.

How The Industry Could Change

The current state of the EIC Accelerator grant writing industry is well-balanced and in no need for a change but there are some ways that could improve the standing of writers and also enable more transparency for startups and SME’s. The first step in such a scenario would be to bring the self-employed writers themselves out from the background and enable them to gain more visibility which can lead to them developing direct client relationships without the reliance on large consultancies.

This approach would allow writers who are exceptional at their craft to focus on writing while they can build closer customer relationships and be more dedicated to each individual project rather than writing many grant applications per deadline (read: EIC Accelerator Cut-Offs).

For this purpose, every freelancer should develop the skills of going beyond what is required since each project and client can present unique circumstances that have to be addressed. Instead of only performing the minimum amount of effort, a writer should be dedicated to the common goal they share with their client which includes working on improving the proposal’s evaluation rather than only meeting contractual terms.

Are you a freelancer? Feel free to sign up here: Freelancer Database.

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

Investigating EIC Accelerator Success Rates for Each Stage (SME Instrument)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) is undergoing a transformation in 2021 (read: Proposed Evaluation). The former 2-step process (application and pitch interview) which has been active for almost 4 years is gaining a third step (video pitch and mini-application) which can have a variety of effects on its funding thresholds (read: EIC Accelerator Introduction).

The Horizon 2020 Process

In the past, it was clear that Step 1 (long application) was the most difficult stage to pass through with success rates being well below 10% and with many weeks having to be invested in the preparation of the respective documents. On the other hand, Step 2 (pitch interview) was comparatively easy with success rates of approximately 50% and much shorter preparation times.

For startups and Small- and Medium-Sized Enterprises (SME), it was clear that the likelihood of receiving the grant financing improved the further one was in the process since the success rates were increasing for each step. To facilitate the application, many applicants relied on professional writers and consultancies to support them in working with the official proposal template.

In the old evaluation process, the funnel for the selection of EIC Accelerator applicants can be visualised as follows:

Note: 100 Applicants (Y-axis) are chosen as a base and 5 EIC Accelerator winners are selected for the sake of simplicity. The length of Step 1 (X-axis) is twice the length of Step 2 to reflect the amount of effort needed to prepare the documents.

In contrast, the newly introduced third step could change that dynamic since the three steps under Horizon Europe (2021-2027) could have entirely different thresholds. Depending on how these are distributed, it can render the EIC Accelerator an excessive time investment or can make the grant more appealing to startups.

Evaluation Thresholds under Horizon Europe

Based on the European Agency for SME’s (EASME) and the European Innovation Council’s (EIC) decision as to how proposals are scored and ranked as well as how their thresholds are determined, the success chances per step can vary greatly. Unfortunately, there is currently no definite way of predicting if the new Step 1 (the mini-application) will have a high or low success chance compared to Step 2 (the long application).

In the same vein, the interview and pitch evaluations could shift from the past model since performing them remotely presents an opportunity to execute more pitch evaluations at scale to screen companies. This could likewise lower the interview success rates significantly and change the dynamics of the application process (read: Pitch Interview Preparation).

From a participants perspective, the EIC should prioritize matching the effort an SME has to invest in an application with their success chances. This means that having a low-effort application with a high success rate followed by a high-effort application with low success rates would be frustrating for applicants since they will have wasted a lot of time and resources.

The central question is how much effort a rejected applicant had to place into an application and if this effort was proportional to their success chances. If the first two steps have success rates of 90% while the last step has a 5% success chance then the amount of time wasted is enormous. If the first step has a 5% success rate while the remaining steps select 90% of applicants each then this would be time well invested.

Visualising Scenarios

To visualise the difference scenarios, a pyramid-type funnel is used for the selection thresholds of each step. To simplify the representation of such scenarios, the following considerations apply:

  • A 3 Step evaluation is used to select 5 successful beneficiaries from 100 starting applicants. This yields a 5% success rate for the grant.
  • The selection thresholds are chosen as 50% or 20% to account for low- and medium-success stages. 50% * 50% * 20% = 5%
  • Since the effort per evaluation step will vary greatly, the long application in Step 2 is at least twice as difficult as either Step 1 or Step 3. For all 3 Steps, the following effort-relationship is represented on the X-axis: [1-2-1]

The result is the following overview whereas the Y-axis is proportional to the number of applicants and the X-axis corresponds to the effort that is placed into an application. The area of the pyramid represents the number of applicants (Y-axis) weighted by the effort (X-axis) they apply. The more “bulky” a pyramid is, the more time the rejected applicants will waste due to the chosen thresholds.

Analysing the Scenarios

In these three scenarios, it is evident that scenario 3 would be the best for applicants since the first and most selective step will require a low amount of effort. In the same vein, the second scenario is the worst outcome for applicants since they would invest a significant amount of effort into their applications while the chances drop towards the last step.

