Tag Archives: EIC Accelerator pilot

The New EIC Accelerators Read Deck (SME Instrument)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity) has recently introduced a new type of pitch deck for Step 1 of the evaluation process. This can be viewed as a ‘real-only deck‘ or a ‘read deck‘ since it will not be used for the Step 3 interviews (read: Interview Preparation) but simply acts as a reference for the evaluators.

This is an interesting experiment on the side of the European Commission (EC) since the read deck has no technical restrictions outside of the page limit. This means that this is, for the first time, a PDF document that can be uploaded with full creative freedom with regard to font sizes, formatting, margins, sections and all related aspects.

Depending on how this experiment will turn out, it could be short-lived since it needs only a few bold applicants who exploit the lack of restrictions and aim to upload a full 10-page business plan with small font sizes and slim margins. Technically, such an unconventional Step 1 pitch document would have to be evaluated by the reviewers since it does not violate the application requirements.

It can be expected that strict rules, similar to the ones for the previous full applications, will be enforced after 2021 to avoid such exploitations.

Nonetheless, this article explores some ways the read deck could be treated and how it can differ from the pitch reck. A detailed look at the types of slides to choose (read: Pitch Deck) and information on the pitch interviews (read: Pitch Success) can be found elsewhere.

General Information and Restrictions

  • Must be a PDF
  • 10-page limit
  • Below 10 MB
  • This read deck is not used for the Step 3 pitch interview (“read-only deck”)

Changes for the Pitch Interview Deck

Interestingly, the original pitch deck used in Step 3 has fewer limitations since it does not have a page limit. This is likely due to the nature of its use whereas all applicants know that they will be heavily judged for a ‘bad‘ pitch deck and it is their own responsibility to look good in front of the jury.

This changes with the read deck since the impression made on the evaluators will be without the 10 minute time constraints of the interview and entirely lack a verbal component or live feedback. In fact, the read deck, when compared to the pitch deck, has to stand entirely on its own and must hold up to close scrutiny which is not limited by time pressure.

Slides to Omit

Since 10 slides are valuable digital real estate, the title and ending slides should be omitted. There is no need to account for any social aspects such as introducing the speakers or thanking the audience for listening to the pitch since all this information is available to the evaluator already (read: A Broad Vision).

The same is true for extensive product presentations that can be flipped through like a dia show during the interview but take up too much space in a 10-page read deck. If the presentation of the product critically needs to be in the form of multiple angles or images then this should be reduced to a single slide and the remaining footage can be part of the pitch video. In fact, the video is an excellent choice for the presentation of the product in a comprehensive and visual way.

Changing the Text

Since speakers cannot leave certain aspects of the project to the Questions and Answers part of the EIC Accelerator pitch interviews, the text should be comprehensive. To stand on its own, the traditionally scarce text on a pitch deck should be elaborated for the read deck.

Instead of adding only bullet points and keywords, the read deck should have full sentences on each slide to explain the concepts without leaving any doubt in the reviewer’s mind. Since verbally expressing the traction of the company and their pilot customer is impossible in the Step 1 deck, it should be laid out in a written form.

This is likely the most important aspect of the new read deck since most pitch decks aim to avoid text as much as possible and present a clean and elegant design. The read deck, on the other hand, requires a merger of elegant simplicity and a fully fletched text.

Graphics and Photos

Graphics already used to be an important part of every pitch deck but, even though the read deck will contain more text, graphics also become even more important. While an introduction slide could lean heavily on the speaker’s voice and simply present a small chart as support, the read deck will require graphics to transmit a full concept with little to no support (read: Design Resources).

Illustrations cannot be too minimalistic in the read deck but have to be comprehensive enough to transmit a complex idea. This approach is supported by the fact that there is no time limit. The evaluator can stop at a single slide for 5 minutes or more and let a complicated chart sink in. They can also go back to the chart after they have watched the video and have read the entire application – or right before they give their final verdict on the proposal’s success or failure.

It is advisable to put great thought into this aspect and find a balance between easy-to-digest and enough-to-understand.

Summary

  • Restrictions: 10 slides as a PDF below 10MB
  • Slides to Omit: Remove title and ending slides to save space.
  • Changing the Text: Full sentences to explain all relevant concepts in detail.
  • Graphics: These can be more complex than in a traditional pitch deck since the evaluator can pause indefinitely.

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:

Glitches on the EIC Accelerator’s AI Platform and Changes to the Work Programme (SME Instrument)

In 2021, the EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity) has been re-launched into its most sophisticated iteration yet. With a new AI Tool, a semi-automated evaluation process and a clear focus on disruptive projects, it has now opened its doors for Small- and Medium-Sized Enterprises (SME) and startups in the European Union (EU) and associated countries (read: New Process).

Right after the launch of this new platform, many applicants as well as professional writers, freelancers and consultants have noticed that there were still quite a few errors and glitches that showed up. This article presents a shortlist of noticeable areas that were affected by such glitches and also discusses some of the changes to the 2021 Work Programme which differ from the unpublished draft version discussed earlier (read: The Work Programme).

Changes & Glitches

Geographic Restrictions & Diversity

The draft version of the EIC Accelerator Work Programme discussed the requirement for geographic diversity which meant that all applicants applying to the grant would need to be invited to the Step 3 interviews in proportion to the number of received applications (read: Interview Preparation & How To Succeed). This would have been an extreme measure since it could have incentivised countries to prepare many low-quality applications to boost their chances in Step 3 of the process. Luckily, this rule was removed.

Non-Binary Gender

The latest template for the EIC Accelerator’s AI Platform and the draft for Horizon Europe proposals indicated non-binary as an option for the gender selection of the applicant’s CEO (read: The EIC Youtube Leak). This, of course, was an example of the European Union being too progressive for its own good (read: Gender Identification vs. Gender Equality).

