A wide range of business funding options are available for small and microbusinesses across the UK. From start-up and small business grants to small business loans and other opportunities for financial support. These opportunities can often be lifelines for new start-ups and micro enterprises. Particularly with options such as Innovation Grants, which are designed provide organisations with help to grow and develop their ideas.
In this article we explain everything you need to know about Innovation Funding, answering frequently asked questions such as ‘What is innovation funding?’, ‘Who’s eligible for this type of funding?’ and ‘Can microbusinesses apply for innovation grants?’.
We also speak to Jo Derbyshire who has over 25 years’ experience in the innovation and enterprise sector, to find out how much Innovate UK grants typically are, how likely you are to secure funding and more.
What is Innovate UK Grant Funding?
Innovate UK provides financial support for new science and technology ideas as part of UK Research and Innovation. They provide grants for businesses, charities and other organisations who are looking to build upon their ideas. This can be anything from large-scale projects that require lots of funding to smaller, more niche ideas that can be brought about using a more modest budget.
These types of grants are often referred to by the government as ‘innovation competitions’. Live innovation grants in the UK at the moment can be found here.
How do I apply for Innovate UK funding?
To apply for this type of funding, head over to the Innovation Funding page on the government’s website. Here, you’ll be able to choose which grant you’d like to apply for, check your eligibility and apply for funding.
What types of businesses are usually eligible?
Most businesses are eligible to apply for innovation funding, but which types of businesses are most likely to succeed?
To find out, we spoke to Jo Derbyshire from Cresco Innovation who told us that businesses with the following characteristics are more likely to be successful when applying for innovation grants:
Innovation. “Obvious I know, but don’t underestimate the high bar for this. You have to demonstrate that you are creating new knowledge which will enable you to get ahead of the competition. The innovation must be more than an incremental improvement. The best applications have a competing technology table, showing how the new innovation differs and is better than what already exists.
Market Pull. “You need to be able to show that if you develop your product or process, people will want to buy it. Ideally you will already be in discussion with potential end users/customers, and can evidence this.
Risk: “It’s important to show that this project is risky and difficult, and therefore you need grant funding. You need to show that the project might fail, but that you have a well-rounded and experienced team who know how to manage this type of project”
Can microbusinesses secure this type of funding?
“Absolutely!” Jo says, “Many of our clients are micro businesses. Some of our start up businesses have managed to secure seven figure sums. These grants are all about realising your potential, so it’s not about where you are now, but where you want to be.
“Here are some examples of micro businesses who’ve secured innovation grant funding:
- An east midlands micro -business developing a medical device, with two founder Directors/employees secured an Innovate SMART grant for £170,000 followed by a COVID grant of £50,000
- A Nottingham company with one founder, pre revenue, secured a European grant for €50k to carry out a feasibility study
- A London fintech company secured two Innovate grants, one for £250k and one for £1M+ (they are now more than 10 employees!)
“Actually at least 50% of our clients are micro-businesses!”
How much are the InnovateUK Grants typically?
“Anywhere between £50k and £5M. There is usually a matched funding element in any project. For a micro business you will have to contribute up to 30% of the project costs yourselves.”
What advice would you give to micro businesses who are considering this type of funding?
“If you have a genuine innovation, and are sure that the market wants it, then go for it. These grants have been life changing for some of our clients.”
We hope this article has been useful in providing you with everything you need to know about business innovation grants in the UK. We wish you the best of luck with your application if you decide that a government innovation grant is the best option for your business.