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SME Instrument – how to avoid failure?

success failure SMEs H2020

The SME Instrument under the Horizon 2020 has since its launch in 2014 attracted more than 10.000 individual applications, but only 12% of them are good enough to be considered for funding.

Why are 88% of applicants failing?
In most cases the answer is pretty simple. Although applicants have fantastic ideas, they are below par in terms of commercialising and bringing the innovations to the market and consumers. Meaning that they do not fulfil the most important criteria in the evaluation, namely the commercialisation criteria. What is more, European inventions have a track record of being commercialised in Japan, US or in countries, and the SME Instrument was meant to be a tool to reverse this trend.

Failure is part of journey
Resubmitted proposals are at least twice as successful as applications being submitted for the first time, so failure is part of journey to success. Many of the rejected proposals come from university spin-offs with little in-house business expertise. And since proposals are often being evaluated by investment and venture capital experts, the applicants should structure their proposal as a business plan that is investor-ready.

How to succeed
Hence with the SME Instrument, the European Commission wish to support entrepreneurs that bring ideas to the market and reward them for their courage. The SME’s are being judged on their ability to bring a product to the market and to present a sufficiently ambitious development strategy considering the market, competitors and potential customers, i.e. the commercialisation potential of the product.

If you want to learn more about H2020 check our posts here and here
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