Tag Archives: EIC Accelerator pilot

The EIC Accelerator funding (grant and equity, with blended financing option) by the European Innovation Council (EIC) and European Commission (EC) has a clear focus on high-risk startups with high commercial potential. It is ideal for startups and Small- and Medium-Sized Enterprises (SME) since the funding per project can reach €17.5 million in total (€2.5 million in grant and €15 million in equity) and is ideal to finance scale-up activities.

The EIC Accelerator grant proposal template is very detailed and specific with multiple questions aiming to gauge the level of innovation and disruptiveness of the presented technology. Due to the complexity of these grant proposal templates, startups often rely on freelancers, professional writers or consultants to support the development of the documents.

This article provides a simple guide for prospective applicants regarding the development of Unique Selling Points (USP).

Developing Unique Selling Points (USP)

One of the EIC Accelerator proposal sections is dedicated to the USP’s of the company’s product or service which is an essential part of identifying the commercial impact of the technology.

Startups often struggle with such definitions since many EIC Accelerator applicants are in the early stages (i.e. Technology Readiness Level 5/6 – see TRL) with many companies being pre-revenue and pre-product-launch.

Starting With the Innovation

The USP’s are often at the intersection between the innovativeness of the company’s technology, the business model and the market’s current offerings.

Begin by listing 1-5 unique technological features that you view as the core innovation of your product or service. These are technical mechanisms of your hardware, software features or any other unique aspect of what your technology is capable of while current market alternatives fail to offer them.

It is recommended to try and focus only on the most innovative aspects of the technology and to keep them clear and to the point rather than trying to inflate them through using as many small features as possible.

The following questions will help to focus on the most innovative features since the less innovative components will likely fail to produce suitable answers. For each of the listed technological features, answer the questions below so that each feature is going through all questions in succession:

Question	Innovation 1	Innovation 2	Innovation 3
Why does your technology have this feature but not others?
Is it hard to copy?
Is it patentable?
How do you quantify the benefit per unit? (i.e. 50% less time-spent or €50K lower costs per device)
What does this benefit mean for your customer? (i.e. €250K saved p.a. and 100 MWh of additional capacity)

1. Why does your technology have this feature but not others?

Explain why you were able to achieve this technology milestone or develop this feature and why other companies or institutions have failed. This question is aiming to identify why it is new and why this product or service does not exist on the market.

If the answer is a technical innovation, a high level of complexity or any other undeniable head-start then this question will have a positive answer. If the answer is vague as in “no other company has tried this yet” or “other companies could create it but do not view it as valuable” then this is not a promising innovation.

2. Is it hard to copy?

This is a core question that any evaluator or jury member will be interested in. If we invest in you, will you be able to guard your Intellectual property (IP) and capitalize on it?

For this question, it is useful to identify under which conditions competitors could copy your solution and what their limitations are. How many years would it take? Are there IP barriers? How much financing would a competitor need to copy you?

3. Is it patentable?

For any DeepTech company with long development times, IP is a very important factor. Can this particular feature be IP protected, globally? If not, how can you assure that the IP remains in-house and does not leak out?

Software is often more difficult to patent than hardware in the European Union (EU) but it is important to have a clear IP protection strategy regardless since this is a core technology feature that the entire business model will stand on.

4. How do you quantify the benefit per unit? (i.e. 50% less time-spent or €50K lower costs per device)

Quantifications are the flavor of every EIC Accelerator application and any investor presentation. Without it, all a company is presenting is a story. Quantifying the business model, the technology benefit, the customer interest and the product-market fit are essential.

For this question, answer what exactly the benefits are over conventional alternatives for each feature. Compared to what exists on the market, how is your feature better? How can you quantify this benefit? Does this benefit also apply to direct competitors with similar technologies?

5. What does this benefit mean for your customer? (i.e. €250K saved p.a. and 100 MWh of additional capacity)

This is a key question that can often be neglected. Just because your feature can reduce the time spent on a certain production task or the costs of a device does not explain what this means for your customer. Maybe the time reduction is irrelevant since the time savings of 50% only add up to 5 seconds since the production step is simple. Maybe you save your customer 5 months with this feature.

Quantify the benefit by using a pilot customer or imaginary customer as an example. If they implement your product, they can reduce the production time by 50% which means that a 20-hour production process now only takes 10 hours. For that particular customer, €500K are saved annually if they produce 1,000 devices a year.

Not every benefit has to be financial but it is still advisable to create a financial assessment regardless. Emission savings can be expressed financially due to carbon taxes. Improved workflows can likewise be expressed financially since they will impact productivity.

Conclusion

This simple list allows you to identify the USP’s of a multi-faceted project and should yield a table where every feature has answered every question.

For less unique features, the questions will be difficult to answer and these should not be counted as unique selling points for the EIC Accelerator. It is also possible that a single feature (i.e. the automation of a certain task) can lead to multiple USP’s.

This article can act as a good starting point to clarify and brainstorm on the unique components of a product or service.

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) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

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, Horizon Europe, SME Instrument / EIC Accelerator

The New EIC Ecosystem, Fast-Track and Pilot Plug-In Schemes (2023 EIC Accelerator Work Programme Part 8)

November 5, 2022 stephanseglerphd

The EIC Accelerator funding (grant and equity, with blended financing option) awards up to €2.5 million in grant and €15 million in equity financing per project (€17.5 million total). It is a popular funding instrument specializing in DeepTech startups and small mid-caps which aim to finalize their product developments, enter the market and scale globally.

The EIC’s 2023 Work programme

While the European Innovation Council (EIC) has remained silent regarding the 2023 Work programme that is yet to be released, ScienceBusiness has published the second draft of the highly anticipated document dated July 2022. This article series is exploring some changes and interesting aspects of the EIC Accelerator that are relevant for startups and Small- and Medium-Sized Enterprises (SME) and for professional writers, freelancers or consultants.

ScienceBusiness has likewise published the entire library of Horizon Europe documents by the European Commission (EC) that are mostly in draft form and can be found here.

All the information and conclusions provided in this article are subject to change and the opinion of the author. The following statement by the EIC is part of the 2023 EIC Work Programme draft that this article is based on:

“This document represents a working draft of the EIC work programme for the purpose of feedback and comments from members of the Horizon Europe Programme Committee for the EIC and European Innovation Ecosystems. This draft has not been adopted or endorsed by the European Commission. Any views expressed are the views of the Commission services and may not in any circumstances be regarded as stating an official position of the Commission. The information transmitted is intended only for the Member State or entity to which it is addressed for discussions and may contain confidential and/or privileged material.”

The EIC Ecosystem

In 2021, it was leaked that the EIC is aiming to create an ecosystem not only for DeepTech companies but also for investors, consultancies, coaches and other relevant stakeholders.

“The idea of the platform is to allow […] any applicant at a given moment where he needs […] support from someone […] access to an ecosystem platform […] where he will find different actors but also those private companies, consultants who want to partake into the exercise to be referenced in this in the system and to offer their service. Now, they will have to pay something, a fee to be referenced.”

– Nicolas Sabatier (General Counsel & Adviser to the EIC/EISMAE) via AI Tool EIC Training for NCPs 11^th12^th March 2021, quoted at 1:52:09

While the vision of a subscription-based service might still be far in the future, its first iteration is on the way.

“From 2023, the EIC BAS services will be expanded through EIC Ecosystem Partners which can include, for example, investors, business angels, mentors and coaches, innovation agencies, business associations, clusters, accelerators, incubators, technology transfer offices, venture builders, etc. EIC BAS services provided by Ecosystem Partners includes access to existing incubation and acceleration programmes as well as services specifically designed in collaboration with EIC.”

Especially the search for co-investors is an exciting prospect for applicants since it can help them gain access to EIC Financing without being forced to find private lead investors by themselves.

“The EIC will also continue to directly manage a core set of business acceleration services which provide a clear added value, which include: A platform for EIC Accelerator companies in receipt of equity investment to find co-investors”

Fast Track and Pilot Plug-in Schemes

The EIC’s 2023 Work Programme continues to offer fast-track and plug-in schemes whereas a company funded under specific EU grant or equity financing projects can cross-migrate into the EIC Accelerator application process without having to start from scratch.

“Full proposals to the EIC Accelerator stemming from the Fast Track scheme will be assessed as set out in Section IV, and will be treated in exactly the same way as all other full proposals.“

“In 2023, the funding bodies and schemes which are eligible for the Fast Track for EIC Accelerator cut-off dates are:

The EIC Pathfinder and EIC Transition projects (including under EIC pilot);

The Knowledge and Innovation Communities (KICs) supported by the European Institute of Innovation and Technology (EIT);

The Eureka secretariat for SMEs supported under the Eurostars-2 Joint Programme and the Partnership on Innovative SMEs;

Companies supported by the WomenTech.EU programme.”

