If you’re reading this, you may currently be acting as a company’s CEO, CTO, CFO, Head of Business Development, or any other role dedicated to the ongoing success and growth of your company. Though the day-to-day tasks of these roles may differ, it stands with reason that most, if not all, of them at some point take into account the existing and available funds of your company (and the guarantee that such funds will continue to exist). Surely, available funds do not only serve as a validation to the company’s success, but it is also the existence of such funds that ensure a company will be able to experience sustainability, expand & scale, offer high-standard services, launch new products, and so much more. Therefore, it is likely a collective agreement that your company must always have available funds to work with. Whether you have or have not gone down the more widely considered investment paths, we’d like to presently suggest a much less considered, but highly lucrative, funding opportunity: the EU’s Horizon 2020 funding scheme. In this article, we’ll introduce this funding opportunity that is far too often overlooked or dismissed by companies. By the end, we hope you may choose to further consider this as your long-term funding path.
A closer look at the Horizon 2020 funding program
Horizon 2020 is the biggest EU Research and Innovation programme with nearly €80 billion of funding available over the course of the 7-year program (from 2014 to 2020). This funding program funds Collaborative Projects, in which partners can come from academia, industry, SMEs (Small-Medium Enterprises) and any other types of legal entities. Its vision is to address grand societal challenges or strategic industrial challenges, and strongly emphasizes excellent science and industrial leadership. The EU Horizon 2020 funding program is a top-down scheme which means the project must adhere to specific topics’ definition in the work program. The Horizon 2020 grants are known to be highly prestigious and competitive. Overall, successfully securing funding from this program can be an incredible boost and push forward for companies.
Budget as a leading added value in Horizon 2020
Different from the well-known business investment models, and compared to other less lucrative public funding agencies, Horizon 2020 funds have unique advantages which make this opportunity truly rewarding.
Horizon 2020 grants:
- Are pure non-diluting grants. Essentially this means that your company won’t need to give any equity or royalties away as part of the funding agreement. Surely, this is a very different course when compared to most other investment opportunities.
- Bring stability. Basically this means that once your company is granted, the funding is secured for the full duration of the project. Typical R&D projects under Horizon 2020 run for 3 up to 5 years, with the exception of the EIC Accelerator grant which runs for 2 years.
- Have a fixed and stable funding rate for the full duration of the project.
- The funding rate is either 70% or 100% of the project’s budget. The declaration about the funding rate, whether it is 70% or 100%, directly derives from the nature of the targeted Horizon 2020 topic.
- Have a wide range of available budget per topic. This may span anywhere between 2 to 15 million Euros per project. Similar to the funding rate, the selected overall budget per project derives from the nature of the targeted Horizon 2020 topic.
The consortium-based structure in Horizon 2020
All Horizon 2020 projects require a consortium-based structure. By definition, the consortium must have partners from at least three different countries (be it EU member states or associated countries). We usually recommend having more than 3 partners, but this is topic-dependent and should be assessed accordingly. Constructing a relevant and strong consortium is a very important task. The consortium and its ability to properly implement the project and answer the call for proposals is a key part of the proposal’s evaluation. Furthermore, the chosen partners will work together for the duration of the funded project, so there is a lot at stake in choosing the right members.
While this requirement may propose new challenges for companies, it also holds much-added value and potential. To start, the requirement to have partners from at least 3 different countries means there exists an innate potential to establish new international collaborations. Such collaborations can ultimately be a huge push to the growth and development of your company. Expanding internationally is very often a goal for many companies, with the vision to increase its customer base and brand awareness as much as possible. Therefore, such collaborations can be an excellent added value in this regard. Second, it is important to note that the type of consortium partners can be of any kind – research, development, exploration, engineering, validation, testing, marketing, “Go to market” (potential clients, trial locations, authorities, etc) and many more. With this in mind, new collaborations can be introduced, services improved, new products launched, and so much more.
Intellectual Property Rights (IPR) in Horizon 2020
IPR issues are always important and of interest to companies that are involved in research and development activities. Horizon 2020 IPR rules are simple and easy to follow, and in general, enable any company participating in these projects to fully exploit the benefits of Horizon 2020 without jeopardising their Intellectual Property.
Below is a brief overview of the IPR rules and benefits for companies participating in these projects:
- The EU will not pose any constraints or limitations about IP that was brought into the project or developed during the scope of the project.
- The EU does not limit any transfer of IP in any form (inside or outside the consortium).
- The EU requires that a dedicated consortium agreement will be signed between the partners of each project to regulate a variety of aspects, including the IPR.
- A consortium agreement is a regular commercial agreement between the partners, which excludes the EU. Amongst other things, typically it will refer to 3 IPR aspects:
- Background: declare and protect the IPR of any IP brought into the project, by any of the partners.
- Foreground: define, declare and coordinate the IPR of any IP developed in the scope of the project.
- Access Rights: whenever this becomes relevant, define the access rights of any of the partners to specific IP, be it Background or Foreground IP.
- The consortium members have the freedom to decide about the governing instructions of the consortium agreement and articulate them, without any involvement of the EU.
To sum this point up, the EU employs a very free and liberal approach when it comes to IPR. As a result, IPR concerns should not be a barrier to any interested company, when considering participation in Horizon 2020 projects.
As we hope you can see – the Horizon 2020 funding scheme can be an excellent opportunity for acquiring funding for your company. While the current Horizon 2020 program is in its final years – keep in mind that there are still available calls to be exploited and that the following Horizon Europe program will have substantial funds and a very wide selection of calls topics for you to explore. If you have any questions, or would like us to help you as you head out on this new funding path, begin with this customized call screening service.