How to Get Billions for Your SME Thanks to Europe?

Small and medium-sized enterprises (SMEs), are considered to drive the economy of the European Union by creating jobs and contributing to economic growth.

A Eurostatreport on SMEs from 2015declared that 9 companies out of 10 in Europe are SMEs. They are key partners in European research and innovation projects. And the European Commission is hand-picking businesses to invest in and support as part of different programs made especially for SMEs.

With billions of euros at stake, you may consider reading this quick summary about where is the European funding for your SME’s R&D project.

€8 billion from the H2020SME instrument for innovative processes, services, and marketing

This program addresses the financing needs of internationally oriented SMEs.

The aim is to sustain projects that bring evolution to how business is done. If a project is about changing the products, processes, services, and marketing with a European dimension, then it might apply.

All types of innovative SMEs can apply if it has a strong ambition to develop, grow and internationalize. It is open to all types of innovation, including non-technological and service innovations.

It is structured in three phases:

• Feasibility assessment or phase 1, for a concept and feasibility assessment.
• Innovation project or phase 2 for demonstration, R&D and market replication.
• Commercialization or phase 3.

In H2020 the target set by the European Council and Parliament is to allocate to the SMEs at least 20% of the budget for “industrial primacy” and “societal challenges”, which means around €8 billion. As an example, for phase 2 projects, the EU may contribute from €0.5million up to €2.5 million per project. They finance 70% of the total cost of the project in general. Note that the average success rate is 12%.

Partnering is not mandatory to apply. But, in the Work Programme 2016-2017 of H2020, we can read that one of the objectives of phase 3 is to create opportunities for participating SMEs to partner, network, and training.

€317 million from the EUREKA initiative for microsystems and telecommunications

EUREKA was launched to strengthen the competitiveness of European industry. Public and private companies and research laboratories are invited to propose cooperation projects on themes and partnerships of their choice to develop products, processes or services that will go on the market.

It is a European, intergovernmental initiative. It works with strategic initiatives called “clusters” that are long term projects carried out by companies. In particular, high-tech SMEs, that represent an average of 40% in number and about 15% in money, of the companies that are funded through cluster projects.

After an evaluation within the Eureka bodies, the projects benefit from a “label” which allows them to access financial support in most cases.

Funding is concentrated on a few strategic sectors:

• Microelectronics.
• Microsystems, interconnection, and packaging.
• Software “middleware”.
• Telecommunications.
• Control of the energy chain and renewable energies.

These programs are managed and financed by national organizations. For example, in France by the Direction for Competitiveness, Industry, and Services of the Ministry of the Economy, Industry and Employment (called D.G.C.I.S.), through the Competitiveness Fund Companies). Each country has its own procedure. You better contact the organization in charge to get the detail of it.

As an example, from 2010 to 2014, €350 million were invested in various projects from industrial technology to health, including the environment.

Contributions go from €6 million (development of an anti-cancer drug) to €317 million (development for advanced patterning).

€290 million from the EUROSTARS program for products, technologies, and relations with new partners.

The EUROSTARS program supports innovative SMEs involved in European collaborative projects. Its primary targets are companies that make major investments in R&D.

It favors a bottom-up approach: all areas of technology, products, processes, and services are targeted, as long as they are market-oriented.

The leader of the project must be a high-tech SME. That means an SME that devotes 5 E.T.P. (Full-time equivalent) to R&D for 100 employees and 10 E.T.P. beyond.

The project is intended to be an innovative product, process or service close to the market. Meaning it should be commercialized within 2 years after the end of the project. Also, the development phase is 3 years maximum.

The total program budget is €1.14 billion from 2014 to 2020. For now, 472 projects are funded for estimated public funding of €290 million with a 30% average success rate.

The EUROSTARS program enables the SMEs to develop:

• products, technologies.
• presence in new markets.
• relations with new partners.
• knowledge.

And to develop and/or consolidate:

• their technological positioning.
• recognition and visibility of the skills of their company.
• a European network.

€1.4 billion from the COSME program for access to funding and competitiveness of SMEs

Complementing Horizon 2020, the Competitiveness and Enterprise Program (COSME) focusses on providing growth finance for relatively mature SMEs. It aims to make it easier for SMEs to access finance from their creation to their expansion, or business transfer.

The majority of the actions financed are aimed at all companies, but some are dedicated to “clusters”. They are implemented through calls for proposals.

It has a budget) of €2.3 billion for the period 2014-2020 and almost €1.4 billion (or 60%)is allocated to the financial instruments of the program. The European Investment Fund is in charge of implementing the instruments. The European Commission co-finances between 40% and 60% of the projects.

It builds on the success of the former Competitiveness and Innovation Program (CIP) and focuses on four main areas:

• Improve access to funding for SMEs.
• To strengthen the competitiveness and sustainable development of European companies.
• To encourage an entrepreneurial culture, especially among young people.
• To develop market access, both inside and outside the EU.

After reading this article you probably came to the conclusion that Europe offers many opportunities to develop a project in your SME, and you’re absolutely right. You probably also understood that it is important to grow a network and to partner to maximize your chances to get such fundings.

Bottom line is if you have ideas for your SME and you are motivated you should definitely expand your network and try and apply because Europe is waiting for you.