Horizon 2020 opens its SME programme

March 17, 2014

Horizon 2020

On 1st March, the European R&D grant funding programme Horizon 2020 – the successor to the 7th Framework Programme – finally opened its long-awaited “SME Instrument”. This is the part of the programme that is specifically dedicated to small and medium-sized enterprises and designed to be small business friendly – in comparison with the rest of the programme, that is. It’s not completely bottom-up but can nevertheless help to fund a broad range of projects across all the thematic parts of the programme.

Of course, obtaining European grant funding is always going to be more complex and time consuming than the UK equivalents. Even in the SME scheme, the time it will take from preparing your application to starting your project is likely to be at least nine months, during which time you won’t be able to start the work and you won’t know whether you’ll definitely get the funding. The paperwork can be daunting, not only during the application stage but also during the project itself, when you’re expected to prepare progress reports and financial claims with great accuracy and regularity. And don’t expect payments to arrive very quickly either, particularly if your paperwork wasn’t quite 100%.

Two new features of the Horizon 2020 SME Instrument offer some hope that perhaps it’s not so bad and may all be worth it. For the first time in a European Framework programme, individual SMEs can apply for the SME funding without the need for a European consortium. Also, the funding rate can, under some circumstances, be as high as 100%. However, before you get carried away and start applying, do bear in mind a few caveats. The European Commission is always going to want to see a clear European dimension to any of the projects that it funds. The most convincing way to demonstrate such a European dimension would be to apply not as an individual company but as a consortium involving partners from other European countries, which brings you right back to where we were under the previous Framework Programme. Technically you don’t have to do this and your project can have a European dimension in other ways, but time will tell how realistic that is. Also, almost without exception the 100% funding rate only applies to early-stage feasibility studies and is provided in the form of a lump sum of 50,000 Euros. Any serious R&D project will almost certainly attract 70% funding, which is not a bad rate until you consider the other points  mentioned.

Despite all these issues, Horizon 2020 funding can be very helpful under the right circumstances. One obvious scenario is the case where you’re planning a project for which you need expertise and resources that you can’t find within the UK but that are available elsewhere in Europe. Another, perhaps more common example is the case where you may be able to do the development entirely within the UK but you have clear ambitions to see your product, process or system adopted across Europe. Putting together a Horizon 2020 consortium involving “exploitation partners” from elsewhere in Europe can put you on a clear track towards achieving that ambition, with some EU funding thrown in just to grease the wheels. After all, it’s not about the grant money but about developing a successful business, isn’t it?

If you would like to explore the options for getting R&D grants please contact  Alex Smeets, Cambridge Funding Solution  or visit

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