“Under the Plug-in scheme, applicants do not apply directly to the EIC Accelerator call (Section IV). Instead, a project review is carried out by the certified national or regional programme to assess the innovation or market deployment potential of an existing project supported by the programme, and to decide whether the project is suitable for support under the EIC Accelerator.”

Both mechanisms seem beneficial to applicants on the surface but they are, unfortunately, of limited use. Fast track and plug-in schemes only allow applicants to skip the first of the three evaluation steps (i.e. the Step 1 short application) but this is also the easiest step in the entire process.

If a company can skip Step 1 which consists of a pitch deck, a video and a written proposal then this also means that there is no video for the project that the Step 2 evaluators and the Step 3 jury can look at which can be a disadvantage (read: EIC Accelerator Pitch Video).

Of course, a company can decide to upload a Step 1 video retroactively even if they have been allowed to skip this step which is highly recommended.

“Applicants will then be invited to prepare a full proposal for the EIC Accelerator to one of the cut-off dates within the next 12 months following initial review. […] Full proposals to the EIC Accelerator stemming from the Plug-in scheme will be assessed as set out in Section IV (above) and will be treated exactly the same way as all other full proposals.”

Note: The term “full proposal” refers to the Step 2 application consisting of a detailed business plan.

What further questions the usefulness of the fast track and plug-in programs is the fact that the Step 2 application re-uses a substantial amount of the text from the Step 1 application. In fact, one can use 100% of the text written in Step 1 for the Step 2 application which means that, even if a company skips Step 1, they still have to fill all of these Step 2 sections from scratch.

Considering the limited effort required for the preparation of a Step 1 proposal, their high success rates and the fact that the text, video and pitch deck would need to be prepared for Step 2 anyways, the fast track and plug-in schemes are of little practical benefit. An exception would be a case where a company has significant time restrictions and must unlock the Step 2 EIC Accelerator template in the online platform as soon as possible to meet the next cut-off.

Outlook

A truly useful fast track or plug-in scheme would allow a direct application to the Step 3 interviews especially if the plug-in scheme has already performed additional due diligence on the project specifically for the EIC Accelerator. Step 2 is the most difficult step of the EIC Accelerator program but it is understandable that the EIC aims to retain the integrity of the full application process since it could otherwise compromise the quality of projects reaching the Step 3 interviews.

This article is part of a series whereas the remaining articles can be found here, once published:

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

Contact: You can reach out to us via this contact form to work with a professional consultant.

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, Horizon Europe, SME Instrument / EIC Accelerator

The EIC’s 2023 Strategic Challenges and Topics (2023 EIC Accelerator Work Programme Part 7)

November 5, 2022 stephanseglerphd

The EIC’s 2023 Work programme

ScienceBusiness has likewise published the entire library of Horizon Europe documents by the European Commission (EC) that are mostly in draft form and can be found here.

“This document represents a working draft of the EIC work programme for the purpose of feedback and comments from members of the Horizon Europe Programme Committee for the EIC and European Innovation Ecosystems. This draft has not been adopted or endorsed by the European Commission. Any views expressed are the views of the Commission services and may not in any circumstances be regarded as stating an official position of the Commission. The information transmitted is intended only for the Member State or entity to which it is addressed for discussions and may contain confidential and/or privileged material.”

The EIC Accelerator Open and Strategic Challenges

The 2023 Work Programme of the EIC is outlining the newest Strategic Challenges for the EIC Accelerator. These are renewed every year alongside the new Work Programme implementation and have separate allocated budgets. It is common that the EIC Accelerator Open and the EIC Accelerator Challenges have a comparable budget while the chances of success could be higher in the thematic challenges due to the strict topic limitations.

This is due to the smaller number of applicants compared to the EIC Accelerator Open which has no thematic restrictions but this might be irrelevant since the EIC has announced that the Strategic Challenges budget will be transferred to the EIC Accelerator Open if there are not enough applicants available. Of course, the applicants for the Strategic Challenges still retain first priority for their respective budgets.

“However, if there is insufficient applications selected for funding for a Challenge, the budget will be transferred to the other Challenges. In case there is insufficient applications selected for all the Challenges, the remaining budget will be transferred to the Accelerator Open.”

As given in the EIC’s draft Work Programme 2023, the seven new EIC Accelerator Challenges are:

Challenge 1: Novel biomarker-based assays to guide personalised cancer treatment

Specific objectives

“The overall goal of this Challenge is to support and accelerate the preclinical validation and/or clinical phase 1 work carried out by innovative SMEs (including start-ups, spinouts) and small midcaps to develop novel predictive, prognostic and companion diagnostic assays to guide cancer treatment. This Challenge has the following specific objectives:

develop novel companion diagnostic assays , including through liquid profiling; to identify who, among cancer patients, is more likely to benefit from a given treatment (guided treatment);develop novel predictive biomarker-based assays to identify who, among patients with potentially precancerous lesions, is more likely to develop cancer;

develop novel prognostic assays including through liquid profiling to identify who, among the cancer patients who underwent treatment, is more likely to recur;

develop novel companion diagnostic assays, including through liquid profiling to identify who, among the cancer patients receiving treatment, is more likely to develop side effects as a result of the treatment and

to develop novel monitoring biomarker-based assays to effectively monitor the clinical course of the disease.”

Expected outcomes and impacts

“As expected outcomes from this Challenge, clinicians will be able to:

Identify, who among cancer patients, is more likely to benefit from a given treatment (guided treatment)

Identify, who among patients with potentially precancerous lesions, is more likely to develop cancer

Identify, who among the cancer patients having underwent treatment, is more likely to recur

Identify who among the cancer patients receiving treatment, is more likely to develop side effects as a result of the treatment, affecting their quality of life and

More effectively monitor the clinical course of the disease”

Challenge 2: Aerosol and surface decontamination for pandemic management

Specific objectives

“The proposals should target the development and commercialisation of technological solutions facilitating social interaction in the context of pandemic emergencies, by means of one or more of the three following approaches:

Full systems for high-efficiency aerosol capture, pathogen deactivation and air circulation management in closed-environments (e.g., office space, in-flight, retail stores, etc.), including advanced air-filtering architectures and dynamic air circulation optimisation.

Next-generation face mask technologies with smart filtration materials to exceed N95 performance at low airflow resistance, with improved retention/rejection of sub-micron particles.

Rapid surface decontamination devices beyond state-of-the-art UV-C irradiation systems and biocidal agent dispersion.

Where advantageous, pathogen profiling sensors and sub-systems could be integrated with air renewal systems, face masks or surface decontamination devices to provide quasi- real-time information on pathogen presence for rapid decision making and/or autonomous optimisation of air circulation.

The proposals should provide preliminary evidence demonstrating that social distancing can be avoided or substantially reduced, under realistic pathogen infectivity assumptions, with the targeted technologies.”

Expected outcomes and impacts

“By reducing the need for social distancing in the event of infectious pandemics, this Challenge will empower society at large to sustain unaltered economic and social dynamics in the event of pandemic outbreaks.”

Challenge 3: Energy storage

Specific objectives

“This Challenge targets groundbreaking innovations in any field of technology that have a high potential to meet the following goals:

to store electric and/or thermal energy at low cost, high density, high charging/discharging efficiency and enhanced durability.

technological approaches (chemical, electrical, electrochemical, mechanical, thermal) for energy storage at different scales (centralized at large industrial facilities premises or distributed and at small scale level – mobile electronics), duration (short – millisecond to day, medium – days to month and long term – months to seasons) and uses (from stationary to mobile).

technologies that, without using critical raw materials or ensuring their full recycle/reuse, minimize their carbon footprint measured through a life-cycle analysis (including cost and social impact evaluation). The proposed technologies could also address the smart operation and control of storage assets, their integration with demand response strategies, predictive maintenance, load forecasting and decentralized renewable energy technologies.”

Expected outcomes and impacts

“The possibility to store electrical or thermal energy at low cost, high density, high charging/discharging efficiency and for different duration (from short to long) will:

enable a strong penetration of intermittent renewable energy resources by addressing the spatial and temporal mismatches between generation and demand,

set up decarbonized, interconnected, sector-coupled and flexible energy systems.