The EU’s strong gender equity agenda enforces the funding of 35% female CEO’s under the EIC Accelerator which presents 7-times the number at which female CEO’s would naturally be funded in the program. If a non-binary CEO who was born as a woman was treated like a man with respect to this agenda or, even worse, a transgender person identifying as a woman was treated like a man – the EU would have a political disaster on their hands.

Eventually, the European Innovation Council (EIC) has decided that this political double bind between gender identification and gender equality was too much to handle and reverted back to giving only a single third gender option: Unspecified – which is treated as male and lacks the benefits of choosing female.

TRL Descriptions

The Technology Readies Levels (TRL) and Market Readiness Levels (MRL) have been changed even after the opening of the call on April 9th whereas on Friday, it still stated that TRL6 required 100 customers, while on Monday, it reverted back to only requiring pilot studies and a prototype. This is significant since the change happened after the call was already open which means that many applicants could have applied under false premises (read: TRL Levels Explained).

AI Tool Diagnostics Results

Another change over the weekend after April 9th was that the Diagnostics evaluation feedback by the AI Tools changed drastically. The technical breakthrough scorings were quite easy to ‘max out‘ to the top of the A-chart while breakthrough scientific scores were much harder to increase. On Monday, the scoring difficulty was reversed even though no changes were made to the proposal text.

On Monday, an A in technical scores can have turned into a B while the scientific scores saw the opposite change happen. Once again, there are a number of applicants who might have applied under false premises since the call was already accepting submissions.

Budget & Evaluation

The Work Programme has seen some minor adjustments in the budgeting and evaluation process but these were not dramatic and will not significantly impact the success chances of applicants.

One relevant part of these changes is the automatic coverage of the 30% co-financing of the grant by the equity financing if blended financing is selected. This means that, if an applicant wants to request €5M in equity from the EIC Fund then this will be in addition to the 30% of the grant contribution (read: EIC Fund Behind the Scenes). Applicants also have to estimate the co-financing of their Series A or similar round and identify the outside contributors.

Glitches and Errors

Since the AI Platform for the EIC Accelerator is new, it is expected that bugs and errors will be encountered frequently. Still, there was a discrepancy in the performance between different accounts whereas one account had a smooth opening and saving of the proposal while others were exhibiting long loading times, errors and shutdowns.

One of the most severe glitches observed was the replacement of the Abstract of the proposal by the Solution section which ended up appearing twice in the final proposal. This was an automatic replacement that happened in some accounts over the weekend after April 9th.

For all applicants who have applied early to the EIC Accelerator, it is worth looking back at their submitted application and double checking if their Abstract was affected. If it was, it is advisable to contact [email protected] as soon as possible to correct this error so that the evaluation will not suffer from this mistake.

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 2021 EIC Accelerator Work Programme and Newest Updates (SME Instrument Phase 2)

Update 1: The EIC Accelerator Work Programme 2021 was published on March 17th 2021.

Update 2: The EIC has presented the latest news in a YouTube leak which reveals information not found in the published Work Programme.

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) is being re-invented and is transitioning from its initial pilot phase into a fully-fledged investment arm of the European Commission (EC) and European Innovation Council (EIC). With the launch of the EIC Accelerator in 2021 having been announced for March 18th 2021, this article discusses the most important aspects of the new Work Programme (read: EIC Accelerator Introduction).

The new Work Programme includes a different application process, additional evaluation steps and significant technical changes that are relevant for both Small- and Medium-Sized Enterprises (SME) and startups as well as for professional writers and consultants focusing on preparing successful grant applications (read: Hiring a Consultant).

While the official template for the proposal documents is not published yet, conclusions regarding their set-up can be drawn from the evaluation criteria themselves. All information given in this article is still preliminary but is expected to accurately reflect how the EIC Accelerator will look like under Horizon Europe (2021-2027).

1. General Changes

1.1 Open Calls vs. Strategic Challenges

The EIC Accelerator will follow the previous SME Instrument’s strategy of imposing certain topic restrictions on applicants whereas all applicants will remain eligible for Open Calls but only select projects can apply to the Strategic Challenges. Accordingly, each funding arm will receive its own budget and be subject to specific guidelines with respect to the types of companies that are selected as well as their impact on the EU’s key policy targets.

1.2 Scoring & Ranking System

While the EIC Pathfinder and the EIC Transition will still include scoring and ranking systems, the EIC Accelerator will entirely omit such evaluation methods and solely rely on YES/NO gradings for every step. As discussed in a previous article (read: Analyzing Success Rates for Each Step), this might lead to a non-transparent evaluation process whereas rankings will have to be established internally since this is the only way of controlling the number of beneficiaries.

If there were truly neither thresholds nor rankings then there would likely be an excess of applications successfully progressing to the third evaluation step since the previous EIC Accelerator instalment already saw 30+% of all companies reaching the quality threshold of 13. Only a subsequent ranking process was able to reduce that number to a manageable amount for the interview stage.

1.3 UK Participation

After Brexit, the UK will participate in the EIC Accelerator grant but will not be eligible for equity financing (read: The United Kingdom under Horizon Europe). This, of course, is not to the detriment of UK companies since non-dilutive grants are increasingly sought after and there is no additional risk of receiving an equity-counter-offer that would replace the requested grant.

2. The Application Documents

2.1 Step 1: The Short Application

This first stage will require the preparation of a 5-pager to summarize the project in written form, a 3-minute pitch video and the conventional pitch deck which will later be used for the Step 3 interview.

≥ 5-Pager: The 5-pager does not currently have an official proposal template yet but conclusions can be drawn from the Evaluation Summary Report (ESR) criteria in the newest EIC Accelerator work packages (not shown here). The document will likely focus on the Excellence and Impact of the technology with very broad questions regarding its key aspects and why the EU should be interested in the project (see DARPA’s Heilmeier Catechism). The Implementation will receive less attention and only address the quality of the team and the overall risk level of the project (read: Assessing an EIC Accelerator Project).

