Grant Thornton
Grants Can be a Useful Source of Funding for a Technology Business
Grants can be a useful source of funding for a technology business but knowing which one to apply for can be a minefield.
This fact sheet summarises the key grants that are currently available to technology businesses and how to qualify for them.
In general, apart from areas that have been allocated 'assisted area' status, grants do have limited availability and are, therefore, provided to those who are successful in a competitive application. It is also worth being aware that grants can take some time to obtain; that application paperwork can be onerous to complete; and that the conditions that are attached to the provision of individual grants can sometimes be difficult to adhere to. Nonetheless, if you can obtain a grant that is appropriate to your business it can contribute to your funding requirement and may assist you to carry out a project you would be unable to fund otherwise.
Should you apply for a particular grant? Among the factors that usually need to be considered when deciding whether a grant application is appropriate are:
| maximum grant available | |
| proportion of project costs that can be claimed | |
| whether the application is limited by technology and/or by business sector | |
| whether it is focused on pre-competitive or near-market developments | |
| application requirements and how long it is likely to take to fulfil these | |
| company eligibility (many are limited by company size and ownership) | |
| whether collaboration with another organisation is required | |
| typical success rates | |
| profitability record requirement | |
| reporting requirements once grant has been awarded and cost of carrying this out. |
Types of grants
Grant for R&D
The Department Of Trade and Industry's SMART scheme operated prior to 1 June 2003 when the Grant for Research and Development was introduced. BERR, Dept of Business Enterprise and Regulatory Reform have taken over the role of the DTI and the levels of funding for each type of grant awarded have gone up. From 1 April 2005 Grant for Research and Development will be delivered across England by the Regional Development Agencies. Details of maximum funding are correct for January 2008.
Subject to certain criteria being met, help is available in England for:
Micro Project awards up to a maximum grant of £20,000, for the development of simple low-cost prototypes of new products & processes.
Feasibility Study awards up to a maximum grant of £100,000 for a technical & commercial feasibility study into highly innovative technology.
Development Projects involve the shaping of industrial research into a pre-production prototype of a technologically innovative product or industrial process. A grant of up to £250,000 was available for businesses with fewer than 250 employees.
Exceptional Projects involve technology developments, which have higher costs. These projects are likely to generate much wider economic benefits and must have strategic importance for a technology or industrial sector. A grant of up to £500,000 was available to businesses with fewer than 250 employees.
LINK Collaborative Research
The LINK programme aims to accelerate the exploitation of technology by funding projects that bridge the gap between industry and the research community. Projects must involve at least one partner from the research community and one from industry. Projects typically last for 2-3 years with support of up to 50% of total project cost. The programmes that are currently 'open' are in the following areas:
· electronics/communications/IT
· food/agriculture
· biosciences/medical
· materials/chemicals
· energy/engineering
European Union Projects
EU Framework Programme
The Seventh Framework Programme (FP7) bundles all research-related EU initiatives together under a common roof playing a crucial role in reaching the goals of growth, competitiveness and employment; along with a new Competitiveness and Innovation Framework Programme (CIP), Education and Training programmes, and Structural and Cohesion Funds for regional convergence and competitiveness. It is also a key pillar for the European Research Area (ERA).
The broad objectives of FP7 have been grouped into four categories: Cooperation, Ideas, People and Capacities. For each type of objective, there is a specific programme corresponding to the main areas of EU research policy. All specific programmes work together to promote and encourage the creation of European poles of (scientific) excellence.
FP7 website
EUREKA
Applications may be made from organisations seeking to collaborate with international partners within the Eureka network.
EUREKA is a pan-European initiative for promoting collaborative industry-led R&D in fields of advanced technology, in a network encompassing 36 countries.
The benefits for UK companies collaborating in EUREKA include access to new technologies, the sharing of costs and risks, reduced timescales, and access to new overseas markets.
Applicants considering applying to Collaborative R&D to fund their participation in a EUREKA project should contact the UK EUREKA UNIT at an early stage and the application should be copied to the EUREKA Unit to ensure formal endorsement as a Eureka project.
Other
From time to time there are other opportunities for grants that have even more specific terms such as BRITECH which provides active support for collaborative R&D ventures between British and Israeli companies.
http://www.britech.org.uk
Local initiatives for grants may include such opportunities as reduced rentals or subsidised employment costs and are best sourced locally. Similarly, from time to time there may be Government initiatives that will assist your business. Most recently, these have been associated with employment of those who have been unemployed for some time.
Contact George Siemieniuch
Grant Thornton
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David Kingham
Oxford Innovation
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Oxford
OX2 0JX
T 01865 811109 F 01865 209044
E d.kingham@oxin.co.uk
http://www.oxin.co.uk
Oxford Innovation manages ten Innovation Centres in Southern England, providing flexible premises and access to funding to over 140 innovative companies. At Grant Thornton, we are committed to providing a highly professional and pro-active service to help all of our clients meet their financial objectives, both business and personal. We have produced this fact sheet as part of this service but it is intended only as a guide in highlighting general issues which may be of interest to our clients. It is not a substitute for full professional advice and specialist assistance should be sought in relation to any particular circumstances. Accordingly no responsibility for loss occasioned to any person acting or refraining from acting as a result of any material in this publication can be accepted by Grant Thornton. Grant Thornton, the UK member firm of Grant Thornton International, is authorised by the Institute of Chartered Accountants in England and Wales to carry on investment business.