From the evaluator’s perspective, there is always a trade-off for the simplification of the application documents since an application that is too simple might be unsuitable for a grant selection while an application that is overly complex will waste both the applicant’s and the evaluator’s time.

Nonetheless, the EIC should aim to prioritize scenario 3 since this will greatly reduce the entry barrier for startups whereas they will know, with little effort, if the EIC Accelerator is suitable for them or not.

Unfortunately, the 2021 process will likely follow scenario 1 since it will be a simple extension of the 2020 process with only the addition of another step. This scenario would match the previous process since the 50% rates for Step 1 and 20% for Step 2 yield the combined 10% for the old Step 1.

In addition, the EIC and European Commission (EC) have decided to reintroduce thematic topics which are separate funding arms within the EIC Accelerator and will have different budgets, evaluator pools and levels of competitiveness. This will further increase the overall complexity of the evaluation process and can impact the effort-to-success ratio of each Step’s selection.

Future Predictions

The assumptions for the graphics presented above are limited and are only acting as a way of conceptualising challenges that applicants might face under the future EIC Accelerator.

Another interesting direction the EIC could move towards is the removal of the full application (Step 2) whereas all applicants could directly join a remote evaluation after passing the mini-application in Step 1. This is especially feasible for equity-applicants since the due diligence that follows the successful selection can replace the in-depth financial documentation of Step 2.

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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 Success Rates and Feasibility Studies (SME Instrument)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) is a competitive program targeted at innovative Small- and Medium-Sized Enterprises (SME) and startups. Under the name SME Instrument, it was active for many years and provided a financial support system over two phases – Phase 1 and Phase 2. The former consisted of a small grant of €50,000 while the latter is identical to the EIC Accelerator today (read: EIC Accelerator Introduction).

With the last Phase 1 deadline having been in September 2019, startups today do not have the option to first apply for this seed-grant which was a great opportunity to nourish early-stage startups and allow them to fully assess a project through a feasibility study. Such a study was not only useful to analyse the validity of an innovation or business model but also acted as a springboard to prepare the information-dense Phase 2 (EIC Accelerator) proposal since it requires extensive market studies, customer descriptions and a full business plan that includes the workpackages for the grant support (read: EIC Accelerator Workpackages).

This was a very useful setup and its effects were evident in the statistics collected on the Phase 1 & Phase 2 applicant success cases throughout 2018 (read: Impact Report). In the statistical report, it was found that the chances of receiving the SME instrument Phase 2 funding were 4.1% if no Phase 1 was secured beforehand while the chances rose to 6.8% with a completed Phase 1 project. This means that just having received and completed a Phase 1 project significantly increased the success chances of grant applicants (i.e. a 65% increase).

This increase, of course, can be due to a variety of reasons and the following article presents a shortlist of effects a Phase 1 project could have on a successful Phase 2 evaluation as well as strategies to emulate this advantage for the EIC Accelerator.

Description of the Pilot Results

The most obvious reason as to why the Phase 2 application is improved after a completed Phase 1 is that such projects likely have a comprehensive description of their respective pilot studies. Since the Phase 1 report includes content on the project’s feasibility, the corresponding sections of the proposal template can be filled with suitable content. This includes the documentation on the technical feasibility, test results and the descriptions of use-cases in the relevant environment.

When writing a Phase 2 application like the EIC Accelerator, it can often happen that pilot tests are neglected or not described with great detail. To remedy this, the obsolete Phase 1 feasibility studies have incentivised applicants to elaborate on them in-depth which is likely a contributing factor for the increased success rates.

Financial and Commercial Feasibility

The Phase 1 study directly requests validations of the feasibility from a commercial and financial point of view which can easily be overlooked when writing a business plan. Key factors in this validation process are the customer demand, willingness-to-pay, expected margins and a general analysis of the opportunity which can dramatically enhance the quality of an application.

Having a separate section describing such a detailed feasibility assessment is beneficial and can be neglected if the EIC Accelerator template does not directly ask for it. Even if no Phase 1 project has been funded prior, professional writers and consultants can still benefit from adding the respective section to an application.

Budget Allocation

Workpackages are a critical part of every EIC Accelerator application but they can be tricky since companies do not usually define their development work in such a distinct manner (read: Work packages). As a result, it is easy to rush the workpackage creation and its budgeting as a mere afterthought but this can make the respective implementation less believable or too vague. The Phase 1 feasibility study did remedy this since it requested information on the project’s future, required developments and budgets which could be directly used to inform the EIC Accelerator application.

Proposal Quality

In General, the narrative of the proposal is critical and the vision should be in full alignment with the expected impact, the innovation and the project itself (read: Assessing a Project). If a company has spent 5-6 months in preparing a report for Phase 1, they have likely further refined and aligned key cornerstones of an application (read: A Proposal Narrative). This can enhance every single proposal section since the Freedom to Operate (FTO), the timing, the introduction, the hiring needs, the Key Performance Indicators (KPI), the broader impact, etc. are all highly relevant but are often only briefly addressed.

