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SME Instrument: Opportunities for Swiss companies

12th April 2018 at 11:40 am

In 2014, with the launch of Horizon 2020, the European Commission had introduced a new funding scheme dedicated specifically for fostering innovation by small and medium-sized enterprises (SMEs): The ‘SME Instrument’. But Swiss SMEs had been blocked from this scheme initially, while Switzerland was not fully associated to Horizon 2020. Only the full association of Switzerland as of 1 January 2017 had enabled Swiss SMEs to fully benefit from Horizon 2020’s SME Instrument programme. This new opportunity sparked high interest and led to a large number of applications from Switzerland to both Phase 1 and Phase 2. While Swiss SMEs did well in securing Phase 1 funding (58 projects funded with a total of €2.9 million), only a single Swiss SME survived the tough competition for Phase 2 funding (€1.5 million funding). We are proud and honoured to have been able to support this successful company (more information on this exciting project in a separate blog post).

Of the 58 total Swiss projects, 22 secured funding following the latest cut-off date for the phase 1 SME Instrument. In total there were 2009 proposals received, of which 257 were successful. Meaning the success-rate was close to 13%.

As of 2018 there have been some adjustments to the SME Instrument scheme (see our updated blog post). The two most important changes are that 1) there are no more pre-defined topics, but a single bottom-up call and 2) there will be a face-to-face interview as part of the evaluation process. Apart from that, the basic structure of the funding scheme, as outlined below, remains the same.

The three phases of the SME Instrument

The European Commission envisions three phases for an SME to launch their innovative product, process or service: The feasibility assessment, the innovation project and the business acceleration. Each phase has a differing amount of funding, length and expected outcome.

Phase 1: Feasibility assessment

The phase 1 funding offers a lump sum of €50,000 per project for SMEs wishing to asses the technical feasibility and commercial potential of a breakthrough innovation. The expected outcome of an SME Instrument phase 1 funded project of maximum 6 months duration is a feasibility study, including a business plan. Not every innovation will be developed after leaving this phase. But should the SME come to the conclusion that their idea has the potential to be developed to the level of market maturity, they may apply for phase 2 funding.

Phase 2: Innovation project

Has a project passed through phase 1 or the SME already has a sound business plan, it is eligible for phase 2 funding. Phase 2 projects can receive up to €2.5 million or more, covering up to 70% of all eligible costs. The outcome of a phase 2 project is an innovative product, process or service that is ready to conquer the market. In contrast to other programmes, the evaluation of a phase 2 proposal now includes a face-to-face interview alongside a remote assessment.

Phase 3: Business acceleration

The EC will further facilitate the commercial exploitation resulting from a phase 1 or phase 2 SME Instrument by supporting further developing investment readiness, linking with private investors and costumers through brokerage activities and events, assistance in applying for further EU risk finance, and a range of other support activities and services.

Upcoming SME Instrument cut-off dates

The SME Instrument does not have a single deadline but multiple cut-off dates by which the SMEs must apply.

SME Instrument phase 2 (SME-2)

SME Instrument phase 1 (SME-1)

How accelopment can help your SME

accelopment has vast experience in writing European grant applications. This experience includes project proposals for the SME Instrument, including the first Swiss phase 2 SME Instrument TEEWood. Once approved, we can support you in the contract negotiations and provide project management support.