The EU has additionally given hints at the 5-pager template through its public tender for an Artificial Intelligence (AI)-driven writing support tool which further illuminates the direction it will take. All in all, the 5-pager should be viewed as a compressed version of the previous full application with a stronger focus on being impressive rather than being detailed or feasible (read: Identifying a Broad Vision).

≥ Pitch Video: The 3-minute pitch video will likely have no restrictions and give full creative freedom to the applicants (read: Pitch Video Production) but it should be treated as a project pitch that is addressing all criteria rather than an advertisement (read: Pitch Video Resources).

≥ Pitch Deck: The pitch deck will likely follow the exact same structure as the previous installations of the Step 3 interviews (read: Pitch Deck Creation).

2.2 Step 2: The Full Application

Once Step 1 is passed, the applicants will be invited to submit a full application to the evaluators which will likely be a 20-30 page document that includes the business plan, financials, work packages as well as annexes that contain information on the company (read: EU Work Packages).

2.3 Step 3: The Remote or In-Person Interview

This step will follow the same structure as previous interviews (read: Preparing for an Interview & The Biggest Mistakes).

3. The Application Process

The application process will likely see great changes with the introduction of an online tool supported by an AI-interface similar to web-based word processors, a re-invented Funding and Tenders Portal as well as the introduction of freezing periods for unsuccessful applicants. It is evident that the EIC has put great thought into increasing the quality of applications but also into filtering out low-quality projects early.

3.1 AI Tool

Similar to GoogleDocs, this web-interface is meant to be used for the writing of the proposal and should give useful assessments and guidelines to support the process. The exact details and its release date are not clear yet but it could be a valuable way of providing immediate feedback to low-quality applications.

3.2 Freezing Periods

≥ Two Attempts: The general approach is to give rejected companies a second attempt while they will be blocked for 12 months from further submissions if they cannot succeed in a respective evaluation Step on their second try. The rules are more complex when it comes to the rejections in Step 3 but all applicants should assume that two attempts are all they will have available and that no submission should be wasted.

Consultants and professional writers often receive inquiries from companies who have applied to the EIC Accelerator on their own but failed, prompting them to seek support from an expert. This was always a great option for startups because there was no risk in preparing an application in-house since professionals could still be hired down the road (read: Should you apply on your Own? & Getting Good at Grant Writing).

Unfortunately, this is currently changing since the risk of failing is now associated with being blocked from any further applications for at least one year and maybe even indefinitely when it comes to a particular company or project. It is expected that many applicants will now seek professional help before even applying on their own to minimize their risk while there could also be a large number of unsuccessful companies seeking out writing support with one out of two rejections already received (read: EIC Accelerator Consulting Industry).

≥ Virgin Projects: Since such freezing periods are a new concept, there will likely be a new focus among professional writers and consultants on virgin projects which have not applied to the EIC Accelerator yet and have a lower risk for rejection. This is expected to become a major factor since success-fees and -rates are key for consultancies while investing time and resources into a project with only one remaining attempt can become an unreasonable risk.

Undoubtedly, the latter risk consideration will prompt consultancies to adjust their pricing model specifically for one-time EIC Accelerator rejectees. As with everything, good intentions can backfire and the EIC’s radical changes to the evaluation process, depending on how they will unfold, could end up harming the startups and SME’s they aim to support.

4. The Evaluation Process

Without scoring, without a transparent ranking system and with automated AI-tools, the evaluation process will change drastically. In the past, the pool of evaluators used for the assessment of applications has frequently faced criticism but the new installation of the EIC Accelerator might mitigate this depending on how the changes will be implemented. One major improvement is the introduction of concrete feedback for rejected applicants, although its exact nature is unknown at this point.

4.1 Step 1

Two evaluators will decide, unanimously, if the application is approved or rejected. If their opinions differ, two new evaluators will be added and the application will be successful if only one of them approves all evaluation criteria. This means that a proposal can win Step 1 if the result is 2/2 or if it is 2/4, provided the approvals are given for all evaluation criteria.

4.2 Step 2

Three evaluators will assess all criteria as in the previous EIC Accelerator installation. They will now also gain access to automated data analysis tools to cross-reference metrics and collect relevant data but the details for this AI tool are not known yet.

4.3 Step 3

6 jurors will evaluate the pitch and have access to all previous applications and feedback. They can also suggest lower grant amounts to be offered in case TRL8+ activities are detected or make a counter-offer consisting of equity financing but they are unable to provide more funding than has been requested (read: Technology Readiness Levels & How the EU Funds TRL’s).

5. Strategic Challenges (Topics)

Outside of the open calls, the newly introduced topics will focus on (1) the green deal, (2a) digital technologies and (2b) health care.

For (1) the Green Deal, 50% of companies invited to the Step 3 pitch have to address (a) batteries and energy stage, (b) green hydrogen and (c) renovation (read: A Proposal Narrative). For (2a) digital technologies and (2b) health care, 40% of interviewees have to address each sub-topic.

Open calls and specific topics will be available in parallel which means that companies have to decide which call they apply to.

5.1 The Green Deal Strategic Challenge (1)

The Green Deal will aim to target the following environmental goals in a similar fashion as the dedicated cut-off in May 2020 (read: The Green Deal EIC Accelerator):

  • Climate mitigation
  • Clean, affordable and secure energy
  • Clean industry & circular economy
  • Efficient building and renovating
  • Sustainable and smart mobility
  • Fair, healthy and environmentally-friendly food system’s
  • Preserving and restoring ecosystems and biodiversity
  • Zero pollution and a toxin-free environment

Specifically, the following technologies and areas are sought after under the 2021 EIC Accelerator Strategic Challenges for the Green Deal:

  • Batteries and Energy Storage: Strategic battery value chain • critical raw materials • recycling • chemical as well as physical storage (including ultracapacitors) • stationary and transport applications.
  • Green Hydrogen: Produce and store renewable hydrogen • different scales • centralized to on-demand • stationary and transport applications.
  • Renovation: Accelerate the growth of the renovation market • energy-efficient buildings • innovative technologies • financial schemes or business models.
  • Low-carbon Industry: De-carbonisation of industries • electrification • circularity • industrial symbiosis • industrial processes • carbon capture storage • digitisation of industrial processes.