The quality of a proposal is enhanced in relation to the amount of attention that is placed on its details. This is perfectly supported by a Phase 1 feasibility study which aids in just that – giving the applicant time and a structure to fill in the blanks.

Evaluators’ Bias

Lastly, there is always a bias from the evaluator’s position since seeing that a project has successfully completed Phase 1 will make Phase 2 more appealing to them. From their perspective, the applicant has already succeeded in a highly competitive application process, has completed the stringent documentation responsibilities and has delivered a final report. This element of ‘social proof’ has an effect on the reader and, in and of itself, is expected to increase the evaluation score (read: Buzzwords for the EIC Accelerator).

How to Use this Information

First of all, the absence of a Phase 1 option under the EIC Accelerator program should not be a reason to neglect the points listed above (read: Biggest EIC Accelerator Mistakes). A feasibility study or pilot project can be conducted independently, can come from other funding sources or be performed directly with customers. Taking the time to describe the past milestones, the results of extensive R&D and presenting technical as well as commercial and financial information to validate the project should be prioritized when planning an application.

Some documentation on the now obsolete Phase 1 process can be found in the official template for the feasibility study (here) and the Grant Agreement Contract (GAC).

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

The Reliance of EU Startups on Consultancies for the EIC Accelerator (SME Instrument)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) is an innovation funding program that provides up to €17.5M to startups and Small- and Medium-Sized Enterprises (SME). It is very attractive for eligible companies since it allows single-applicants to directly apply online and participate in the program with little to no help from third parties (read: EIC Accelerator Introduction).

Since the evaluation is performed by the European Agency for SME’s (EASME) and European Innovation Council (EIC), it appears to be the ideal framework for the European Commission (EC) to directly help excellent companies in the region.

Or so it seems.

Insufficient Documentation & Transparency

Unfortunately, many applicants who investigate the EIC Accelerator process and proposal template find that the official documentation is not entirely helpful. Instead of presenting what a good business case should be, the European Union (EU) focuses on communicating its goals for policies, gender equality, finding startup unicorns and describing innovation from a political perspective.

As a result, prospective applicants turn to professional writers and consultants since they are concerned that “they do not know what the EU wants to hear” (read: Hiring a Writer). They recognize early in the process that the EIC Accelerator is a policy-driven element, spearheaded by politicians as the primary decision-makers while entrepreneurs take an advisory role.

Becoming Entrepreneur-Friendly

The EIC is making progress in becoming more entrepreneur-friendly by aiming to be Venture Capital (VC)-like and presenting itself as a true start-up ecosystem in the EU via equity investments, pitch-oriented evaluations and expert entrepreneurs for critical evaluation steps. Unfortunately, while the EIC aims to simplify the application process, the direction the EIC Accelerator is moving towards is becoming less and less applicant-friendly.

This is not only evident in the recent equity-affair whereas granted applicants from 2019 have only received part of their equity financing in 2021 (read: Interview with EIC Fund Member) but also in the addition of more and more evaluation steps (read: Proposed 2021 Process).

Making the Application Process More Difficult

In 2018, in-person pitch interviews were introduced as an additional layer to the formerly 1-step evaluation procedure and 2021 will see the EIC Accelerator become a 3-step process which will, for the first time, include video submissions (read: Pitch Video Types). This not only increases the workload for all applicants but also requires a broad skill set which is not commonly found in DeepTech startups (i.e. design, video production, storytelling, marketing).

This clearly is a contradictory approach by the EU since adding steps to the process will increase the reliance of grant applicants on consultants and professional writers instead of reducing it (read: The Grant Writing Industry).

Understandably, the EIC is in a double bind. It wants to attract excellent companies and help them to apply without hiring external help but, by attracting an excess of applicants, it has to increase the evaluation barriers since the budget is limited. This, in combination with a less transparent evaluation process (read: Applying Early to the EIC Accelerator), leaves innovative companies no choice but to rely on external partners more than ever before.

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

The EIC Accelerator Grant Consulting Industry (SME Instrument)

In order to apply to the EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing), many startups and Small- and Medium-Sized Enterprises (SME) are looking for expert consultancies or professional writers to facilitate the ever more complex evaluation process (read: Proposed 2021 Application Process). Navigating the grant writing industry and finding a great partner to hire can be difficult but this article is aiming to shed light on the intricacies of how exactly this sector operates (read: EIC Accelerator Introduction).

Consultancies & the EU

The European Innovation Council (EIC) and European Agency for SME’s (EASME) seek to facilitate the evaluation process for innovative companies and enable them to apply autonomously but, if more and more evaluation steps with cryptic proposal templates are being added, applicants have no choice but to seek consultancy support (read: Relying on Consultancies).

