100% funded innovation grants – the start of something new?

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Following several pilot schemes over the past few years Innovate UK, the government’s innovation agency has launched a public-private partnership funding programme. Here we look at what they are and what they mean for business innovation funding going forward.

What are public-private funding schemes?

Public-private funding schemes, as the name suggests, combine public grant funding with private investment. Partnering the two leverages the expertise of the grant provider in identifying suitable innovation projects and the expertise of the private investor to identify companies that would benefit the most from investment.

How do they differ from conventional grants?

Grants for businesses typically fund between 10% to 70% of eligible project costs and require the applicant to source the remaining funds themselves. The new public-private funding schemes offer 50% grant funding and 50% investor funding, effectively reducing the need for businesses to find their own funding.

What are the benefits for business users?

Aside from the more obvious 100% funding, businesses that secure both grants and private investment are more likely to outperform businesses that only secure a grant or private investment, according to an article published by Beauhurst in 2017.

What schemes are available?

There are currently 5 public-private funding schemes launched by Innovate UK and their investor partners:

• The Ageing Society Grand Challenge Mission – Barclays Ventures
• The Ageing Society Grand Challenge Mission – Legal & General
• The Ageing Society Grand Challenge Mission – Northstar Ventures
• UK Clean Growth Innovation Fund – Engie
• Plastics Innovation and Investment Fund – Sky Ocean Ventures