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Amount of Ownership Offered: The guidelines suggest to offer a minority ownership of at least 10% and up to 25%.
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Exit Strategy: There is a specific section in the proposal which asks you to describe your exit strategy or your plans for the company once it has been scaled. The EU is looking at 7-10 year time frames regarding the ROI with a maximum of 15 years. Exit strategies can be buyouts, IPO’s, liquidations, etc.
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Company Valuation over Time: You are asked to describe the progression of your company valuation using past data and your future projections, including the reasoning behind them.
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No revenues and non-bankable: The equity contribution is directed at high-risk companies with limited or no turnover and negative EBITDA’s. This usually excludes profitable companies which are only seeking scaling support and rather targets research-heavy projects. It also defines high-risk businesses as having no interest from the market or investors just yet.
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TRL9 activities: The equity financing is exclusively targeted towards Technology Readiness Level 9 (TRL9) activities which relate to market deployment as opposed to technical developments. This, in turn, means that if a grant is requested for activities related to product deployment and marketing then this will either be ineligible or will be transferred to equity financing.
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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 11th 2023(only EIC Accelerator Open)March 22nd 2023- June 7th 2023
- October 4th 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:
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- EIC Accelerator Interviews: Pitch Deck vs. Proposal Documents (SME Instrument)
- Choosing a Good Project for the EIC Accelerator (SME Instrument Phase 2)
- The EIC Accelerator Budget: Grant vs. Blended Finance (SME Instrument Phase 2)
- EIC Accelerator – Introduction and Blended Finance (SME Instrument Phase 2)
- EIC-Accelerator Writing: Providing the Missing Link (SME Instrument Phase 2)
- The Biggest Mistakes When Applying to the EIC Accelerator (SME Instrument Phase 2)
- Identifying a Broad Vision for an EIC Accelerator Project (SME Instrument Phase 2)
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