As Horizon 2020 draws to an end, calls transition to the new framework, Horizon Europe. Among them, the SME Instruments, which undergo significant changes starting from this year. This article provides an overview of these changes and some insight into what to expect.
No more SME Instrument Phase 1. September 5th 2019 will be the last deadline for this call. Phase 1 of the SME Instrument was originally conceived to pave the way towards Phase 2 and Phase 3 funding. As the revamped Phase 2 will focus on the late stage before scale-up, a significant gap between Phase 1 and Phase 2 would have been created. Thus, the decision was taken to discontinue Phase 1.
Goodbye SME Instrument Phase 2, hello EIC Accelerator Pilot! Although the deadlines on October 9th 2019 and all throughout 2020 still fall under ‘SME Instrument’ (no specific phase this time), the goal is to change this call into the EIC Accelerator Pilot within Horizon Europe. Although similar in many ways, there are several key differences between the previous SME Instrument Phase 2 and the upcoming EIC Accelerator Pilot (SME Instrument) that may affect your decision to apply:
- the EIC Accelerator Pilot aims to focus on supporting the brightest and boldest entrepreneurs, instead of companies. This means a more rigorous assessment of the management team.
- starting from October 9th 2019, the SME Instrument (soon to become the EIC Accelerator pilot) will offer the blended finance option, with grant only support to a maximum of €2.5 million (at a 70% funding rate) and an equity component, for up to €15 million. Proposals with activities up to TRL8 will be funded by grants or a blended finance option (at the discretion of the applicant). Close to market activities (TRL9 and above) will “only be financed by equity participation as long as the proposal remains non-bankable” (according to the new guidelines(1)). Importantly, ‘change into blended finance’ is now a possible outcome of the evaluation process, in addition to ‘go’ or ‘no go’. This will be possible if the evaluation concludes there are activities above TRL8 and if the applicant has given their consent in the application for such a possibility. If consent to replace the initial grant requested with blended finance is not expressed, but the evaluation concludes that should be the case, the proposal will be rejected.
- upon the positive evaluation of successful proposals that include blended finance, the next step will be to prepare the grant agreement (for the grant component), to be signed between the Commission and the company. For the equity component, the companies will be referred to the SPV team for a due diligence process. The SPV will check whether the company qualifies for the equity component.
More complex submission package. The EIC Accelerator Pilot (SME Instrument Phase 2) Part B structure now has several mandatory elements:
- Document 1, consisting of an introduction, Excellence, Impact and Implementation;
- Document 2: Security and Ethics, CVs, Others;
- Document 3: Financial and corporate information, supplied as an Excel file
- Document 4: Pitch-deck (provided as .pdf), now submitted at the same time as the proposal.
At Bee Granted, we are excited about the new prospects Horizon Europe has in store and are looking forward to the impact created by the new framework.