Including SME Instrument Phase 1

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SME Participation in Horizon 2020

• Including SME Instrument Phase 1

• DG Research and Innovation, Unit B.3
• SMEs, Financial Instruments and State Aid
• _at_ NCP Training
• October 7, 2014

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Horizon 2020 for SMEs
20 budgetary target in LEITs (IL) SC
'Innovation in SMEs' (IL)
'Access to Risk Finance' (IL)
MSCA (ES)
EUR 9 billion of direct SME support. over
the period 2014-2020
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Horizon 2020 Global View SME participation in
the 3 Pillars (excl. 'Innovation in SMEs'
'Access to Risk Finance')

• An Encouraging Start

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An Encouraging Start!

• 9 months into Horizon implementation. SMEs
  represent
• 1/4 of applicants (24.82)
• 1/5 of beneficiaries (19.55)
• 1/6 of budget allocation (16.18)
• What about the target (set by Council and EP) to
  allocate 20 of the budget for Societal
  Challenges and LEITs to SMEs?
• For Societal Challenges. we are at close to 12
  (11.98)
• For LEITs. we are at about 21.4 (21.46)
• For both together we are currently at 18.12
• This while the full impact of SME instrument
  funding has not kicked in yet (no phase 2 yet)
• On the basis of an extrapolation taking into
  account the full impact of SME instrument phase
  2, it can be assumed that the target will be
  exceeded by 2-3 for 2014-2015

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SMEs in Excellent Science A Mixed Bag

• Two sections out of four with high relevance for
  SME participation
• Future and Emerging Technologies (FETs)
• Marie-Sklodowska-Curie Actions (MSCA)
• For FETs suboptimal results, given relative
  attractiveness of the topics for SMEs (esp.
  start-ups)
• 7.4 of all applicants are SMEs
• 4.2 of all beneficiaries are SMEs
• 5.4 of the budget goes to SMEs
• 12.09 of SME applicants are successful (vs.
  20.96 of all applicants)
• For MSCA first information confirms that SMEs
  have found their way to this scheme
• 11.76 of applicants are SMEs
• 13.77 of beneficiaries are SMEs (// close to 15
  in FP7)
• 10.31 of the budget goes to SMEs (// close to
  11 in FP7)
• 19.27 of SME applicants are successful (vs.
  16.45 of all applicants)

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SMEs in Excellent Science applicants and budget

  SME applicants in the selection SME applicants in the selection SME applicants in the selection Requested EU financial contribution to SME applicants in selection Requested EU financial contribution to SME applicants in selection Requested EU financial contribution to SME applicants in selection
Priority Area Eligible Proposals Retained Proposals Success Rates Eligible Proposals (in million EUR) Retained Proposals (in million EUR) Success Rates
European Research Council 2 0 0.00 0.21   0.00
FETs 91 11 12.09 344.13 1.91 5.55
MSCA 1308 252 19.27 317.87 48.16 15.15
Research infrastructures 0 0        
 Total Excellent Science 1401 263 19 352.5 50.07 14
As available in CORDA on 25/9/2014
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SMEs in LEITs Clear Chemistry

• Most interest (in absolute terms) for
• Information and Communication Technologies (ICT)
  4198 SME applicants 29.84 of total
• Advanced Manufacturing and Processing (AMP)
  1336 SME applicants 30.72 of total
• Nanotechnologies. Advanced Materials and
  Production (NMP) 692 SME applicants 44.85 of
  total
• Space (SP) 639 SME applicants 25.58 of total
• Biotechnology (Biotech) 74 SME applicants 100
  of total
• Overall, reassuring figures for all LEITs
• 30.65 of all applicants are SMEs
• 25.29 of all beneficiaries are SMEs
• About 1/9 of SME applicants are successful (vs.
  13.38 of all applicants)
• 234.2 million EUR of the 1.092 billion EUR
  (21.46) allocated so far went to SMEs

