Future Economy Investor Partnerships: Investor Selection 2022

Investors can apply to partner with Innovate UK to invest in innovative SMEs aligned with grant funding. This competition does not provide funding to the applicant investor: it is an investment opportunity. Grant funding will be provided to the SMEs which receive investment.

Funding Details
When

Registration Opens

04/10/2022

Registration Closes

02/11/2022

Award

This competition does not provide funding to the applicant investor, but is an investment opportunity. Innovate UK has allocated up to £80 million to fund investment-aligned innovation projects.

Organisation

Innovate UK

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Innovate UK is inviting investors to partner with us. Together we will support growth in UK micro, small and medium-sized enterprises (SMEs) by aligning Innovate UK’s grant funding for R&D projects alongside your investment.

There is no Innovate UK funding awarded to applicant investors. Grant funding will be awarded to applicant companies (SMEs) to cover a proportion of eligible project costs alongside your aligned investment. The investment will typically be in the form of equity but may include other forms of funding, like convertible loans.

We aim to create a broad “pool” of investor partners to invest in SMEs innovating across the future economy investor partnership programme and at all stages of business growth. The investor partnership programme will cover the breadth of the future economy, as described in Innovate UK’s plan for action; in particular, net zero, health and wellbeing, next generation digital technologies and the technology families.

Eligibility

We are seeking investor partners who want to invest in high growth potential micro, small and medium-sized enterprises (SMEs).

Your organisation must be an investor or be able to demonstrate that you can directly facilitate investment.

To be selected you must demonstrate that you:

  • are a credible investor, or can facilitate investment, with a clear investment strategy aligned to the Innovate UK plan for action for the future economy and have the ability to generate returns and add value to your portfolio businesses beyond financial support
  • have the capacity to invest in companies that are successful in their application to the investor partnerships programme
  • either have the capacity to follow your investment or to encourage other investors to fund further rounds of investment as and when required
  • have the capability to successfully transact investments and manage your portfolio
  • are in a position to lead the investment

This competition does not provide funding to the applicant investor.

Funding and investment amounts

Innovate UK has allocated up to £80 million to fund innovation projects, aligned with investment from investor partners, through regular rounds of the SME competition between July 2022 and July 2024. This competition does not provide funding to the applicant investor.

Potential SME applicants will be able to apply for grant funding for feasibility study, industrial research and experimental development projects:

  • feasibility studies can have eligible project costs from £50k to £300k, can last between 6 and 12 months and will have grants of up to 70%, with at least the same amount of aligned investment from or led by an investor partner
  • industrial research projects can have eligible project costs from £100k to £1m, can last between 6 and 18 months and will have grants of up to 70%, with at least the same amount of aligned investment from or led by an investor partner
  • experimental development projects can have eligible project costs from £250k to £2m, can last between 12 and 24 months and will have grants of up to 45% for micro and small businesses or up to 35% for medium sized businesses, with at least twice the amount of aligned investment from or led by an investor partner

Scope

Investor partnerships are aimed at supporting SMEs that seek support for R&D projects through Innovate UK grant funding and that also seek aligned investment from investor partners. To be an investor partner, you must demonstrate credibility, capability, capacity, commitment and alignment of interest to the scope of the investor partnerships future economy programme.

The SME projects supported by the investment must lead to new products, processes or services that are significantly ahead of others currently available or propose an innovative use of existing products, processes or services. It can also involve a new or innovative business model.

We are looking to support projects that focus on the future economy areas included in the Innovate UK plan for action. SME projects must focus on one or more of the following themes:

  • Net zero
  • Health and wellbeing
  • Next generation digital technologies
  • Innovate UK technology families ( advanced materials and manufacturing; AI, digital and advanced computing; bioinformatics and genomics; engineering biology; electronics, photonics and quantum; energy and environment technologies; robotics and smart machines)

We are particularly interested in receiving SME project applications from diverse businesses; those involving communities that are typically under-represented, including from regions that have historically accessed lower levels of investment (outside London, Oxford and Cambridge) or with, for example, female, ethnic minority and diverse-ability founders.

Investor partner applications from investors whose investment strategies include diversity as an area of focus are also encouraged.

An online briefing event will be held on Wednesday 19th October, 2-3.30pm: click here to register for a place.

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