Increase Europe’s energy independence from unreliable suppliers”

Challenge 4: New European Bauhaus: Digitisation for sustainable and inclusive built environment

Specific Objectives

“The call aims to enable a paradigm by supporting deep tech ventures that can deliver disruptive new products and services for a digitised value chain with a focus on:

Computational design. ventures that develop and scale radical new products for mass-adoption of parametric, generative and algorithmic design, pushing the boundaries of physical simulation, digital twin;

Alternative materials. ventures active in the development, production, advanced application of alternative building materials, or building concepts, building elements, design+fabrication concepts (e/g stereotomy 2.0) based on advanced uses of alternative materials.

Digital fabrication. ventures developing and commercializing scalable 3Dprinting, robot assisted composites, factory and field robotics, automation products, digital molds, distributed building factories.”

Expected Outcomes and Impacts

“The overarching objective of this Challenge is to provide transformative digitally enabled solutions for the construction sector that can help it achieve climate neutrality while providing inclusive and high quality products.

The focus will be on achieving a reduction in embodied rather than operational carbon emissions. Socio-economic impacts include higher productivity, higher product quality, reduced material consumption and waste, improved construction logistic in the urban environment and increased economic impact without compromising on quality or safety.

This approach will also lead to higher quality jobs in a more progressive and appealing sector that can deliver a step-change in the overall quality of the social experience with the built environment.”

Challenge 5: Quantum computers hardware and real environment quantum sensors

Specific objectives

“The objective of this Challenge is to support ground-breaking innovations that have a high potential to develop:

Next-generation fault-tolerant quantum computer(s) with:
1. improved performance;
2. significantly simplified QC integration with control electronics;
3. scalable control systems (scalable to tens of thousands of qubits, needed for meaningful practical applications);
Quantum sensors to function in real/harsh environment for various application areas, such as ecotoxicology, pharmaceuticals, biomedical, space, corrosion detection in power plants, gas/oil tanks, raw material detection, medical imaging, automotive and many more.”

Expected outcomes and impacts

“This Challenge is expected to support EU in taking a leading role in the development of cutting edge quantum computing and quantum sensors that can be used in real environment and deployed in various areas such as medical devices, pharmaceuticals, materials science, defence, space, etc.

In mid and long term, this challenge is expected to expand the quantum capabilities of Europe, underpin its economic resilience and digital sovereignty. It should pave the way for Europe to be at the cutting edge of quantum capabilities by 2030 as envisioned by the 2030 Digital Compass: the European way for the Digital Decade.”

Specific conditions

“Applications to this EIC Accelerator Challenge may request an investment component of above EUR 15 million in duly justified cases.”

Challenge 6: Sustainable and resilient agriculture

Specific objectives

“Design, development and evaluation of interdisciplinary solutions for regenerative agriculture and soil health in the areas of
1. Fertilisation
2. Crop protection
3. Irrigation
4. Tillage
5. Soil and crop management
Radical innovations in precision fermentation for the food sector, including but not limited to mycoproteins.
Radical innovations in the area of natural solutions for carbon management and valorisation (carbon farmingcarbon stock in the soil, etc)
Novel processes, materials, equipment, crops and microorganisms adapted to harsh environments, climate adaptation needs and resource scarcity.”

Expected outcomes and impacts

“This Challenge aims to improve the resilience and security of the European food supply chain, notably by maintaining and improving crop yield with environmentally friendly technologies, all while regenerating and increasing soil health. By aiming to valorise crop residues, this Challenge also aims to contribute to better carbon and nitrogen management practices, to mitigate climate change.

In doing so, the results arising from this challenge will foster the EU technological autonomy and leadership via focused support of innovations in the areas of sustainable and resilient agricultural production, food security, biodiversity and environmental protection. The challenge also aims to reduce the EU dependency from critical supply chains and strengthen the EU innovation ecosystem competitiveness in the strategic sectors of ecologic transition and clean, secure and cheap energy provision.”

Challenge 7: Customer driven, innovative space technologies and services

Specific objectives

“The overall goal of this challenge is to ensure Europe is able to service and protect its own Space infrastructure, avoiding the risk of losing its strategic autonomy over its own space assets, while enhancing the competitiveness of its space industry through encouraging the emergence of innovative, interoperable, scalable, and autonomous “customer-driven” innovative space technologies.

In terms of technological developments, the specific objectives of the call are:

To have the means to inspect spacecraft in orbit, to augment satellite capabilities and resilience;
To develop autonomous and in-space collision avoidance capabilities e.g., use of AL/ML for collision avoidance manoeuvres, space debris positioning data and develop in-space mobility propulsion capabilities;
To further mature self-assembly of spacecraft in orbit with different applications (e.g., in-orbit, cis-lunar exploration, Earth observation, space debris inspection, space situational awareness, etc.);
To collect and recycle space debris or recovering intact components from nonoperational satellites or cut dysfunctional satellites turning them into metal rods for potential fuel;
To refurbish upper stage of launchers and transform them into microgravity platforms;
To design and construct a R&I low Earth orbit unmanned modular platform assembled in orbit and to host in-orbit microgravity experiments or collect/reuse space debris;
To develop innovative technologies for Earth observation, navigation, satellite communications (SATCOM), space science, space situational awareness (SSA) and in-space logistics needing in-orbit demonstration and in-orbit validation (IOD/IOV).”

Expected outcomes and impacts

“This Challenge aims at developing:

an EU servicing and re-use/recycling capability for servicing EU space infrastructure, while contributing to the management and reduction of space debris;
timely and cost-effective Space Traffic Management services for on-time collision avoidance manoeuvres;
the re-use, refurbish or recycling of a spacecraft components or launchers upper stages scientific and technological solutions for in-orbit services and reuse/ refurbishing and recycling of old spacecraft (e.g. satellites, rockets upper stages, etc.);
Innovative propulsion solutions for in-space mobility of spacecraft”

Specific conditions

“Where relevant, companies supported under this Challenge will have access to in-orbit demonstration and testing facilities financed under Horizon Europe.”

This article is part of a series whereas the remaining articles can be found here, once published:

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

Contact: You can reach out to us via this contact form to work with a professional consultant.

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, Horizon Europe, SME Instrument / EIC Accelerator

The Grant Proposal Evaluation Criteria (2023 EIC Accelerator Work Programme Part 6)

November 5, 2022 stephanseglerphd

The EIC’s 2023 Work programme

ScienceBusiness has likewise published the entire library of Horizon Europe documents by the European Commission (EC) that are mostly in draft form and can be found here.

“This document represents a working draft of the EIC work programme for the purpose of feedback and comments from members of the Horizon Europe Programme Committee for the EIC and European Innovation Ecosystems. This draft has not been adopted or endorsed by the European Commission. Any views expressed are the views of the Commission services and may not in any circumstances be regarded as stating an official position of the Commission. The information transmitted is intended only for the Member State or entity to which it is addressed for discussions and may contain confidential and/or privileged material.”

Evaluation Criteria for the Short Application (Step 1)

The evaluation criteria for the EIC Accelerators short application have remained largely consistent whereas the 2023 EIC Work Programme outlines the following scoring criteria for Step 1 applications.

1. Excellence

Breakthrough and market creating nature: Does the innovation have a high degree of novelty – compared to existing products, services and business models – with the potential to create or significantly transform markets?
Timing: Is the timing right for this innovation in terms of market, user, societal or scientific of technological trends and developments?

2. Impact

Scale up potential: Does the innovation have scale up potential, including the potential to develop new markets and impact on the growth of the company? Does the company show a clear and convincing vision, taking into account its current level of development and maturity, in relation to the targeted market, the business model and growth forecasts?
Broader impact: Will the innovation, if successfully commercialized achieve positive broader societal, economic, environmental or climate impacts?

3. Level of risk, implementation, and need for Union support

Team: Does the team have the capability and motivation to implement the innovation proposal and bring it to the market? Is there a plan to acquire any critical competencies which are currently missing, including adequate representation of women and men?

Complaints and Rebuttals for Step 1 Rejectees

In 2021, the EIC has made a significant step towards transparency by allowing all EIC Accelerator applicants to view comments from the evaluators who have reviewed their proposals. While this is of tremendous benefit to applicants, it has likewise exposed a certain degree of randomness in the way applications are graded including mistakes, negligence or plain ignorance.

This is, of course, to be expected and only natural when facing thousands of applications and multiple reviewers per proposal. Still, this has inevitably led to complaints regarding specific Evaluation Summary Reports (ESR) and especially the remote evaluators.

While the EIC has tried to investigate such complaints in the past, the vast majority of applicants were simply told to re-apply to the next cut-off and summarize their rebuttal in the resubmission of their proposal (i.e. via the email of the European Innovation Council and SME’s Executive Agency: support@eic.eismea.eu).