Only SME instrument (phase 1)
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SMEs in LEITs applicants and budget figures
  SME applicants in the selection SME applicants in the selection SME applicants in the selection Requested EU financial contribution to SME applicants in selection Requested EU financial contribution to SME applicants in selection Requested EU financial contribution to SME applicants in selection of budget allocated to SMEs
Priority Area Eligible Proposals Retained Proposals Success Rates Eligible Proposals (in million EUR) Retained Proposals (in million EUR) Success Rates of budget allocated to SMEs
ICT 4198 429 10.22 1188.27 130.54 10.99 19.48
NMP 692 58 8.38 164.38 22.11 13.45 30.86
Biotech 74 3 4.05 3.7 0.15 4.05 100
AMP 1336 165 12.35 476.26 58.19 12.22 25.58
Space 639 111 17.37 149.69 23.23 15.52 19.47
Advanced Materials 0 0
 Total LEITs 6941 766 11.04 1982.3 234.23 11.82 21.46
As available in CORDA on 25/9/2014
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SMEs in SC More Highs than Lows

• Most interest (in absolute terms) for
• Health, Demographic Change and Wellbeing 1163
  SME applicants 22.1 of total SC1
• Secure, Clean and Efficient Energy 959 SME
  applicants 30.92 of total SC3
• Climate Action, Environment, Resource Efficiency
  and Raw Materials 665 SME applicants 31.49 of
  total SC5
• Smart, Green and Integrated Transport 342 SME
  applicants 48.24 of total SC4
• Inclusive, Innovative and Reflective Societies
  226 SME applicants 16.78 of total SC6
• Food Security, Sustainable Agriculture and
  Forestry, Marine, Maritime and Inland Water
  Research 190 SME applicants 100 of total
  SC2
• Secure Societies 47 SME applicants 100 of
  total SC7
• Overall. OK. yet budget going to SMEs should be
  increased (what will happen in any case with SME
  instrument phase 2)
• 28.04 of all applicants are SMEs
• 19.57 of all beneficiaries are SMEs
• About 1/10 of SME applicants are successful (vs.
  14 of all applicants)
• 71.4 million EUR of the 595.7 million EUR
  (11.98) allocated so far went to SMEs

Only SME Instrument (Phase 1)
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SMEs in SC - applicants and budget
  SME applicants in the selection SME applicants in the selection SME applicants in the selection Requested EU financial contribution to SME applicants in selection Requested EU financial contribution to SME applicants in selection Requested EU financial contribution to SME applicants in selection of budget allocated to SMEs
Priority Area Eligible Proposals Retained Proposals Success Rates Eligible Proposals (in million EUR) Retained Proposals (in million EUR) Success Rates of budget allocated to SMEs
SC1 1163 116 9.97 371.22 29.7 8.00 12.17
SC2 173 10 5.78 8.65 0.5 5.78 100
SC3 959 63 6.57 231.69 15.32 6.61 8.33
SC4 342 40 11.7 31.37 3.88 12.36 16.61
SC5 665 85 12.78 137.03 16.88 12.32 14.87
SC6 226 24 10.62 56.60 4.83 8.54 16.03
SC7 47 6 12.77 2.05 0.3 14.63 100
 Total SC 3575 344 9.6 838.61 71.42 9 11.98
As available in CORDA on 25/9/2014
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Horizon 2020 for SMEs Integrated
Complimentary Support
20 budgetary target in LEITs (IL) SC
'Innovation in SMEs' (IL)
'Access to Risk Finance' (IL)
MSCA (ES)
EUR 9 billion of direct SME support, over
the period 2014-2020
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Implementation

• Implemented centrally by one agency (EASME)
• Continuously open call with around 4 cut-off
  dates per year

2014 2014 2015 2015
Phase 1 18/06/2014 24/09/2014 17/12/2014 Phase 2 09/10/2014 17/12/2014   Phase 1 18/03/2015 17/06/2015 17/09/2015 16/12/2015 Phase 2 18/03/2015 17/06/2015 17/09/2015 16/12/2015
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2 budget
10 budget
88 budget
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• 1st Cut-off date 18 June 2014
• 2662 proposals
• 2503 single company applications. 119 consortia
  with 2 SMEs. 34 with 3 SMEs. 6 with 4 SMEs
• Italy was the country with the highest number of
  proposals submitted (436), closely followed by
  Spain (420), UK (232) and Germany (188), France
  (167) and Hungary (166)
• The Open Disruptive Innovation (ODI) topic
  attracted by far the highest number of
  applications with 885. followed by low carbon
  energy systems (372). nanotechnologies (305) and
  eco-innovation/raw materials (241)
• 2nd Cut-off date 24 September 2014
• 1944 proposals
• The ranking by country remains the same as in
  June. with Italy in the lead in terms of number
  of applications (351). followed by Spain (283),
  United Kingdom (149), Germany (128), France (93)
  and Hungary (91)
• Open Disruptive Innovation (ODI) attracted again
  the biggest number of proposals (608), also
  followed by low carbon energy systems (268),
  nanotechnologies (234) and eco-innovation/raw
  materials (199)
• No further information yet on applicants