5.2 The Digital Technology Strategic Challenge (2a)

≥ Digital technologies: Information and communications technology (ICT) • advanced high-performance computing • edge computing • quantum technologies • cybersecurity • artificial intelligence • block-chain • cloud infrastructure technologies • Internet of Things (IoT).

5.3 The Healthcare Strategic Challenge (2b)

≥ Healthcare technologies: AI-driven diagnostics • point-of-care (POC) diagnostics • cell and gene therapy (esp. cancer) • novel biomarkers for clinical prognosis • patient stratification/monitoring • bioprocessing 4.0 (digitalisation) • healthcare intelligence services • e-health solutions.

6. Ambitions to Control the Outcome

While the evaluation of all EIC Accelerator applicants is expected to be fair and prioritize the Excellence of the project, it is undeniable that there are policies in place that will fix the outcome. These are coming in the form of gender targets, societal impacts and related EU political agendas (read: EU Policies).

≥ Gender Outcomes: 40% all EIC Accelerator interviewee’s in Step 3 of the evaluation process must have female Chief Executive Officers (CEO) while 35% of all funded businesses must meet this criterion (read: Why it’s Great to Be a Woman). To facilitate this, special coaching will be given to female founders and the pool of evaluators, while 40% are already female, will be expanded to meet a 50% female share.

Considering that, without outcome-interventions by the EC, only <5% of beneficiaries had female CEO’s, this new target is an exceptional change but it is not clear how exactly the first two evaluation steps are affected by this Step 3 quota (read: The EIC Accelerator Performance Report).

≥ Sustainable Development: Amongst other targets, the EIC wants to support impact-oriented companies out of which 90% have to address sustainable development goals such as the Green Deal or similar targets. It is not clear how this focus will affect the EIC Accelerator.

≥ Geographic Diversity: A staggering change to the Step 3 pitch is that each EU member state and each associated country has to be represented in the interview stage with a number that is proportionate to the total number of applicants in earlier steps. This means that, for the first time, the EIC Accelerator is imposing geographic restrictions on its beneficiaries. This can be a double-edged sword since it has long been shown that some countries easily meet the 13-score funding threshold (i.e. 50% of applicants) while other countries have a more difficult time (i.e. 10%).

Countries that prioritize quantity over quality will be unfairly rewarded while countries that prioritize quality are being punished. It is still unclear at this point how strictly this rule will be enforced (read: Pre-Requisites for an EIC Accelerator Application).

7. Technical Changes

7.1 Coaching

3 days of coaching will be provided to all successful Step 1 applicants but at the costs of €1,000 per coaching day for the EC. The coaches will likely be external contractors and it is not clear how their experience could contribute to the preparation of the Step 2 application or to the practice of a successful Step 3 pitch.

7.2 Seal of Excellence (SOE)

SOE’S are awarded based on the Impact and Excellence criteria while the Implementation (i.e. risk-level and need for EU support) will be the determining factor to decide if the project is funded or if it is rejected (read: Evaluation Summary Report Analysis).

7.3 Applicants

Applicants can now, for the first time, be natural persons instead of only being Value Added Tax (VAT)-registered companies as long as an SME or Small-Mid Cap is formed prior to signing the EIC Accelerator contract. Of course, the natural person has to be a citizen of the EU or of an associated country (read: Associated Countries).

7.4 Equity

Next to direct equity investments by the EIC Fund in financing rounds initiated by the SME’s themselves (read: Inside Look into EIC Fund), convertible notes and other debt-related funding can be provided to beneficiaries. It is also finally clear that the obscure 30% co-financing of the EIC Accelerator grant can be financed through a parallel equity investment-request, thereby requiring no existing funding sources or revenues to fill the gap.

Direct equity applications without the request for grant support are now possible for applicants although the evaluation and proposal submission will differ.

Equity components can also be postponed by first opting for a grant application (i.e. grant-first) and later re-applying directly for equity-support.

7.5 The Pitch Video

This document will likely be submitted through a link since the cloud storage-needs and the requirement of government institutions to store files long-term would exceed existing capacities. One important repercussion of this decision is that, if startups can self-host their videos, enforcing a 3-minute restriction is extremely difficult since it is not possible to have an automated restriction as it exists for PDF page-limitations (read: Pitch Video Types).

The fairest way of implementing this would be to have direct file uploads to the EU platform and an automated time-trimmer to assure that all applicants only have 3 minutes to work with. If the EIC is using an AI-tool for the proposal development then introducing cloud video-hosting is only a minor challenge.

7.6 Timelines & Feedback

The Step 1 call will be open continuously and have no specified deadline. It will approximately take 4-6 weeks to receive feedback on the Step 1 5-pager whereas both successful and rejected applications will receive comments from the evaluators. For the Step 2 full application, the feedback is expected to be received 5-6 weeks from the cut-off date.

A 4-6 week feedback cycle for Step 1 does seem underwhelming since it is supposed to be a screening Step and not act as a full assessment. The estimated timing will potentially be different in practice and could be as fast as 2-3 weeks.

Face-to-face interviews will be 8-9 weeks after the Step 2 cut-offs (read: Deadlines) while 6 jury members will be responsible for the questions and assessments. EIC Fund associates can also join the pitch but they will not be in a position to ask questions or influence the evaluation result. The interview results will be ready within 2-3 weeks.