The EIC Accelerator grant writing industry is characterized by a high demand from startups and, with some exceptions, increasingly selective consultancy firms. As a result, an important task that is placed on consultancies and writers is the assessment of the innovation project ahead of a potential collaboration since the requirements for written, video and in-person evaluations are becoming more and more demanding (read: Assessing a Project & Writing Internally).

Consultancy Business Models

Within this framework, there are a variety of models that consultancies follow ranging from the indiscriminative “we take everyone” to the selective “we wouldn’t even take half of the beneficiaries” approach. The reason for this discrepancy is that consultancies, like all business, have to think of their bottom line. Inevitably, this means that each company has to consider how their fee-structure can remain profitable over time and how they can maximize funded projects while compensating for projects that do not end up receiving a grant.

The general approaches are to either charge high retainer fees and low success-fees or to charge low retainer fees and very high success-fees. Variations of this approach are also found in offering extensive project-assessments via multi-day workshops, additional consulting for market scaling or through the addition of project management services for funded projects.

Regardless of what the model is, applicants will always carry the risk of investing their time and attention into a project irrespective of how the service is paid for. In the end, opportunity costs are a hidden factor in work-intensive grant applications even if the writing is outsourced to expert consultants. With the newly introduced freezing periods, this opportunity cost is increased further and startups or SME’s are better advised to judge the expertise and dedication of a consultancy rather than its business model.

Scaling vs. Quality

Scaling a consultancy business within a competitive grant like the EIC Accelerator or the Small Business Innovation Research (SBIR) program can be difficult since expertise can easily be diluted while talented experts on grant writing can be hard to find (read: Hiring a Consultant). Due to the high degree of fluctuation between the numbers of applicants per deadline, the capacities of consultancies at scale could also start to exceed the demand of excellent projects which means that they might onboard clients out of necessity rather than out of confidence.

The way most consulting companies mitigate such risks is by diversifying its revenue streams and by employing only a core team of full-time experts with clearly defined responsibilities while most of the writing is outsourced to a pool of freelancers. This can be, of course, a double-edged sword as well since having the freedom to decline clients can also lead to the possibility of onboarding more clients since scaling a consultancy over freelancers is a lucrative business model albeit to the detriment of success rates.

Still, such business models have found their own validity in the industry since there are plenty of startups who, after having been told that a grant application would be too high risk, are still determined to move on regardless.

Good vs. Bad

This assessment does not mean that large consultancies are inferior to small consultancies or vice versa. On the contrary, it sheds light on the fact that the size or business model of the consultancy is less important than its modus operandi and its internal incentive-structure. The traits exhibited by excellent consultancies are selectiveness, transparency and dedication but these are entirely independent of the business model and scale. They are only evident in direct communication with the consultants themselves.

Every prospective grant applicant should know who exactly will write the proposal, who else will be involved (i.e. editor, pitch-expert, designer, videographer) and if the team will be changed throughout the duration of the contract. This, in addition to requesting an in-depth project assessment beforehand, can prevent a negative experience for the startup or SME since a consultancy that cannot be transparent in this regard or lacks certainty will likely place less focus on each respective client (read: Assessing an Innovation).

Conclusion

In summary, each prospect EIC Accelerator grant applicant should pose the following questions to a consultancy prior to beginning a collaboration:

  • How does our company compare to the businesses that typically receive EIC Accelerator funding (i.e. industry, team, innovation)?
  • Who will be writing the proposal and will the writer be exchanged throughout the process?
  • Who will be our fixed contact point at the consultancy for the duration of the project?
  • Has our project been sufficiently vetted prior to beginning a collaboration?
  • Does the writer understand the intricacies of our innovation project and business model?

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

How a Consultant can Produce an EIC Accelerator Pitch Video Remotely (SME Instrument) – Part 2

This article is a continuation of Part 1 and presents a proposed workflow for the creation of a pitch video for the EIC Accelerator blended financing program (formerly SME Instrument Phase 2 – grant and equity financing). Due to the new process under Horizon Europe (2021-2027), the pitch video will be an additional barrier for startups and Small- and Medium-Sized Enterprises (SME) to apply for the grant financing and increase their reliance on consultancies and professional writers (read: Relying on Consultants).

Since the official proposal template and work programme will likely not provide sufficient guidance, the following content aims to remedy the most pressing concerns of future applicants (read: EIC Accelerator Introduction).

1.2 Discussing the Resources Available

The KOM should likewise be used to clarify the resources and capabilities an applicant has at their disposal. This includes the available footage (i.e. produced videos, features, animations) and the available hardware such as cameras, lights and related equipment (read: Types of Pitch Videos). Many smartphones can already record high-definition (HD) footage while Digital Single-Lens Reflex (DSLR) cameras are quite common as well.