SME Instrument Phase 1 - Submission
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only countries with submissions are shown
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Number of proposals submitted by topic for the 2
cut-off dates

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SME Instrument Phase 1 Evaluation / Funding
after First Cut-Off Date

• Out of the 2602 eligible applications received,
  317 (12) were evaluated above threshold.
• The budget available for this cut-off would allow
  to fund 169 companies (Phase 1 project). Based on
  the positively evaluated applications per topic
  155 projects could be funded (6).
• 49 of applications above threshold will be
  funded ? every second "good" proposal is funded.
• 105 out of 155 (68) of the SMEs reportedly are
  newcomers to Framework Programmes.
• Countries with highest success rate are Ireland
  (20), Austria (15), UK (11), Israel (10) and
  Spain (9)
• Company statistics
• 58 of funded SMEs have between 6 to 50
  employees, 30 of SMEs micro-companies with up to
  5 employees, and 11 have more than 50 employees.
• 25 of funded SMEs are consolidated companies
  with more than 11 trading years, 39 with 4 to 10
  years, and 36 with up to 36.
• 36 of funded SMEs have a turnover higher than
  1M, 35 between 100K-1M, 28 less than 100K.

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(No Transcript)
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The 5 highest "country success rates"
are Ireland 20 Austria 15 United Kingdom
11 Israel 10 Spain 9
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Analysis of received and selected proposals per
topic 1st Cut-off
Topic Proposals evaluated Max. project fundable Proposals above positively evaluated "Success rate" above threshold and funded
ICT 37 Open Disruptive Innovation Scheme   886 30 107 12 28
NMP 25 Accelerating the uptake of nanotechnologies, advanced materials or advanced manufacturing and processing technologies by SMEs   310 152 29 9 59
BIOTECH 5 SME boosting biotechnology-based industrial processes driving competitiveness and sustainability 74 3 8 11 38
LEIT Space-SME   61 4 4 7 100
PHC12 Clinical research for the validation of biomarkers and/or diagnostic medical devices 208 44 (20) 24 12 100
Fairly high number of proposals above threshold
High number of ineligible or wrongly submitted
proposals 66
Fewer than possible projects positively evaluated
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Analysis of received and selected proposals per
topic 1st Cut-off
Topic Proposals evaluated Max. project fundable Proposals above positively evaluated "Success rate" above threshold
SFS8 Resource-efficient eco-innovative food production and processing   BG12 Blue Growth  125     48 7     3 29 6 23 12 24 50
SIE 1 Stimulating the innovation potential of SMEs for a low carbon and efficient energy system   374     221 46 12 50
IT.1 Small business innovation research for Transport 227 242 26 12 100
SC-5-20 Boosting the potential of small businesses for eco-innovation and a sustainable supply of raw materials   248 111 32 13 38
DRS17-Protection of urban soft targets and urban critical infrastructures 41 6 6 15 100
Many proposals above threshold
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First analysis of reasons for unsuccessful phase
1 proposals

• Too much project focussed, not enough business
  opportunity oriented
• Description of company not convincing (why would
  this company succeed and not the competitor?!)
• No information on competing solutions
• Innovation content too low product exists
  already on the market (just incremental
  improvement)
• Just ideas, no proof of existing
  commercialisation concept (TRL far too low)
• Just trying one's luck

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Lessons learned and aspects for improvement

• Submission process not yet optimal (85 of the
  submitted proposals arrived within the last 48h
  prior to the cut-off date).
• Presentation of the call at proposal submission
  level is not yet optimal (70 proposals had to be
  transferred from one topic to another upon
  request by the applicants, with the majority of
  the cases due to misinterpretation of the
  applicant).
• Level of feedback from evaluation to applicants
  will be improved, yet speed (short time-to-grant)
  will remain the most important preoccupation.
• Pool of evaluators will be broadened from current
  521 to about 1000 (more business, financial
  profiles!)

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Your reaction, feedback based on your contacts
with stakeholders? Are there any specific
issues that need to be better explained/clarified
to potential proposers? Questions?