7.7 Reimbursement Advances

For short innovation life-cycles, SME’s can apply for a reimbursement advance that matches the grant condition but has to be paid back. With a 70% maximum contribution of €2.5M, the EU can provide financing that has to either be paid back (interest-free) or is converted into equity after a certain time period. The exact nature of the funding opportunity will be published soon but it will likely be at the discretion of the jury members who can directly assess the innovation life-cycle and time-to-market to make a recommendation.

7.8 Budget

Initial communications by the EC suggest that there were meant to be 3 cut-offs for Step 2 in 2021 but they then were reduced to two deadlines. The budget is already set and will be distributed across all topics. As of today, the total budget for 2021 is €1.109BN while the open calls have a €602M budget and the strategic calls share a €507M budget. Considering two parallel calls, namely the open call and the strategic challenges, this would give each cut-off an approximate budget of €554M which is significantly higher than even the COVID-relief and Green Deal cut-offs in 2020 (read: COVID and Green Deal 2020).

7.9 Inclusion of Small-Mid Caps

Historically, the SME Instrument and the EIC Accelerator have focused on SME’s, exclusively, but this will change under Horizon Europe. While SME’s are subject to specific size-restrictions that include the number of employees (max. 250), turnover (max. €50M) and balance sheets (max. €43M), Small Mid Caps can exceed these amounts. While restricted to only equity investments under the EIC Accelerator, companies can be 499-employees in size.

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.

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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:

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:

Burnrate, Runway and Cashflow for Startups (EIC Accelerator, SME Instrument)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) is seeking excellent and high-impact startups or Small- and Medium-Sized Enterprises (SME) which have reached a certain Technology Readiness Level (TRL – read: How the EIC Funds TRL’s). As part of the profile, such companies have usually received substantial seed investments or have been able to leverage income from either prototype sales or adjacent revenue streams. The European Commission (EC) and the European Innovation Council (EIC) are not necessarily looking for well-funded companies (i.e. non-bankability is still an important criterion – read: EIC Accelerator Buzzwords) but a company with zero-financing usually lacks sufficient product developments or the man-power to implement a disruptive innovation.

Burnrate, Runway and Cashflow

Startup companies are in a position where more funding is absolutely essential to reaching their goals and any disruptions in financing can be detrimental to the timing of the market entry and the competitiveness of the product. What such a startup has to manage extensively, as a first priority, is the monthly burnrate (i.e. how much is spent per month), the runway (i.e. how long will current funds last) and the cashflow (i.e. avoiding liquidity issues).

Consultants or professional writers are usually able to advise companies in these areas but it is essential for each company to be highly aware of these metrics themselves and to track them continuously.

The Risks of Bad Timing

The one factor that connects these three aspects is timing since the burnrate, runway and cashflow are all relative and depend on when financing items are due and what their source is. Bad timing can destroy an otherwise well-financed company in a matter of weeks if incoming financing is delayed but heavily relied upon. A term sheet can be pulled in the last minute, a grant can be cancelled, a customer can go bankrupt and key assets can be destroyed which makes timing and risk-management a priority.

Since such risks can come from a multitude of areas, every startup should always have the option to get lean which means they must be able to reduce their monthly costs to a minimum (i.e. hibernation) in a short time period. There is a simple reason for this: Nobody wants to onboard a sinking ship. If a company regularly has money problems then this can be a reason for investors to leave, due diligences to fail in sight of a potential insolvency or the management team to look for alternative occupations.

Limiting Costs as a Means of Survival

To balance operational risks, a startup has to ask themselves:

  • How many employees do I actually need to reach my development goals (i.e. quality over quantity)?
  • How tight is my financial planning with respect to incoming and outgoing payments?
  • How large is my buffer zone in case expected income is not received (i.e. doomsday runway)?
  • When can my company start using profits to bootstrap development costs independently?

There will always be a tradeoff between the risks and benefits of operating a startup on the razor’s edge but not every management team or CEO can succeed in such an environment. Outliers such as Elon Musk who put all of their net worth into their businesses and get dangerously close to bankruptcy if investments are not raised are rare and should not be emulated by most startups (i.e. Elon Musks raised last-minute SpaceX financing).

Conclusion

Having more than a dozen full-time employees for a pre-revenue startup is risky. Having only a 3-day buffer between reaching dept limits and a new investment round is risky. Scaling multiple pilot tests, in parallel, without revenues is risky. Each company has to understand the risks associated with the way cashflow is timed and needs to have an emergency (i.e. hibernation) strategy if funds run out.

High payrolls are impossible to shut down on short notice due to legal protections and a sense of employee-responsibility while a network of freelancers and contractors is much more dynamically adjustable. Property acquisitions or long-term leases can easily become a liability which can be compensated through short term rents with favourable cancellation conditions.

An old saying goes, “Prepare for the worst. The best will take care of itself.

Agile adjustments are the key to succeeding through tough times and poor risk management can put an early stop to an otherwise excellent business idea.

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:

Structuring an EIC Accelerator Pitch Deck for the Jury Interview (SME Instrument)

Under Horizon Europe (2021-2027), the EIC Accelerator blended financing program (formerly SME Instrument Phase 2, grant and equity financing) will reprise its use of pitch interviews after they have been successfully applied in previous years. In these interviews, startups and Small and Medium-Sized Enterprises (SME) are questioned in accordance to the evaluation process imposed by the European Innovation Council (EIC) and the European Agency for SME’s (EASME) during the in-person pitch week in Brussels (Belgium) or remote video calls (read: Pitch vs. Proposal).