Lastly, the SME’s team should clarify the locations and capabilities of their members so that tasks can be distributed accordingly and the shooting of the pitch video can be timed appropriately. If some employees have experience with video production then the process can be facilitated greatly while having all of the team members meet in a single location for a joint video can be beneficial.

1.3 Guidance for Best Practises

If no suitable expertise is available in a startup, the consultancy should provide a shortlist of best practises helping the team to maximize the quality of the production. These should include tutorials, Frequently Asked Questions (FAQ), tips & tricks as well as recommendations for camera settings, lights and related topics.

Most of this information is easy to learn and readily available but a brief guideline targeted at short EIC Accelerator grant pitch videos is expected to significantly benefit the production quality. If the team has no time to perform the shooting themselves, an external videography team can also be contracted for an on-site project.

1.4 Creating the Script

Before the shooting begins, the script should be prepared by the professional writer or consultant so that the production can be planned in advance. The script should clearly identify the content, speakers and setting so that the applicant understands the requirements and resources that are needed.

Preparing a script is complementary to the proposal writing and the pitch deck creation with the exception that the storytelling can be much more creative. The storyline of the video should be clear to all participants and care should be taken that the script is rich enough to not require any additional footage collection at a later stage. It is better to include additional content in the first script but cut it from the final video rather than to shoot less but then require a re-shoot at a later stage.

1.5 Screen Test (optional)

After the script has been created, the company should proceed with a first screen test where the team takes a few hours to create the video content to the best of their abilities. This includes the set-up of the lighting, camera settings, microphone and the final recording at the respective set.

This stage is supposed to be a low-stakes practise run but, if the footage is high-quality, it could be directly used for the pitch video. Once the screen test has been recorded, it can be reviewed and discussed with the consultant or writer to optimize the content, script and execution of the shoot.

1.6 The Real Recording

After the screen test has been reviewed and the script and execution have been corrected, the applicant will take a second day to perform the recording and collect all of the required footage. This 2-stage production will likely provide superior results and allow the creation of a high-quality end product with little effort or overhead.

1.7 Editing and Exporting the Pitch Video

Lastly, the editing of the footage can be performed either by the consultancy, a third-party contractor or a team member of the startup depending on how responsibilities have been distributed in the agreement. The editing will be an essential step to assure that colour grading, basic corrections, audio enhancements as well as related aspects are all exhibiting the highest quality.

Afterwards, the final video can be exported in the appropriate format and be ready for the first submission.

2. Summary

A process for the remote production of the EIC Accelerator pitch video could be structured as follows:

  1. Planning the Process: Discussing the core responsibilities of the shoot.
  2. Discussing the Resources Available: Reviewing the availability of equipment and skills.
  3. Guidance for Best Practises: The provision of guidelines to facilitate the production.
  4. Creating the Script: Developing a comprehensive script to avoid re-shoots at a later stage.
  5. Screen Test: A practice run (optional).
  6. The Real Recording: Recording the final video footage.
  7. Editing and Exporting the Pitch Video: Editing to increase the quality and export within file size restrictions.

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

How a Consultant can Produce an EIC Accelerator Pitch Video Remotely (SME Instrument) – Part 1

In 2021, the new EIC Accelerator blended financing program (formerly SME Instrument Phase 2 – grant and equity financing) will include a more sophisticated 3-step evaluation process which includes a pitch video (read: Proposed 2021 EIC Accelerator Process). This will likely place an additional burden on Small- and Medium-Sized Enterprises (SME) and professional writers or consultancies since video production is rarely part of their established skill set (read: Pitch Video).

While the pitch video is an interesting addition to the evaluation process, it is also a new challenge for early-stage startups who often lack the funds for video production or DeepTech companies who are less focused on marketing compared to a digital innovator. Additionally, producing a video can take a lot of time and, as opposed to written content or a pitch deck for the interviews, it must be created in person which places a significant burden on both startups and consultancies.

Implications of the Pitch Video

Just by introducing the pitch video, the European Innovation Council (EIC) has directly increased the reliance of startups on consultancies which, in many cases, have to perform an in-person video production (read: Relying on Consultants). Unfortunately, adding another layer of expertise to the evaluation process only widens the gap between an excellent project and a funded project since consultancy support becomes increasingly indispensable for applicants.

The greatest challenge for new applicants will come in the form of planning the video creation since, while editing a proposal over multiple re-submissions is common, re-editing a video is resource-intensive if it includes additional video production. As a result, the video should be perfect right from the start which means that the narrative of the project and proposal have to be perfected in the beginning so that the correct footage can be collected in a single day and does not need to be re-recorded continuously. More than anything, planning the video production will become a major burden for applicants.

Even if a company is working with an expert video production team, understanding what a resulting pitch video must contain and synchronizing its message with the written application and pitch deck will be a challenge. Often, companies are in a position of having limited funds, limited grant writing experience and have a lack of video footage or production skills. In such a situation, creating a framework to simplify the process of a remote and lean video production should be a must for the EIC and European Commission (EC).