The new 2023 Work Programme is outlining the conditions for issuing a formal complaint as opposed to relying on the resubmission of rejected Step 1 proposals.

“You may file a complaint if you believe that the evaluator(s) made an incorrect assessment on the following grounds:

a factual mistake;

absence of information which is not required at short proposal stage; and

a manifest error of appreciation on the scope and purpose of the Accelerator.”

Unfortunately, this has only limited use since the EIC Accelerator’s Step 1 is by far the easiest step. If the same rule was applied to Step 2 full applications then the EIC would likely find themselves with a valid complaint for the majority of rejected applicants since it is common to encounter at least one factual mistake in any given Evaluation Summary Report (i.e. misreading Letters of Intent, Freedom to Operate analyses or missing critical information).

In case a rejected Step 1 application is retroactively given a GO grading (i.e. passing the step successfully) then they are able to apply to Step 2 at the original deadline that was reachable in their previous submission.

“If your proposal is reevaluated as a GO, you will be eligible to introduce your full application to the same cutoff date that you would have been able to submit to, with a GO from the initial evaluation.”

This second quote from the EIC’s 2023 Work Programme draft is obscure but this can be understood as the EIC allowing Step 2 applicants to hand in applications past the deadline in case a complaint was approved. But this seems unrealistic due to time constraints in the preparation of Step 2 applications and the limited time window of the evaluation prior to the fixed interview deadlines.

Evaluation Criteria for the Full Application (Step 2)

For the EIC Accelerator’s Step 2, the evaluation criteria are defined as follows

1. Excellence

Breakthrough and market creating nature: Does the innovation have a high degree of novelty, compared to existing products, services and business models, with the potential to create or significantly transform markets?
Additional sub-criterion for EIC Accelerator Challenges ONLY: How relevant are the proposal objectives in contributing to the specific objectives of the Challenge?
Timing: Is the timing right for this innovation in terms of market, user, societal or scientific of technological trends and developments?
Technological feasibility: Is the innovation based on a technology or technologies that have been adequately assessed at least in a laboratory environment and relevant environments to characterise the potential and assess the level of risk (at least TRL 5/6)? Is the technology developed in a safe, secure and reliable manner?
Intellectual Property: Does your company have the necessary Intellectual Property Rights to ensure freedom to operate and adequate protection of the idea?

2. Impact

Scale up potential: Does the innovation have scale up potential, including the potential to develop new markets and impact on the growth of the company? Are the associated financial needs well assessed and realistic?
Broader impact: Will the innovation, if successfully commercialised achieve positive broader societal, economic, environmental or climate impacts?
Additional sub-criterion for EIC Accelerator Challenges ONLY: Does the proposed application have the potential to contribute to the expected outcomes and impacts set out in the Challenge?
Market fit and competitor analysis: Has the potential market for the innovation been adequately assessed, including conditions and growth rates? Has a competitive analysis been thoroughly performed, including identification of potential customers and relevant types of users, including women and men, definition of unique selling points and key differentiation from competitors?
Commercialisation strategy: Is there a convincing and well thought-through strategy for commercialisation, including regulatory approvals/compliance needed, time to market/deployment, and business and revenue model?
Key partners: Have the key partners required to develop and commercialize the innovation been identified and engaged, including their roles/competences and a sufficient level of commitment and incentivisation?

3. Level of risk, implementation, and need for Union support

Team: Does the team have the capability and motivation to implement the innovation proposal and bring it to the market? Is there a plan to acquire any critical competencies which are currently missing, including adequate representation of women and men?
Milestones: Is there a clear implementation plan with defined milestones, work packages and deliverables, together with realistic resources and timings?
Risk level of the investment: Does the nature and level of risk of the investment in your innovation mean that European market actors are unwilling to commit the full amount alone? Is there evidence that market actors would be willing to invest, either alongside the EIC or at a later stage?
Note: Small mid-caps will be expected to provide documentary evidence that their bank has refused the financing needed for the project.
Risk mitigation: Have the main risks (e.g. technological, market, financial, regulatory) been identified, together with measures to take to mitigate them?

Step 3 Interview Criteria

For the Step 3 interviews, the same vague criteria used in the previous iterations of the EIC Accelerator apply (read: How to Prepare for the Interview). An interesting feature of the Step 3 interviews is that the EIC Jury can consult external analysts who will assess the project prior to the interview.

“Jury members will also have access to analyses (for example on financial metrics) generated by the EIC AI-based platform and in certain cases the independent assessment of a specialised expert in the field of science or technology. Such analyses will be made available to applicants after the decision.”

This might provide only limited usefulness since it would be more beneficial to make the scientific and technical aspects a fundamental part of the Step 3 selection rather than an optional add-on.

Otherwise, a groundbreaking battery startup without revenues or customer commitments could consistently lose against a software company with excellent financial health and competitive advantages but only limited technological or scientific breakthroughs. In the same way, a scientific team with only 2 or 3 employees will have a difficult time convincing the EIC Jury while a technical Jury member might be impressed by the technology and achievements while being more optimistic.

Through the outsourcing of the EIC Fund’s management to the European Investment Bank (EIB) and Alter Domus (Luxembourg), the EIC could become more risk-averse and, while it claims to fund DeepTech at TRL5, it might end up only picking projects that are already in the market or have significant customer commitments.

This article is part of a series whereas the remaining articles can be found here, once published:

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

Contact: You can reach out to us via this contact form to work with a professional consultant.

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, Horizon Europe, SME Instrument / EIC Accelerator

Cancelling Funding and Changing Grant Requests (2023 EIC Accelerator Work Programme Part 5)

November 5, 2022 stephanseglerphd

The EIC’s 2023 Work programme

ScienceBusiness has likewise published the entire library of Horizon Europe documents by the European Commission (EC) that are mostly in draft form and can be found here.

“This document represents a working draft of the EIC work programme for the purpose of feedback and comments from members of the Horizon Europe Programme Committee for the EIC and European Innovation Ecosystems. This draft has not been adopted or endorsed by the European Commission. Any views expressed are the views of the Commission services and may not in any circumstances be regarded as stating an official position of the Commission. The information transmitted is intended only for the Member State or entity to which it is addressed for discussions and may contain confidential and/or privileged material.”

Cancelling Approved EIC Accelerator Funding

Horizon 2020 has been plagued by a variety of high-profile fraud cases such as two companies which were beneficiaries of 56 projects funded under the EU’s FP7 and/or Horizon 2020 research programmes. It is only natural that the EIC has implemented clauses which enable them to cancel issued grants or to decline an investment in case certain inconsistencies are encountered during the due diligence.

“In such a case, the Commission may also request amendments or, in the cases of misrepresentation, submission of false information, non-submission of information, suspicion of fraud or any other ground listed in the EIC Accelerator contract, it may terminate your initial EIC contract covering the grant component. The EIC Accelerator contract may also be terminated if the non-investment is likely to affect the implementation of the action or puts into question the decision awarding the financial support.“

For applicants, this presents a certain risk since it is known that the European Investment bank (EIB) and the EIC are very slow when it comes to the issuance of equity investments (read: Inside the EIC Fund). If a company has requested blended finance and is asked to stay in the due diligence process for 12 months, then they might decline the EIC Fund investment but this could jeopardise their received grant financing according to the EIC.

The EIC should make an official and binding commitment that, if an applicant is well-financed from other sources (different from the EIC), they should be allowed to decline the EIC Fund investment while retaining the grant. This should be a company’s right if the due diligence by the EIB is too slow for the speed at which a company has to perform. Slow due diligence can even be detrimental to the company’s financial health if other investors could act faster.

Converting Funding Requests

The EIC’s 2023 Work Programme outlines the option for a conversion of funding modalities whereas the Step 3 EIC Jury can decide that the requested amount or funding type, which has passed Step 1 and Step 2 already, is inappropriate and can change it on-the-fly.

This likewise expands towards the EIC Accelerator Open and Strategic Challenges as well as the funding modes, namely grant-first, grant-only, equity-only and blended financing.

For the EIC Accelerator Open and Strategic Challenges, the Step 3 jury and the Step 2 evaluators can make changes to the proposal:

“If in the course of the interview the jury assesses that your proposal falls within the scope of one of the Accelerator Challenges which is open at the cutoff and meets the relevant criteria for the Challenge, then your proposal may be transferred to be funded under the relevant Challenge.”

“If your application at the full application stage is assessed to be outside the scope of the Accelerator Challenges to which is it is submitted, then it will be transferred to the Accelerator Open.”