Professional writers and consultants have been able to support a high number of successful applicants throughout the process but the official documentation by the European Commission (EC) has been scarce when it comes to the preparation of the pitch deck (read: Why Companies Fail & How to Prepare). While there was no in-depth guideline for the construction of a pitch deck or the questioning by the jury, there were some resources that could be used as a template.

One of these materials is a pitch deck template created by an external communication advisor of EASME in October 2017 that gives a general overview of how a pitch could be structured (link: EIC Pilot SME Instrument Pitch Deck Templates) but it is outdated. Like the pitch video (read: Structuring a Pitch Video), there are multiple creative ways to construct a pitch deck and the following article provides an overview of two different methods and approaches.

The EIC Template

The semi-official EIC Accelerator template for the pitch deck provides a very general list of slides with bullet points to explain the desired content. It is definitely a well-thought-out and comprehensive document but, as with all other templates, it can or cannot be ideal for a specific project. The individual guidelines for the slides are:

  1. Title Slide
  2. Company Purpose (i.e. mission, tagline)
  3. Problem & Solution (i.e. pain point, market need, fulfilling the need)
  4. Value Proposition (i.e. customer value, product benefits)
  5. Market Opportunity & Risks (i.e. market creating/transforming potential, target market size, risk mitigation)
  6. Competition (i.e. competitive analysis/advantages)
  7. Business Model (i.e. revenue streams, timing, costs)
  8. Commercialisation & Marketing Strategy (i.e. strategy, time to market, traction)
  9. Financial Projections (i.e. revenues, investments, financing needs)
  10. Team (i.e. management team, competence, track record)
  11. Conclusion (i.e. summary)

This template is very useful since it takes two of the most important aspects of the EIC Accelerator interviews into account: The 10-minute time restriction and a justification for support by the European Union (EU). On the flip side, it might be too overcrowded when it comes to the content per slide (i.e. market transformation, target market and risk analysis on a single slide) which could easily turn the deck into a text document.

In the end, a pitch deck has to inspire and convey a simple idea rather than to squeeze everything into a single document which can make the EIC template less suitable.

SlideBean Analysis

SlideBean, a company focusing on pitch presentations and resources for startups, has created a list of successful examples for pitch decks (find their articles here and here). This list includes companies such as Airbnb, Uber and Facebook and presents a valuable resource for the preparation of an EIC Accelerator pitch deck. Their recommendations based on the use of successful examples are the following:

  1. (Title Slide)
  2. Problem
  3. Solution
  4. Product
  5. Market Size
  6. Business Model
  7. Underlying Magic (i.e. why the technology works)
  8. Competition
  9. Differentiators
  10. Marketing
  11. Team
  12. Traction & Milestones

This version of a pitch deck, while having a similar length to the EIC template, clearly displays a leaner structure since aspects such as the company mission, risk mitigation or the market-creating potential are omitted. The SlideBean guideline exhibits a flow that aims to tell a captivating story rather than overwhelming the listeners with facts while specific justifications for the need of EU funds can be added to the last slide (or simply left for the questioning since this question will be posed anyways).

Conclusion

Even the greatest business will not succeed if the jury is bored or not captivated which means that the entertainment value (i.e. a good story-line, eloquent speakers and clear communication) comes first. The EIC pitch template can be misleading and potentially have companies overload their pitch decks with content while the SlideBean pitch deck is leaner and focused on storytelling.

For prospect EIC Accelerator applicants, it is useful to take the latter approach to pitch deck creation and follow the SlideBean template.

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:

Key Takeaways from the EIC Accelerator Deep Tech Report (SME Instrument Phase 2)

The European Innovation Council (EIC) has published The Deep Tech Europe Report: key numbers from the EIC performance (PDF) which summarizes key impact figures and statistics with respect to the EIC Accelerators performance. The EIC Accelerator blended financing program (formerly SME Instrument Phase 2, grant and equity financing) has been active since 2019 and relevant statistics on the equity investments are expected to guide the programmes reshaping throughout Horizon Europe (2021-2027).

The analysis found in this document is not only useful for prospect Small- and Medium-Sized Enterprises (SME) but also for professional writers and consultants who seek to improve their knowledge on the EIC Accelerator and the EU’s future ambitions in general. The detailed information given discusses topics that are valuable and are not generally part of the official work programme or the annotated proposal template such as the selected industries, business models, size of companies and their financing history.

The following is a summary of key takeaways and perspectives on the EIC Accelerator Deep Tech Report:

EIC Budget: Horizon Europe vs. Horizon 2020

The EIC pilot budget will increase from €3bn under Horizon 2020 (2018-2020 – 3 year period) to €10bn for Horizon Europe (2021-2027 – 7 year period). This means that the budget will increase from an average of €1bn a year to €1.42bn per year (a 42% increase).

Key Performance Indicators (KPI)

Funded projects were matched by private post-project investments with €3.3 (2015) to €2.9 (2016) for each €1 invested by the EIC in 2015 and 2016.

Female Participation

15% of the beneficiaries for blended finance calls (since June 2019) have had female CEO’s. During the Green Deal deadline in May 2020, this number rose to 34% through the dedicated efforts by the European Commission (EC) to increase the share of women funded by the EIC Accelerator (i.e. gender must now be selected on the Funding and Tenders (F&T) platform – read: Official Proposal Template Updates). Without the Green Deal cut-off, the rate of female CEO’s would have been at only 8% of all beneficiaries.

Valuation

5% of the former startups and Small- and Medium-Sized Enterprises (SME) in the EIC’s portfolio are currently valued above €100m.

Applications and Success Rates

With 9,700 applications in a single year, success rates have dropped to 2-3% on average whereas success rates of 1% and potentially lower have likewise been observed due to the coronavirus pandemic (COVID-19), the strongly advertised Green Deal call (read: The Green Deal) and the generally increased appeal of the grant to startups.

Out of all applications, 2,537 companies have received the Seal of Excellence (SOE) which means that these SME’s have received a score above 13 (read: The EIC Accelerator Score).

