The landscape of innovation grants, funding and tax credits can be overwhelming. We explore how companies can make the most of the funding options available to them.
With a host of new innovation funds being made available across a number of sectors and HMRC committing to accelerating payments of research and development (R&D) tax credits, all the building blocks of funding innovation success are available. However, navigating through the choice on offer needs careful consideration.
Are you adopting a holistic approach to your innovation funding?
There are many options for government funding available, domestically and internationally, for retrospective and prospective projects and for a wide range of activities. The key is to take a holistic approach to ensure your innovation is optimally funded and supported. Passive management of your funding options can result in missed funding opportunities. One situation we see all too often is great projects which have been undertaken without prior consideration of available funding. This can have an adverse impact on the return on investment of projects, or worse, discourage a company from continuing its innovation journey.
What steps need to be taken to ensure your innovation receives optimal funding?
It all starts with good planning as well as integrating and researching funding options into the project outline. This affords the opportunity to work with government and local authorities to understand what prospective funding is available, and what objectives the project would need to achieve for the best chance at funding success. In conjunction with this, it is advisable to understand what retrospective funding is available, such as R&D tax credits and how this interacts with any prospective funding. Once this has been mapped, you can then optimise your overall funding position and apply for the most lucrative and relevant funding options available to you.
What other factors do you need to consider?
Whilst government funding comes without the hefty price tag of equity, it is not effortless. Prospective funding tends to be based on merit and eligibility, so whilst a project may be eligible for funding, it may not be the most worthy and highest scoring applicant and therefore may be unsuccessful in securing funds. The required effort and subsequent milestone reporting is not therefore without time commitment and risk. The ability to provide evidence and contemporaneous recordkeeping of activities is also important to ensure compliance and expedient payment of funding.
How do you practically achieve this?
The starting point in getting the approach to innovation funding right is to embed its importance in the internal culture of the business. The most successful businesses we see in this sphere celebrate the importance of government funding and what it helps them to achieve. This approach helps ensure that government funding considerations are intrinsically part of project planning and management. This instils an approach and attitude towards funding resulting in optimised claims, well managed cashflows, due to timely milestone reporting and resources to spare for the next innovative endeavour.