To the detriment of the applicants, this can also include the substitution of a grant with a repayable loan.

“Should the jury find the level of risk to be lower than initially identified by the applicant, the jury may also recommend another combination of components, including substitution of the grant component by a reimbursable advance.”

The ability to convert funding requests is likely one of the reasons why the grant-first success rates exceeded other modalities since some blended financing (grant and equity) applicants were converted into grant-first applicants without the EIC officially acknowledging it or releasing this information (read: EIC Accelerator 2022 Results).

While the EIC Jury and Step 2 evaluators can make a counter-recommendation in Step 2 and 3, respectively (i.e. convert blended financing to grant-first or change the topic), this can also be done during the due diligence phase. To understand the impact of this approach, the EIC should release the statistical data of all anonymized beneficiaries with timelines and funding amounts which aids in managing the expectations of future applicants.

“Should the outcome of the due diligence conclude that the innovation or your company is not yet mature for equity investment, the EIC Fund may recommend to the Commission that you start with the grant component first, and that the investment component will be subject to reaching defined milestones that will be included in the contract for the grant component via an amendment.”

This article is part of a series whereas the remaining articles can be found here, once published:

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

Contact: You can reach out to us via this contact form to work with a professional consultant.

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, Horizon Europe, SME Instrument / EIC Accelerator

The Conditions for EIC Equity Investments (2023 EIC Accelerator Work Programme Part 3)

November 5, 2022 stephanseglerphd

The EIC’s 2023 Work programme

ScienceBusiness has likewise published the entire library of Horizon Europe documents by the European Commission (EC) that are mostly in draft form and can be found here.

“This document represents a working draft of the EIC work programme for the purpose of feedback and comments from members of the Horizon Europe Programme Committee for the EIC and European Innovation Ecosystems. This draft has not been adopted or endorsed by the European Commission. Any views expressed are the views of the Commission services and may not in any circumstances be regarded as stating an official position of the Commission. The information transmitted is intended only for the Member State or entity to which it is addressed for discussions and may contain confidential and/or privileged material.”

Equity Financing under the EIC Accelerator

Equity financing is limited to a €15 million contribution by the EIC Fund but it is possible to request higher amounts in certain cases and especially those linked to the EIC Accelerator’s Strategic Challenges.

“The minimum investment component is EUR 0.5 million and the maximum is EUR 15 million. A more than EUR 15 million investment request is allowed in duly justified cases for: proposals in technologies that are strategic for the Union; where there is a global competition; and where the funding needs significantly exceed what is available in Europe.”

In the past, the EIC Fund had a variety of problems since applicants were not aware of how the equity financing would be implemented (read: An Inside Look into the EIC Fund). Successful EIC Accelerator blended finance applicants were under the assumption that the granted funding would be issued without additional conditions only to be asked to find their own lead investors. This became detrimental to some companies in this first batch because a lack of investor interest was why they applied to the EIC Accelerator in the first place and this is also what they explained in the application.

The EIC Accelerator required companies to justify why they cannot be funded elsewhere but then demanded they find funding elsewhere. Of course, the nuances are now clearer and the EIC has become more transparent which is of great benefit to applicants. The application template now clearly outlines the role the EIC aims to take and the conditions are well-described.

What is interesting is that the rule that the EIC Fund wants to invest with an external co-investor might change in the future, at least from the perspective of the applicant.

“The investment component of the EIC is designed to fill the funding gap for high risk innovations to a stage where they can be co-financed or financed under the InvestEU programme or by private investors alone. As the EIC accelerator is designed to bear the risk of potential breakthrough market creating innovations in order to attract alternate private investors in a second stage, the lack of such investors at the initial stage would not prevent the EIC investment to be agreed.”

While the definitions of the first and second stages are not clear (i.e. grant and equity, respectively), it can be interpreted as the EIC Fund investing in a company without any co-investors as a general rule. This could be in the form of a convertible note or loan as it was implemented previously or entail a direct equity investment.

Finding Co-Investors

The EIC has already outfitted their online platform with a list of investors and it is likely that the EIC wants to become a one-stop-shop for the full investment lifecycle. Especially past co-investors who have undergone due diligence alongside the EIC and European Investment Bank (EIB) can be collected and repurposed for future investments, thus generating a large network of compatible and strategic investors over time.

“You will also be offered the opportunity to share certain data and information with investors who have undergone a prior EIC due diligence process and who may wish to invest in your company or project and assist you in developing your idea into a business plan. You will also be asked to agree to share your relevant data with alternative funding bodies of your Member State or Associated Country.”

The language of developing your idea is interesting since the support of a strategic investor (i.e. those offering strategic support alongside financing) is very beneficial in early-stage projects stemming from Universities and other scientific institutions. If the EIC manages to build a network of strategic investors based on thematic areas (i.e. battery technology, ICT, medical devices, etc.) then this can greatly enhance the success of the funded projects and turn the EIC Accelerator into an actual business accelerator and not just in name.

The term idea is used very loosely by the EIC since TRL1 projects at the idea stage are not funded. It would be advisable if the EIC removes the term idea from the online platform as well since any company that is developing an idea from Step 1 into a business plan in Step 2 of the EIC Accelerator for the first time would likely not be successful.

The language should reflect that the project is far beyond the idea stage and has reached at least Technology Readiness Level (TRL) 5 or 6 and Business Readiness Level (BRL) 5 or 6.

Aligned with the approach of building an index of strategic investors, the 2023 Work Programme draft likewise outlines that the EIC will actively search for co-investors for the applicant.

“During this stage, and in particular if you have not yet secured other investors, the EIC Fund or the Agency will also look for other investors. You will be asked for your consent before other investors are contacted or engaged in negotiations.”

Loans from the EIC Fund

While the equity investments made by the EIC Fund already use in-direct modalities such as convertible notes or loans, it is still lagging behind in realising loans as a standard investment mode. Loans are expected to be released in 2022 or 2023 although these are of the same amount as the grant funding and seem to replace it with a repayable loan while their issuance is at the discretion of the jury in the Step 3 interviews of the EIC Accelerator.

“Reimbursable advances may be introduced during the course of 2022/23 in which case the terms and conditions will be made available on the EIC website. Once introduced, they would be considered by the jury in cases where the innovation cycle (market deployment) is short. The amount would be limited to a maximum of EUR 2.5 million and will reimburse up to 70% of the eligible costs of innovation activities. The reimbursable advance will have to be paid back to the EU on an agreed schedule as an interest-free loan. In case you are not able to reimburse or do not want to reimburse, the reimbursable advance will be transformed into equity. In case of bankruptcy, the reimbursable advance will be considered as a grant and hence written off.”

This approach seems to be a way of converting grant requests into loans which allows the EIC to fund more projects that they would have otherwise rejected (i.e. not innovative and DeepTech enough but a good business model or strong financial health).

It also allows the EIC to openly fund projects with lower risk profiles which is beneficial for Public Relations (PR) since these companies are more likely to be successful and funded by the EIC at no real cost.

It can also be a way to have more female CEO’s funded under the EIC which has been a priority and challenge for many years as well as allowing more funding for UK companies who are currently limited to grant-only support (read: UK Participation & Female Entrepreneur).

On the other hand, it is unfortunate that grant applicants now face the risk of receiving a loan after spending months in the application process and reaching the less than 10% of companies that make it to the Step 3 interviews. It would be reasonable if such counter offers are only formed in case the initial application has been officially rejected in Step 3 instead of the jury forcing a company to accept a loan in the interview prior to making a decision.

This article is part of a series whereas the remaining articles can be found here, once published:

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

Contact: You can reach out to us via this contact form to work with a professional consultant.

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, Horizon Europe, SME Instrument / EIC Accelerator

Technology Readiness Levels, Timelines and Interview Priorities (2023 EIC Accelerator Work Programme Part 4)

November 5, 2022 stephanseglerphd

The EIC’s 2023 Work programme

ScienceBusiness has likewise published the entire library of Horizon Europe documents by the European Commission (EC) that are mostly in draft form and can be found here.

“This document represents a working draft of the EIC work programme for the purpose of feedback and comments from members of the Horizon Europe Programme Committee for the EIC and European Innovation Ecosystems. This draft has not been adopted or endorsed by the European Commission. Any views expressed are the views of the Commission services and may not in any circumstances be regarded as stating an official position of the Commission. The information transmitted is intended only for the Member State or entity to which it is addressed for discussions and may contain confidential and/or privileged material.”