Evaluators and Jury Members

2,400 evaluation experts (i.e. for the written application in step 1) and 100 jury members (i.e. for the pitch week interview in step 2 – read: Pitch Deck) have been imperative to selecting the successful applications and assuring high-quality EIC Accelerator awards (read: EIC Accelerator Financing Timeline). The gender of the jury members has been well-balanced with the aim of having fairer results and gender equality whereas 51% of members were male and 49% were female.

While the step 1 evaluators are of varying backgrounds, the jury members have a strong investor-oriented background with 27% being innovation and industry specialists, 24% being venture capitalists, 22% being serial entrepreneurs and 19% being business angels.

Geographic Analysis

The top EIC Accelerator (SME Instrument Phase 2) companies by country have been Spain (930), Italy (701), the United Kingdom (UK – 459), Germany (377) and France (343) whereas associated countries such as Tunisia (0), Anguilla (2), Greenland (1), Armenia (1) and Gibraltar (0) were less represented.

Size of the SME’s

Judging by the numbers of employees, there has been a strong trend towards micro (1-9 employees) and small businesses (10-49) which are making up 97% of all applicants at equal shares whereas medium-sized businesses (50-249) only made up 3%. This is underlined by the share of medium-sized companies dropping gradually from 12% in 2014 to 3% in 2020.

Age of SME’s

When separating the funded EIC Accelerator companies into their founding dates, a trend towards preferring young SME’s has been observed whereas the share of over 10-year-old companies has dropped from 32% in 2014 to only 9% in 2020. In the same time frame, the youngest startups with an age below 5 years have grown from 47% to 63%. This underlines the interest of the European Union (EU) to encourage breakthrough innovation and reach short time-to-markets.

Selected Industries

From an industry perspective, the top-funded EIC Accelerator projects were representative of the Health (1,262), Energy (922), IT software (735), Transportation (424) and Food industries (396).

Target Customers

From a business model perspective, 77% of companies followed a Business-to-Business (B2B) approach while only 23% were targeting end-users through Business-to-Consumer (B2C) products.

Blended Financing (Grant with Equity Option)

For all awarded blended financing applicants in 2019 and 2020 (4 total cut-offs and 140 winners), the overall budget was €278m in grant financing and €583m in equity with €6.5m being the average financing amount.

EIC Accelerator Follow-Up Investments

EIC Accelerator-awarded companies have attracted a total of €5.3bn in follow-up funding through private investments or similar channels (i.e. equity, debt, Mergers & Acquisitions, Initial Public Offerings – IPO’s).

Equity investments made up a total of €4bn (74%) of the financing in subsequent Series A, growth equity or similar funding founds. Most of the investments were stemming from European sources (69%) whereas 22% were raised from the United States and 4% from Chinese investors.

Successful Exits of EIC Accelerator Companies

Initial Public Offerings (IPO) and acquisitions were the most common exits for EIC Accelerator-awarded companies with 17 and 43 in total, respectively, since 2015. Valuations of the top 10 companies were ranging from €200m to €700m with the annual growth being as high as 40%.

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:

Where can EIC Accelerator Results be found? (SME Instrument Phase 2)

The EIC Accelerator blended financing (formerly SME Instrument Phase 2, grant and equity financing) is an interesting opportunity for startups or Small- and Medium-Sized Enterprises (SME) to gain government funding for innovation activities. When working with a consultancy or professional grant writer, the process is simplified significantly but, when applying on their own, many startups are not entirely clear where results and awards are published.

The European Commission (EC), the European Innovation Council (EIC) and the European Agency for SME’s (EASME) have a variety of outlets where the names of awarded companies are published or how funded SME’s are notified. The core sources for such information are:

1. Email form the Funding and Tenders Portal

The best way to identify if your startup or SME has received the EIC Accelerator grant funding is to await the results sent through the Funding and Tenders Portal. If an account has been created and the submission has been completed, feedback by the European Union (EU) will proceed via a dedicated email to inform the applicant of the invitation to the EIC Accelerator interview week (i.e. in Brussels or via an online video call).

The email includes instructions regarding the upload of a pitch video (i.e. the pitch deck cannot be reviewed but supplemented with a short video), the registration of the speakers as well as the general timing of the pitch week.

2. Notification Area on the Funding and Tenders Portal

In case no email has been received, the EIC Accelerator applicants should check the Funding and Tenders Portal (F&TP) periodically where notifications are highlighted as badge counts. If the EC has important updates or news to communicate with the applicant, they will be found there.

There are a variety of notification zones inside the portal where messages can be exchanged, namely the main notification area on the F&TP, the document upload and communication area under “My Organizations” as well as the messaging section under the “Follow Up” section for an approved grant project.

In general, it is very difficult to miss any communication by the EC if emails are checked regularly and the F&TP is visited. If in doubt, the EIC’s twitter account can be visited to gain information on the timing of future communications (read: Finding EIC Accelerator News).

3. List of Beneficiaries on the EIC Accelerator Call Page

Another excellent source to identify the results of the EIC Accelerator is the regularly updated list of beneficiaries which gives the company name, website, acronym, project title and type of funding received (grant or blended financing with equity). The list can be found here and contains all EIC Accelerator-funded companies (incl. the SME Instrument Phase 2 beneficiaries).

Going back to January 2018 and spanning all of 2019 and 2020, the list further details the country of origin and city of residence for the applying entities. The document download page of the EIC Accelerator also includes occasional flash updates which give additional information on the calls total budget, funding success rate and the number of applicants (i.e. this example).

4. The CORDIS Database

Projects that have been selected for funding and have signed the Grant Agreement Contracts (GAC) will be published on the Community Research and Development Information Service (CORDIS) database. Here, the timing (i.e. project start and end), budget (i.e. grant and/or equity), name of the coordinator and the participating entities are listed.