1. Remote Video Production Workflow

Since the official proposal template and documentation are likely unable to provide suitable guidance for applicants, this article will present a proposed workflow for the creation of a pitch video in a remote fashion. Preparing a video remotely will remain the most efficient way for both consultancies and applicants but there are a variety of barriers to this workflow. The following is a shortlist of concerns from clients:

  • There is no video footage available
  • The company has no camera or related equipment
  • The team lacks video production skills or suitable contractors
  • The team is unable to script a video
  • All employees are working remotely and are not in the same city or country
  • The team is unfamiliar with editing software such as Adobe Premiere Pro

These points can be a challenge but are still surmountable through meticulous planning and guidance from a consultancy, writer or freelancer.

1.1 Planning the Process

The normal work-flow when collaborating with a consultancy or writer is to start with a prolonged Kick-Off Meeting (KOM) to discuss the project with the founders of the company and the writing-team. This precedes every other task and has the purpose of bringing everyone on the same page while defining the project and its scope.

Adjusting this process to include video scripting can simply be done by taking the time to define the core messages that need to be communicated for a particular project (read: How to Script a Pitch Video). These should be customized to every startup since the ingenious aspects of a technology or business model will likely vary greatly from company to company.

This article continues in Part 2.

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

Helpful Resources for an EIC Accelerator Pitch Video (SME Instrument)

In 2021, the EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) will include a video pitch as a new proposal document which is expected to place an additional burden on applying startups and Small- and Medium-Sized Enterprises (SME). While tips on choosing an appropriate video type (read: Types of Pitch Videos) and the scripting process (read: Scripting a Pitch Video) can be found elsewhere, this article will focus on the resources that can be used for the actual editing process.

While the European Innovation Council (EIC) will likely not provide sufficient material as part of the official proposal template or guidelines, professional writers and consultancies should have access to a variety of resources needed for video production such as video clips, background music, images and software. These will likely become indispensable since a hired consultant must be able to efficiently coordinate all aspects of the production (read: Remote Video Production Workflow).

1. Resources for Stock Music

Royalty-free music or music under the Creative Commons license is readily available for creators but their exact licencing conditions can vary greatly. Such variations come in the form of attributions, commercial use, regional restrictions or the type of project it is used for. Since the EIC Accelerator proposal is confidential and should only be viewed by the European Agency for SME’s (EASME) evaluators and pitch interview jurors, there should generally be no problem in using copyrighted music but it could be a problem if the video finds its way online.

Since the company name will be directly linked to the video content, it would be best to only use non-copyrighted music or to pay for the use of a certain license. The advantage of this approach is also that the video can be shared more freely on social media or with a variety of investors who have shown interest in the project.

  • Pixabay is a great resource for free music under the Creative Commons licence whereas commercial use is allowed and no attribution of the composer is required.
  • SoundCloud and YouTube contain a variety of channels that do advertise royalty-free music but these are sometimes part of a complex licensing structure and are not entirely free. Still, its worth having a look since they contain a large number of different tracks.
  • The FreeMusicArchive contains a multitude of different songs but care should be placed on their exact licencing conditions.
  • CreativeCommons.Org has created a shortlist of sources for music under a creative commons license.
  • Websites such as AudioJungle, ShutterStock or AdobeStock are premium services which offer high-quality music at a low price as a subscription or one-off purchase.

2. Resources for Stock Video

  • PixaBay tops the list once again with its video archive where attribution and cost-free video clips can be found. Many of the items are of high-quality and will likely meet most short-video production needs.
  • Pexels is similar to PixaBay and offers attribution-free stock videos for free.
  • Videezy likewise offers free video footage but also includes premium content that can be purchased for a small price.
  • AdobeStock and ShutterStock, once again, offer subscription or one-off purchases of stock footage with high quality. Since such libraries are highly curated, one can expect to find more customized footage on these platforms but most free alternatives are also presenting a competitive portfolio.

3. Resources for Stock Images

  • Unsplash and PixaBay are great resources not only for pitch videos but also for grant proposal writing (read: Design Templates for Grant Writing). They offer cost- and attribution-free photos and designs for commercial use. From experience, Unsplash usually offers better content for certain keywords and the images tend to be higher in quality.
  • Pexels offers a Freemium model for stock images wheres some can be used for free while others are behind a paywall but the costs are still very low.
  • iStockPhoto, ShutterStock and AdobeStock offer high-quality and curated photo libraries for commercial use with a variety of pricing plans.

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

An Inside Look into the EIC Accelerator Fund and its Equity Financing (SME Instrument)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) is a highly competitive program that is slowly evolving into a fully fletched startup financing initiative (read: EIC Accelerator Introduction). Unfortunately, the latest developments regarding its equity financing have led to confusion and criticism as it was expressed in a recent Politico article.

The first startups and Small- and Medium-Sized Enterprises (SME) who have successfully obtained EIC Accelerator financing under the blended funding program in 2019 had to wait for over a year to receive their first equity payment which means that the funding was promised but only provided with a significant delay while some companies are still waiting for their first payment.

This, of course, can be detrimental to many businesses that have passed the exceedingly difficult evaluation process and managed to win the EIC Accelerator grant against odds of 1-5%. With the 2021 template seeing the introduction of even more steps to the process (i.e. a small application and a video pitch) and more restrictions (i.e. freezing periods upon rejection), many applicants are requesting additional clarifications before even considering to apply for the blended financing program (read: Proposed 2021 Process)

To inform applicants as well as professional grant writers and consultancies, Stéphane Ouaki, the chair of the investment committee of the EIC Fund, has been answering the most critical questions on the TechEU Podcast regarding the internal process of equity financing under the European Innovation Council (EIC) Fund as well as the remote evaluation performed by the European Agency for SME’s (EASME). This article presents a short summary of the key takeaways of the conversation.

Grant vs. Equity

> While the grant funding process is fast and has been perfected over the past decade, the equity financing is still very new for the European Commission (EC) since it is a government body and not a private investor (read: Grant vs. Equity).

> The grant financing is usually provided within one or two months through an initial upfront payment but the equity financing must undergo additional due diligence which should last 6 months on average but can also last 9-12 month in some cases. Comment: This could likely be accelerated significantly if the EIC presents a list of required materials ahead of time so that 80% of files can be uploaded as soon as the equity financing is awarded.

Due Diligence and Timing

> The equity payment is not provided in a stand-alone fashion like the grant payment but is envisioned to be supplementary to a financing round with other investors which has to be planned by the company itself. Comment: This means that, if there are no financing rounds with other investors planned, the EIC Fund will likely not invest. It also means that the financing is delayed depending on the timing of the next financing round.

> If the applicant has been successfully awarded the EIC Accelerator blended financing and coincidentally also performs a financing round at that time, the EIC Fund can directly invest in the startup, provided the due diligence has been completed.

> The full equity financing will be paid in 2-3 separate trenches in most cases.

> If the due diligence for the equity financing has a positive result but no financing round is in progress, the EIC Fund can immediately invest through a convertible note which averages 50% of the agreed-upon equity financing. Less is given through the convertible note if the due diligence deems the company to be sufficiently financed.

> Since blended financing always includes a grant component that is paid in a much faster manner, no company should be in financial difficulties once the EIC Accelerator has been granted.

Behind the Scenes

> The advisory board of the EIC Fund is having weekly meetings and is working hard on making the equity process as smooth as possible but mistakes will be made throughout this pilot phase.

> If the company performs a financing round with non-EU investors then this will not negatively impact the EIC’s equity investment.

> The due diligence can directly impact the granted equity financing whereas the amounts could be reduced or entirely cancelled if the EIC deems the beneficiary to not fit their criteria any longer.

> The EIC can place a private industry representative in the company board if it deems this to be necessary but there is currently no infrastructure available to facilitate this process at scale.

> Equity applications have not been prioritized over grants even though many rumours and experiences might suggest otherwise. If equity financing was used to fund grant-applicants then this was directly related to the Technology Readiness Levels (TRL) of the funded activities (read: TRL and TRL Funding). Comment: The TRL designations are often up for interpretation and it is possible that TRL’s were effectively used to funnel more applicants towards equity financing due to limited grant budgets.

Comments on the Politico Article

> The complaints expressed in the Politico article have not reached the EIC Fund representatives. Comment: This is understandable since business-making or -breaking money is involved and complaints will only make things worse – not better.

> Complaints regarding the due diligence and long delays are likely stemming from a comparison to the EU’s smooth grant approval process which is much simpler and faster. Comment: Saying that startups are „used to the smooth grant process“ and that this is the reason for complaints is unlikely since many funded companies are first-time EU-applicants. Even though they can directly compare grant and equity proceedings through the blended financing program, they are more likely to be used to a private due diligence process and compare the EU’s performance to that.

> Companies who were awarded the equity financing in the highly competitive process expected to receive the promised awards from the EIC Fund but were told to find other investors first. The EIC Fund’s position is that companies have to be proactive in raising investments while the EIC Accelerator beneficiaries were shocked that they did not receive the funding after having been promised a specific amount. Comment: Both are correct but the EIC should have been transparent about this from the very beginning since the way it described equity investments in its guidelines, in hindsight, was deceptive.

Vague Answers

> The question regarding the discrepancy between the grant and the equity due diligence did not receive a direct answer but it is an excellent question since both are government funds and should face similar scrutiny. The answer detailed how the due diligence for equity financing is more in-depth but it does not clarify why the grant payout is possible without it. Comment: Since equity stakes, long term associations with the EU and the potential placements of board members are involved, it is evident why a due diligence process would be necessary. In addition, the mentioned ranking system for grant evaluations performed by EASME will likely disappear in 2021 due to the absence of a scoring system. This can make the grant evaluation process less transparent and likely more ‘bumpy’ as well.

> As the last interview question, the criteria of non-bankability was further investigated. The interviewer simply asked if the EIC is looking for success cases or for non-bankability cases as their first priority (read: EU Buzzwords). The answer is: Success cases. Comment: This answer was given in a very vague manner and evaluators, either remote or in the pitch jury, might not share this priority.

Conclusion

In summary, the negative experiences of the companies that have applied for equity financing under the EIC Accelerator all stem from a lack of communication from the side of the EIC but this is understandable since the funding is called the ‘EIC Accelerator Pilot’ for a reason. The governing bodies are still in the learning process and the 2021 version of the EIC Accelerator under Horizon Europe (2021-2027) will likely remedy most of the reported issues.

Still, the EC and EIC clearly neglected their responsibility to explain the nature of the funding ahead of time. Even though equity guidelines were available specifically for this purpose, they did not include any of the critical information provided above.

Moving forward, companies have to be aware of the timing of payments, the ongoing scrutiny (i.e. pulling of funds can potentially happen at any time), the delays caused by a slow due diligence process and of the EIC’s preference to only invest in existing or planned financing rounds. The advisory board and decision-makers of the EIC Fund have learned valuable lessons in this initial pilot phase of the EIC Accelerator and are expecting to launch a more transparent and smooth version of the program soon.

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

Why It Could Be Beneficial to Apply Early to the 2021 EIC Accelerator (SME Instrument)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) will be reinstated in 2021 under Horizon Europe (2021-2027) with an updated evaluation process (read: Proposed 2021 Process). This will likely present new challenges to the evaluation procedure as lead by European Agency for SME’s (EASME) and the European Innovation Council (EIC) but it can also present improved opportunities for startups and Small- and Medium-Sized Enterprises (SME).

Consultants and professional writers should be aware that such a new process can artificially tilt the success chances of grant applications since a continuously open call (i.e. Step 1) can lead to a bottleneck in Step 2 which makes the timing of the application essential. The following presents a list of considerations and assumptions that can impact the evaluation process:

  • Open deadline: Since Step 1 will be continuously open, each applicant that applies early and receives a YES will have a guaranteed spot for the Step 2 evaluation
  • YES or NO grading only: Since there is no numeric scoring, it is likely that proposals will not be ranked which means that every YES will have to be invited to Step 2 (i.e. no retrospective rejection due to rankings)
  • Limited spots for Step 2: If the EIC and EASME realize in April or May 2021 (i.e. the next deadline for Step 2 is in June 2021 – see Cut-Off) that there are too many YES gradings for Step 1 already, this might significantly impact the success chances of late Step 1 applicants.

The above reasoning is highly speculative but it is likely that the new evaluation process will undergo an equilibration phase during which the thresholds need to be adjusted in some way. In the past, a score of 13 acted as the official funding threshold while the unofficial threshold (i.e. 13.5 to 14.1) was determined through rankings enabled by the scoring system. Without such a scoring system to determine the rankings, the EIC has no way of limiting the numbers of applications other than to increase the strictness of the YES/NO evaluations dynamically which can lead to unfair results.

Assuming that the EASME will not, in secret, employ an internal ranking system with scores (i.e. without communicating this to applicants) then the same logic would apply to Step 2. A single evaluation round of the full step 2 proposals could lead to an excess of applications for step 3 and, since there is no ranking, the Step 2 evaluation process must be repeated but more strictly. What strictly would mean in this case is not clear but it seems like a less transparent method of evaluating proposals compared to the 2020 process.

Conclusion

It is impossible to estimate the impact of the 2021 EIC Accelerator grant application process but this uncertainty could be mitigated through clear communication from the EASME and the EIC as to how certain thresholds are set and enforced (i.e. by providing real-time updates on YES and NO counts and thresholds). This extends to clear communication if evaluation steps are repeated internally in case applications exceed the capacities for subsequent evaluation steps. This is especially useful if an applicant can choose less competitive EIC Accelerator topics or if the timing of the application is not fixed (i.e. postponing an application to avoid the freezing period).

In summary, it could be beneficial for applicants to apply to Step 1 of the EIC Accelerator in 2021 as soon as possible since an early YES will guarantee a spot to the Step 2 evaluation while this might be significantly more difficult the later one applies.

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). 

Any more questions? View the Frequently Asked Questions (FAQ) section.

Want to see all articles? They can be found here.

For Updates: Join this Newsletter!



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:

Professional Grant Proposal Writing for the EIC Accelerator and Horizon Europe Programs (SME Instrument)