Technology Readiness Levels (TRL)

In the new 2023 EIC Work Programme, the Technology Readiness Levels (TRL) have been slightly simplified from the previous iteration whereas the new TRL’s are as follows (read: How the EIC Funds TRL’s):

basic principles observed

technology concept formulated

experimental proof of concept

technology validated in lab

technology validated in relevant environment

technology demonstrated in relevant environment

system prototype demonstration in operational environment

system complete and qualified

actual system proven in operational environment

Deadlines

Unfortunately, the newest deadlines or cut-offs for the 2023 EIC Accelerator have not been published with the released draft of the EIC’s Work Programme. Once they are known, they will be available here: EIC Accelerator Deadlines.

While the draft of the 2023 Work Programme is still unofficial, it contained a hint that the EIC Accelerator’s first cut-off will only focus on the EIC Accelerator Open while the Strategic Challenges do not apply to the first date.

“[Cutoff dates to be inserted] [for first cut-off, only Accelerator Open (not Accelerator challenges)]”

For the EIC Pathfinder Open, the first deadline in 2023 was given as:

“The deadline for submitting your proposal is 7 March 2023 at 17h00 Brussels local Time.”

Timelines

The timelines outlined in the 2023 Work Programme for the evaluations of EIC Accelerator proposals are 4 weeks for Step 1 and 6 weeks for Step 2 but these times can vary greatly depending on the workload encountered by the EIC.

The timing is also affected by the set dates for the Step 3 interviews whereas the EIC will be faster on occasions when the interview week is close while they can be slower if the interview week is far out.

EIC Accelerator Step 3 Interviews and Budgets

The EIC’s 2023 Work Programme defines priority orders in case of limitations in the budget or interview slots encountered by applicants. If the number of applicants or their budget requests exceeds the available resources, the applications will be prioritized by their recommendation status for the interview, the sex of the company’s CEO and the timing of the initial submission.

The priority order is:

“All companies that were invited by the jury to resubmit directly to one of the next interview sessions;

Gender balance: women-led companies (up to 40% of invited companies is reached);

Submission date and time: any remaining companies will be prioritised based on the date and time submission of their short proposal.

The remaining batch of companies to interview will be invited to a further set of interviews to be organised before the interviews of the next cut-off date.”

And this priority order also applies for the budget allocations:

“In case the amount allocated to GO applicants is above the budget available, then a number of applicants corresponding to the unavailable budget will be awarded funding using the available budget of the subsequent cut-off. Such applicants will be identified using the ordering set out above for the invitation to interviews.”

This article is part of a series whereas the remaining articles can be found here, once published:

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

Contact: You can reach out to us via this contact form to work with a professional consultant.

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, Horizon Europe, SME Instrument / EIC Accelerator

How Grant-First Projects get Equity Investments (2023 EIC Accelerator Work Programme Part 2)

November 5, 2022 stephanseglerphd

The EIC’s 2023 Work programme

ScienceBusiness has likewise published the entire library of Horizon Europe documents by the European Commission (EC) that are mostly in draft form and can be found here.

“This document represents a working draft of the EIC work programme for the purpose of feedback and comments from members of the Horizon Europe Programme Committee for the EIC and European Innovation Ecosystems. This draft has not been adopted or endorsed by the European Commission. Any views expressed are the views of the Commission services and may not in any circumstances be regarded as stating an official position of the Commission. The information transmitted is intended only for the Member State or entity to which it is addressed for discussions and may contain confidential and/or privileged material.”

Financing Modes

The introduction of new funding modularities such as grant-first, grant-only, equity-only and blended financing has created confusion and added a variety of conditions that need to be considered (read: 2021 EIC Accelerator Work Programme). These especially relate to the Technology Readiness Levels (TRL) and timelines expected from the applicants (read: Technology Readiness Levels). The success rates have historically differed among these options based on data published by the EIC (read: 2022 Results) although these statistics are incomplete due to the ability of the Jury to change the funding request during the Step 3 interviews (read: Changing Grant Requests).

Grant-First Financing

An interesting development of the EIC Accelerator is the introduction of the grant-first application. As opposed to grant-only applications which foresee applicants to reach TRL9 at the end of the project (read: Funding TRL’s), grant-first is designed for very risky projects which need to define and reach important milestones before follow-up equity financing can be issued. The outcome of the grant-first project is expected to be TRL8 and should be accompanied by a milestone which can be assessed and allows the applicant to become eligible for equity investments by the EIC Fund.

In theory, the EIC Accelerator should only fund high-risk projects since the risk level is part of the evaluation criteria. In fact, the 2023 Work Programme writes:

“Financial support is provided through three main funding schemes: the ‘EIC Pathfinder’ for advanced research on breakthrough / game-changing technologies; ‘EIC Transition’ for transforming research results into innovation opportunities; and the ‘EIC Accelerator’ for individual companies to develop and scale up breakthrough innovations with high risk and high impact.”

This is its mission since low-risk and high-return projects are financed by private markets and banks. In reality, the Step 3 EIC Jury will often prefer lower-risk and high-impact projects of companies that are already interesting to private markets so it is common that a company financed by the EIC would have raised private capital anyways as well as cases such as a recently funded software company that has raised €30+ million in the past and then received grant-only support by the EIC in 2022.

It is difficult to imagine that such a company was unable to leverage financing below €2.5M from private markets after raising over €30M in the past.

It could be argued that grant-first support is the original vision of the EIC Accelerator since these projects are the riskiest and most groundbreaking projects that require a safety net in the form of milestones to assess the progress on-the-fly before further funding is committed.

“Grant First: Your innovation is based on a scientific discovery or novel technology and still requires significant work to validate and demonstrate in relevant environments in order to properly assess its commercial potential.”

If the commercial potential for high-risk grant-first projects is uncertain but, on the other hand, it is clear for other projects (i.e. equity-only, grant-only, blended) then the latter should be medium-risk at best by way of comparison since all projects must have functioning technologies already (i.e. TRL5/6: validated/demonstrated in the relevant environment).

Path to Equity Financing

For grant-first projects, the new 2023 EIC Work Programme now outlines how a company can access the equity component which allows it to reach TRL9. What is interesting is that no re-application via the 3-step EIC Accelerator application process using the online template is required (i.e. at least it is not explicitly mentioned). Instead, a formal assessment is performed which is followed by due diligence conducted by the European Investment Bank (EIB).

“Grant First: Grant-first companies are eligible for a follow on equity component subject to a milestone assessment attesting that the innovation activities are well under way and that the innovation has the potential for deployment or the interest shown by potential strategic/lead investor(s) in co-investing with the EIC into the company, as a sign of maturity of the innovation and of deployment perspective.

If the milestone assessment for a Grant First proposal is positive, you will be:

required to demonstrate that you have sufficient financial means (e.g. revenue flow, existing investors or shareholders) to finance or any remaining innovation activities and the deployment and scaling up of your innovation; or

invited to enter due diligence and negotiations to receive an EIC equity investment, including to complement any other third party investments if insufficient. Allocation of the equity investment is conditional to the due diligence assessment.

In your proposal for grant-first support, you will have to include a milestone at mid-term or at the latest 6 months before the end of the project, for the EIC to assess and decide whether to proceed or not with the negotiation and the award of an investment component.”

Considering this process, it is reasonable for all new applicants applying for blended finance or grant-first to directly include the respective milestones in the applications albeit this can also be done after the Step 3 interview has been passed successfully.

Limitations of Grant-First Projects

What is interesting to note is that, while equity financing can be used for all activities from TRL5 to TRL9, grant-first applicants are limited to only the grant component which technically limits the maximum budget that can be requested to reach TRL8 to €2.5M (including loans if they become available in the future).

For a blended finance project, financing TRL5 to TRL8 can be supplemented with equity investments which makes the maximum budget to reach TRL8 significantly larger. Considering that grant-first applications are only for the highest-risk projects, this means that the EIC will prioritize the allocation of its budget to medium and low-risk projects that receive blended financing without additional milestones.

A company with high-risk developments for artificial organs or new cancer treatments at TRL5 will be difficult to finance under the EIC because of the substantial funding requirements at low TRL’s, the need for long and expensive clinical trials as well as the limitation of grant-first applications to only obtain a grant to finance the activities.

Even in a less capital-intensive field, a project that requires €10M to reach TRL8 could not be funded without loans from other sources since grant-first applications have a maximum budget limit of €2.5M. There are still cases where an applicant can ask for larger funding amounts but this is only available in rare cases and is unlikely to be significantly higher.

There are mentions of loans provided by the EIC but these will only be available in the future since it is still vaguely described in the Work Programme. In fact, the rule that grant funding can only cover 70% of the costs is still in place so a grant-first applicant also needs sufficient co-financing or a loan by default.