In addition, the CORDIS page of an EIC Accelerator project will also contain the beneficiaries address, program information and the abstract of the project with detailed project reporting updates (read: The EIC Accelerator Abstract).

5. Publication on Social Media & Reports

Lastly, some information on EIC-funded companies can be found on social media sites such as Twitter (i.e. @EUEIC), Facebook (i.e. EIC), YouTube (i.e. European Commission or EU Science & Innovation) and Linkedin. When searching for the hashtag #EICAccelerator, companies often provide information on attempted or successful grant applications for past and current deadlines.

The EC likewise publishes regular reports on the performance of the EIC Accelerator (or SME Instrument) such as the recent The Deep Tech Europe Report: key numbers from the EIC performance and the previously published Innovation Kitchen: EIC Accelerator pilot in numbers.

These reports contain valuable statistics and key figures on the EIC Accelerator’s performance, information on the types of projects funded and the overall changes in budget, proposal template, gender contributions and industries.

Conclusion

Results regarding the successful applications for the EIC Accelerator can be found via:

  1. Email form the Funding and Tenders Portal
  2. Notification Area on the Funding and Tenders Portal
  3. List of Beneficiaries on the EIC Accelerator Call Page
  4. The CORDIS Database
  5. Publication on Social Media & Reports

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:

Visual Representation of an EIC Accelerator Proposal Narrative (SME Instrument Phase 2) – Part 3

Part 1 and Part 2 of this article can be found under the provided links.

The following article as a continuation of the visual guide (i.e. Part 3) for the preparation of an EIC Accelerator blended financing proposal (formerly SME Instrument Phase 2, grant and equity financing) which can be used by startups or Small- and Medium-Sized Enterprises (SME) as well as professional writers or consultants.

The EIC Accelerator is a highly competitive grant program offered by the European Commission (EC) and the European Innovation Council (EIC) for all eligible companies based in the European Union (EU) and associated countries (read: Pre-Requisites for an Application).

Technology (bottom half)

After the problem has been described at length and the gravity of its negative repercussions has been illustrated in great detail, the next step will be the presentation of the envisioned solution and how it solves the problem.

This Technology section does not strictly follow the annotated EIC Accelerator template but provides a more general approach as to how such a section could be structured. The official grant proposal template focuses on the business model while this visual guide follows a more abridged version of the overall narrative. It seeks to answer the question as to why the EIC Accelerator is needed as opposed to a private investor who could finance the project.

The EIC Accelerator prioritizes high-risk projects, EU policies, non-bankability and other criteria which are not exactly investor-friendly or -relevant (i.e. gender equality). As a result, this guide targets EU-specific narratives and does not go into detail with respect to other essential proposal sections. A professional grant writer should be aware that the following explanation is omitting key sections in order to present a clear perspective on how a company can argue for the EIC’s support.

While the previous narrative was focusing on introducing the missing link (i.e. Part 2), this technology part should be viewed as the enabler which is essential in solving the problem and becoming the missing link.

1. Solution

The first step, after having clearly explained the missing link, is to present the innovative technology that has been successfully developed. It should be clear that the Unique Selling Points (USP) of this technology are directly addressing the missing link and that these are not covered by other market alternatives (thus “unique”).

A submitted application will be much more successful if the key user needs are actually addressed only by the innovation which means that the product or service is a must-have and not a nice-to-have.

The transition from “5. Missing link” to “6. Solution” has to be seamless and it must be clear that the innovation itself is needed in order to fix the problem (read: The Missing Link). If the technological developments are not directly addressing the issue then the developments will not be viewed as essential and the evaluation score of the grant proposal will be low.

2. Non-Bankable

Once again, this section deviates from the grant proposal template but the content and reasoning can be applied to certain key sections in the application.

Non-bankability is a key factor for the EIC Accelerator and is the complete antithesis of what an investor usually looks for. An investor wants to invest in great companies before other investors have discovered them while the European Commission (EC) specifically wants to invest in great companies that cannot leverage further funding from any other sources.

As such, the argumentation for non-bankability has to be conducted carefully by still highlighting the competence of the team (incl. financial competence) but also highlighting the need for financing and an inability to obtain it (read: EIC Accelerator Buzzwords). The innovation project should be described as “high-risk” and it should be explained why financing cannot be obtained elsewhere (i.e. further de-risking is needed incl. validation at scale).

3. EIC Accelerator

After the critical need for financing of the innovation-project has been elaborated on, the EIC Accelerator has to be presented as the perfect solution to providing such financing. It should be clear that, in order to solve the EU problem, the EIC Accelerator is needed and acts as a springboard to reach the desired commercialisation.

Here, the necessity of the work packages, the implementation and the desired outcome can be highlighted since it will directly reflect the impact of the grant. The EIC Accelerator must be a key step in realising the project and be presented as a must-have in the following development steps (read: TRL Stages). While “7. Non-Bankable” detailed why the grant is needed, this section describes how it is used.

4. Traction

The final parts of the technology side for the EIC Accelerator grant application will address the post-project environment and how the commercialisation will proceed. The traction can be highlighted in this section which includes the pilot customers, validations and Letters of Intent (LOI) (read:  Assessing Traction).

The main takeaway should be an impressive level of traction and interest from related stakeholders which turns the perception of a new and unproven technology into a real-life and strongly desired commercial product.

The commercialisation strategy, partners, value-chain and related factors have to be described convincingly and establish a sense of realism and opportunity.

5. Scaling

Scaling is an important term for the EU since the EIC Accelerator is specifically looking for projects that have the capacity to reach a global scale and become future EU unicorn startups. As such, it should be explained in great detail why such a scale is possible and achievable.

Financials, company growth and the overall future vision should be highlighted here and details on the impact on the environment, industry and the EU should be quantified.

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: