Innovate UK: government opportunities to nourish R&D investment
With the mission of empowering businesses growth and innovation, we turn our attention to the grants and funding opportunities available out there. We realise that R&D tax credits are something you can claim at the end of projects, so working back we’d like to discuss opportunities for companies at the early stages of their projects to enable the innovation process.
About Innovate UK
Established as an independent non-departmental public body in 2007, Innovate UK is part of UK Research and Innovation which serves to drive productivity and economic growth. The organisation, made up of almost 500 staff, connects businesses to partners, customers, and investors to turn concept to product or service and grow businesses. Innovate UK presents various funding available across a number of sectors in the UK market with the goal of accelerating innovation and advancing research and development investment.
In the pursuit of becoming the most innovative country in the world, the government has committed to raise R&D investment from the current 1.7% of GDP to 2.4% by 2027. In addition to R&D tax credit schemes, there are also a wide range of grants and loans available, where since its introduction Innovate UK has invested around £2.5bn to help launch new ideas. The impact on the economy has been huge: an estimated £18bn of value.
While there are many sources of funding businesses can choose from to facilitate their research and development needs, Innovate UK provides finance at earlier stages that may hold more risk, independent peer reviews of applications to support the finest ideas and a continued relationship to help keep on top of project progress.
The organisation cultivates a valuable network – the Knowledge Transfer Network – to connect cross-sector expertise, partnerships and collaboration support for companies, researchers, investors and potential customers, all in a collective attempt to propel the UKs innovative pace, bringing the best new products, processes and services to the dynamic market.
Unsurprisingly, the fund’s nature is tailored fittingly to highly innovative SMEs with strong potential for outstanding growth: representing 72% of all the businesses Innovate UK funds.
Industrial Strategy Challenge Fund
Led by UK Research and Innovate, one of programmes delivered by Innovation UK is the Industrial Strategy Challenge Fund, combining UK research and business investment to tackle four main challenges set out by the government: AI and data economy, future of mobility, clean growth and ageing society, of which are synergetic with the government’s new ten-point plan for a green industrial revolution – an effort to eliminate climate change contributions by 2050.
To read more about the Industrial Strategy Challenge Fund opportunities, take a look at the funding finder.
Innovation loans and innovation continuity loans
Piloted in 2017, innovation loans were offered through seven competitions with the purpose of aiding commercialisation, growth or scaling up of late stage projects for micro, small and medium-sized enterprises. The programme had about 100 successful applicants for which they committed £75bn, who otherwise could not access finance due to risk. While further competitions are not planned for the moment, Innovate UK is instead offering innovation continuity loans as a response to challenges continuing innovation activity presented by the COVID-19 pandemic. The organisation is offering up £210m in loans to SMEs who face shortages, unavailability of funds or further costs arising directly arising from coronavirus implications.
Applications are open up until 13th January 2021, so to find out more information on eligibility read more.
Innovate UK’s programmes also work to accelerate private funding to meet the target of 2.4% of GDP in R&D investment. The risks associated with innovation projects in young companies can present barriers for obtaining finance from private investors, rectified by deploying Innovate UK grants alongside equity funding in a single process. By combining Innovate UK’s professional experience and innovation expertise, projects selected are identified as potentially prosperous, where private funding likely follows equity funding in the business.
Partnerships and competitions
Innovate UK provide a platform to bring businesses and partners together: managing competitions on their partner’s behalf for innovation funding, facilitating relationships and continuously evaluating success of the projects.
Another scheme that the organisation offers is the Small Business Research Initiative (SBRI) which provides businesses with a potential first customer so the innovative project that they undertake is tailored, usually by a development contract so that there is opportunity to test and prove innovation before purchase. This scheme is generally not regarded as a grant, instead a subcontracting service to provide an innovative solution for a specific problem presented.
Current funding opportunities
There are a vast number of opportunities available for companies to apply to, across a variety of sectors, each with differing funds available, eligibility requirements and scopes. As opportunities are regularly updated, providing an extensive list is difficult. Innovate UK currently list 20 competitions, while UK Research and Innovation have 121 opportunities. Interestingly, since March 2020 a large number of funders came together to offer grants for ideas that address COVID-19, specifically for mitigating its effects, approaches for national recovery and transformation, understanding monitoring and controlling the transmission, diagnostics, among many others.
As we are focusing on spreading awareness about these opportunities to companies who would benefit from the funding, Novus Tax will be posting updated and ongoing information about funding opportunities on our website and social media.
A current list of live competitions can be found in various links contained in this article, but many are due to end in December 2020.