“To provide for the co-financing of TRL5 to 8 activities, the EIC may introduce the option for grant-first applicants to request in their full proposal an investment component to co-finance the 30% of the costs for their TRL5 to 8 activities not covered by the grant component. If and when this option becomes available, the application form will be modified accordingly.”

Grant Budget Amounts

The 2023 EIC Work Programme also outlines the conditions for the request of higher grant amounts and longer durations:

“The grant component should normally be less than EUR 2.5 million but may be for a higher amount in exceptional and well justified cases. The innovation activities to be supported should normally be completed within 24 months but may be longer in well justified cases. “

This article is part of a series whereas the remaining articles can be found here, once published:

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

Contact: You can reach out to us via this contact form to work with a professional consultant.

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, Horizon Europe, SME Instrument / EIC Accelerator

The Eligible Applicants (2023 EIC Accelerator Work Programme Part 1)

November 4, 2022 stephanseglerphd

The EIC’s 2023 Work programme

ScienceBusiness has likewise published the entire library of Horizon Europe documents by the European Commission (EC) that are mostly in draft form and can be found here.

“This document represents a working draft of the EIC work programme for the purpose of feedback and comments from members of the Horizon Europe Programme Committee for the EIC and European Innovation Ecosystems. This draft has not been adopted or endorsed by the European Commission. Any views expressed are the views of the Commission services and may not in any circumstances be regarded as stating an official position of the Commission. The information transmitted is intended only for the Member State or entity to which it is addressed for discussions and may contain confidential and/or privileged material.”

EIC Accelerator Applicants

While the EIC Accelerator does fund software products and services, it has retained its focus on funding groundbreaking DeepTech innovations based on scientific breakthroughs and discoveries.

“EIC Accelerator focuses on innovations building on scientific discovery or technological breakthroughs (‘deep tech’) and where significant funding is needed over a long timeframe before returns can be generated (‘patient capital’)”

Non-Associated Third Countries

Next to investors and natural persons associated with an SME in an eligible country or those who are meaning to establish an SME, there are now also new eligibility criteria for other entities and natural persons from non-associated countries. It has long been possible to apply as an investor, a natural person or a parent company as long as the beneficiary, a company registered in a Horizon Europe-associated country, is established prior to signing the grant agreement contract (i.e. after the Step 3 interview was successful).

This allowed persons and entities from countries associated with Horizon Europe to pass through all three steps prior to committing to the creation of a new legal entity. This is, of course, desirable since the success rates of passing through all three Steps of the EIC Accelerator can easily drop below 5% (read: EIC Accelerator 2022 Results).

In the newest Work Programme, the EIC is expanding the rules to allow entities or persons from non-associated third countries (glossary) to apply to the EIC Accelerator if they relocate their headquarters or establish an SME in a country associated with Horizon Europe.

“One or more natural persons (including individual entrepreneurs) or legal entities, which are: From a non-associated third country intending to establish an SME (including start-ups) or to relocate an existing SME to a Member State or an Associated Country. Your company must prove its effective establishment in a Member State or an Associated Country at the time of submission of the full proposal. The Commission may set specific conditions and milestones in the contract to ensure that the interest of the Union is met.”

In contrast to the way natural persons and investors are able to proceed with the full application process up to the final step, non-associated third countries must create a legal entity prior to applying with a Step 2 full application. In the sight of the low success rates of this step, it is not advisable to relocate a business headquarters or create a legal entity prior to gaining any official approval from the European Commission (EC) and the EIC.

Globalization of the EIC Accelerator

Third countries should not take this risk unless there is another strong reason to relocate their headquarters even if the EIC funding is not granted.

It could be seen as beneficial to apply to Step 1 of the EIC Accelerator as a way of assessing the quality of a project and determining the odds of future success but it is still not recommended since the correlation of scores between all three Steps can be small while Step 3 can entirely shift the evaluation criteria (read: EIC Accelerator Interview). The final decision makers will only assess the project in Step 3 and not be involved in Step 1 or Step 2 so any assessment in Step 1 has limited predictive power.

But it is understandable why the EIC is adding this restriction. One of the major goals of the new submission system developed by the EIC and implemented in 2021 is to reduce the number of applicants and to simplify the application and evaluation process (read: The 2021 EIC Accelerator). If the EIC were to open up the full process including Step 2 (full business plan) and Step 3 (face-to-face or online interview) to major American and Asian markets then they would be overwhelmed with tens of thousands of global applicants who try their luck.

In fact, this new rule and the opening up of Step 1 might already overwhelm the Step 1 evaluations since, technically, any company from third countries not associated with Horizon Europe can apply which should lead to a rise in Step 1 applications.

Combined with the effort of the EIC to gain global notoriety through the participation in international conferences (i.e. European Pavilion at CES Las Vegas) as well as the lack of communication on the actual success rates of the program for each Step (read: June 2021 EIC Accelerator Results), it is only a matter of time until the number of Step 1 applications will skyrocket.

This article is part of a series whereas the remaining articles can be found here, once published:

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are:

~~January 11^th 2023~~ (only EIC Accelerator Open)
~~March 22^nd 2023~~
June 7^th 2023
October 4^th 2023

Contact: You can reach out to us via this contact form to work with a professional consultant.

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, Horizon Europe

EIC Accelerator Interview Preparation Process: Jury Considerations (Part 3)

October 30, 2021 stephanseglerphd

One could argue that the Question & Answers (Q&A) session that is part of the EIC Accelerator interviews requires a significant amount of the overall preparation time. With a length of up to 35 minutes after the 10-minute pitch by the startup or Small- and Medium-Sized Enterprises (SME), it can make or break a fund-raising application.

In this third part of the EIC Accelerator interview guide, the focus will be on the Q&A. This article aims to provide suggestions as to how a company can prepare and be in the ideal position to succeed during the EIC’s pitch week.

Since most companies are used to having long-lasting investor conversations prior to facing a final investment decision, even experienced management teams often have to adjust and practise for this particular, fast-paced interview session.

Core Rules

Be aware of EIC rules and agendas (i.e. what the jury is looking for)
Do not give the jury a reason to reject you (i.e. no red flags)
Do not get cornered on a topic that is of no benefit (i.e. no wasted time)

Note: This article focuses on strategies for practising Q&A sessions while the next articles will focus on how answers can be improved and developed.

How To Practise (The Mock-Jury)

Rapid-Fire Questions

When practising for the pitch interview, it is often difficult to simulate a stressful environment or have supporters who can project the demeanour that is needed for such a practice. But this is an essential part since:

We don’t rise to the level of our expectations, we fall to the level of our training.

– Archilochus

If a startup is working with a consultancy or professional writing team then they can take this role but, as a precaution, every applicant team should also make an effort to create such sessions internally. Since nobody wants to alienate their co-workers or partners with a stressful questioning session, a simple way of creating pressure is to add interruptions.

As an example: When the mock jury member asks a particular question on a certain aspect of the project which the interviewee then responds to, the questioner proceeds to cut off the answer with a follow-up question within 10-20 seconds, at a point where it is confusing, too slow or irrelevant. By using this approach, one can simulate being caught off-guard since the follow-up questions will inevitably force the interviewee to make their answers more succinct. It will likewise allow the questioner to quickly screen for weaknesses in the responses and, through multiple follow-ups, find additional areas that must be prepared in detail prior to the pitch.

Example (Interviewee / Mock-Jury)

What is your business model?
We have a SaaS business. We sell access to our software mainly to Universities and research institutes so–
How do universities pay you? Have you demonstrated willingness-to-pay or do you face long tendering processes?
Well, we do not have revenues yet but we have pilot tests with some institutes and they have told us that they would pay for this. We also have–
So this is unproven. Have you demonstrated willingness-to-pay in any core customer segment?
Well…

Recommendation

During the entire Q&A practice, it is beneficial to make interruptions a habit since these will help everyone involved to self-correct their answers and polish them in their minds before they answer. The worst practice environment for a Q&A is one where the team has unlimited time and is allowed to brainstorm as they answer the question or even discuss the answers with their colleagues. The idea is to generate a sharp answer and then move on to the next one. Developing better answers can be done afterwards.

For the mock-jury, the rule is to make almost no answer go uninterrupted.

The Devils Advocate

It is often very difficult to find someone who is able to ask good and tough questions. Consultants and writers will know the project very well while employees, investors and others will likely also be overfamiliar with the company. Additionally, since many DeepTech companies have to guard their Intellectual Property (IP), they often do not want to include additional parties in the process just to ask a few questions.

A solution can be to hire an external party since there are a variety of pitch coaches who specialise in this type of training and can be a suitable support option.

Playing the devil’s advocate can also be done with existing consultants or internal team members since the rule is simple:

Pretend that you do not know the answer and ask the worst possible questions.

Especially if you already know the technology in and out, you will know the business model, the customers and all of the weaknesses, risks and uncertainties. To develop good questions, one should look at the project in the most negative light possible. The idea is to take the side of the competitors or those who would criticise the project.

Example (Interviewee / Mock-Jury)

What is your product?
We produce and sell battery cells based on a new material.
What’s innovative about it?
With our approach, we can reduce the energy needed during battery production by 15% as well as the related costs. We–
Is the new battery as long-lasting as the conventional materials?
We do not have long-term studies yet but we expect that it will have a comparable half-life. So–
But if it does not then wouldn’t it be a pointless product? What half-live benchmark do you have to reach to make sure that the 15% upside remains relevant for customers?
We have not calculated that yet but do not see this as an issue.
It sounds to me that your competition is still the better alternative until you can validate your half-life. Is that wrong?
Well…

Recommendation

As a mock-jury member, highlight the weaknesses of the innovation and overexaggerate the benefits of competing products. Question the existence of the innovation in the market to create a robust set of answers.

Looking for Flaws

The EIC Jury interview might be a pleasant experience but it can also turn stressful and be riddled with criticism. As an old saying goes:

Prepare for the worst. The best will take care of itself.

There might be one Jury member who is looking to criticise, who accepts no response to be good enough and who has already made the decision that they do not like the project. Unfortunately, there are many accounts of rejected applicants who found the interview to be stressful and at least one of the EIC jury members to be unpleasant.

If this happens then it is unfortunate but it is one more reason to prepare for such a case.

The principle of practising to look for flaws is simple: Try to entrap the interviewees and corner them in a place where they do not want to be. This can be because they do not know the answer, they have never thought about this or because the answer might lead to even worse questions.

Being critical does not mean that the questioner needs to be unpleasant. On the contrary, playing the role of someone who is looking for flaws can be good practice for everyone involved. If one of the interviewees just stepped into a trap and looks confused while the other two interviewee’s try to suppress their laugh then the practise session is going well.

Example (Interviewee / Mock-Jury)

How much financing have you raised so far?
In total, €2.5M from grants and angel investors.
Are you in discussions with other investors now or expect other investments in the coming months?
Yes, we are talking to Venture Capitalists regarding a bridge round at the end of the month.
How much are they considering to invest?
We are discussing a €1M investment but it can also be higher.
Then is it not best if we wait until they have made the decision and you apply again to the EIC in 3 months?
…

Recommendation

Have one person (the mock-jury) ask questions and follow-ups that progressively become more difficult to try and entrap the interview candidates. These traps will be the basis for the improvement strategies for answers discussed in the following articles.

Learn the Rules & Read the Application

It can be assumed that a majority, if not most, of the applications that are selected for the Step 3 interviews of the EIC Accelerator have either been written by consultants, professional writers or with the strong support of the startup’s employees (i.e. delegation of tasks). No matter how the company reached this last stage, it is likely that the three interviewees are not entirely familiar with all the application documents.

While many might think “I know my company in and out already!”, it would be a fatal error to not be perfectly familiar with the application. With three team members being invited to the EIC’s pitch week, it is not necessary for everyone to know everything but, as a collective, all three team members should know the entire application like the back of their hand.

The CFO should know the financial spreadsheet, the cashflows given in the Technology Adoption Lifecycle (TALC), the work package budgets and all related financial aspects. The CTO should know the development tasks, should be familiar with all the features and uses cases as well as know what the exact pain points described in the application are.

The team should distribute all proposal documents to assure that at least one person knows the relevant information. In addition, all three interviewees must know the EU’s and the EC’s rules which are described in the previous article to avoid displaying red flags (i.e. non-bankability, strategic challenges, risk-level).

Example (Interviewee / Mock-Jury)

What developments are you planning under the EIC?
We want to optimize our production process, get certifications for the resulting hardware and develop the AI software.
What budget are you allocating for the production process optimization?
We expect this to cost approximately €0.8-1M.
I have seen your Work Package 5 and it shows a very different number there. It list €450K for the production process. Why the discrepancy?
…

Recommendation

Practice asking precise questions on the proposal documents. These can include the Freedom to Operate (FTO) report, the budget, the competitors and many more sections.

Choose Who Answers What

It is critical for the team to assure that the most suitable expert will be answering the questions in their field of expertise. This can be difficult due to time constraints and it can also be hindered by the most confident member of the team taking the answering role out of pure habit (i.e. the CEO answering a financial question while the CFO remains silent). Suggestions to mitigate any problems are:

Give each person a topic

As an example, the CEO answers business model and market questions, the CTO answers technical questions and the CFO answers budget, investment and financial questions. This sounds simple but there can be significant issues that only become obvious during practice.

What if the question is financial in nature but it asks why the technical development costs are so high? This question might be too technical for the CFO. What if the commercialisation question overlaps with technical customer pain-point or the willingness-to-pay? There are many situations in which the ideal person will be ambiguous. Thus, it should be practised diligently.

Sit in the same room

It is much easier to transfer questions if the team sits right next to each other. The CEO can nod at the CFO and if one person decides to jump in then this can be well-timed as opposed to yielding awkward interruptions or confusion during a video call.

Note: This is only applicable for video calls and not for in-person pitch events in Brussels where all team members are in proximity by default.

Practise question allocations

Since questions will likely overlap greatly when it comes to the themes or topics, it is beneficial to practise this in every pitch session. What must be avoided is that the CEO or the most vocal team member ends up answering all questions. If one person has already answered questions for 15 minutes then it is likely that no other team member will dare to jump in since they are not used to it. It will be beneficial if the team members become accustomed to answering questions as a unit and have an almost immediate response without any awkward looks or confusion as to who should answer.

Conclusion

This practice routine illustrates how the team can integrate critical questioning into their mock sessions while it likewise hints at methods for their preparation. It is recommended to select one or more questioners who can play the devil’s advocate and aim to pressure the team through frequent interruptions.

The following articles will present strategies to develop perfect answers to questions and, most importantly, develop a framework to master unpredictable questions that would catch the team off-guard. This will help the interviewees to not end up in the critical situations given in the examples above.

Developing Unique Selling Points (USP)

Starting With the Innovation

1. Why does your technology have this feature but not others?

2. Is it hard to copy?

3. Is it patentable?

4. How do you quantify the benefit per unit? (i.e. 50% less time-spent or €50K lower costs per device)

5. What does this benefit mean for your customer? (i.e. €250K saved p.a. and 100 MWh of additional capacity)

Conclusion

The EIC’s 2023 Work programme

The EIC Ecosystem

Fast Track and Pilot Plug-in Schemes

Outlook

The EIC’s 2023 Work programme

The EIC Accelerator Open and Strategic Challenges

Challenge 1: Novel biomarker-based assays to guide personalised cancer treatment

Challenge 2: Aerosol and surface decontamination for pandemic management

Challenge 3: Energy storage

Challenge 4: New European Bauhaus: Digitisation for sustainable and inclusive built environment

Challenge 5: Quantum computers hardware and real environment quantum sensors

Challenge 6: Sustainable and resilient agriculture

Challenge 7: Customer driven, innovative space technologies and services

The EIC’s 2023 Work programme

Evaluation Criteria for the Short Application (Step 1)

Complaints and Rebuttals for Step 1 Rejectees

Evaluation Criteria for the Full Application (Step 2)

Step 3 Interview Criteria

The EIC’s 2023 Work programme

Cancelling Approved EIC Accelerator Funding

Converting Funding Requests

The EIC’s 2023 Work programme

Equity Financing under the EIC Accelerator

Finding Co-Investors

Loans from the EIC Fund

The EIC’s 2023 Work programme

Technology Readiness Levels (TRL)

Deadlines

Timelines

EIC Accelerator Step 3 Interviews and Budgets

The EIC’s 2023 Work programme

Financing Modes

Grant-First Financing

Path to Equity Financing

Limitations of Grant-First Projects

Grant Budget Amounts

The EIC’s 2023 Work programme

EIC Accelerator Applicants

Non-Associated Third Countries

Globalization of the EIC Accelerator

Core Rules

How To Practise (The Mock-Jury)

Rapid-Fire Questions

The Devils Advocate

Looking for Flaws

Learn the Rules & Read the Application

Choose Who Answers What

Conclusion

Other Articles

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