Key Takeaways from the EIC Accelerator Deep Tech Report (SME Instrument Phase 2)

The European Innovation Council (EIC) has published The Deep Tech Europe Report: key numbers from the EIC performance (PDF) which summarizes key impact figures and statistics with respect to the EIC Accelerators performance. The EIC Accelerator blended financing program (formerly SME Instrument Phase 2, grant and equity financing) has been active since 2019 and relevant statistics on the equity investments are expected to guide the programmes reshaping throughout Horizon Europe (2021-2027).

The analysis found in this document is not only useful for prospect Small- and Medium-Sized Enterprises (SME) but also for professional writers and consultants who seek to improve their knowledge on the EIC Accelerator and the EU's future ambitions in general. The detailed information given discusses topics that are valuable and are not generally part of the official work programme or the annotated proposal template such as the selected industries, business models, size of companies and their financing history.

The following is a summary of key takeaways and perspectives on the EIC Accelerator Deep Tech Report:

EIC Budget: Horizon Europe vs. Horizon 2020

The EIC pilot budget will increase from €3bn under Horizon 2020 (2018-2020 - 3 year period) to €10bn for Horizon Europe (2021-2027 - 7 year period). This means that the budget will increase from an average of €1bn a year to €1.42bn per year (a 42% increase).

Key Performance Indicators (KPI)

Funded projects were matched by private post-project investments with €3.3 (2015) to €2.9 (2016) for each €1 invested by the EIC in 2015 and 2016.

Female Participation

15% of the beneficiaries for blended finance calls (since June 2019) have had female CEO's. During the Green Deal deadline in May 2020, this number rose to 34% through the dedicated efforts by the European Commission (EC) to increase the share of women funded by the EIC Accelerator (i.e. gender must now be selected on the Funding and Tenders (F&T) platform - read: Official Proposal Template Updates). Without the Green Deal cut-off, the rate of female CEO's would have been at only 8% of all beneficiaries.

Valuation

5% of the former startups and Small- and Medium-Sized Enterprises (SME) in the EIC's portfolio are currently valued above €100m.

Applications and Success Rates

With 9,700 applications in a single year, success rates have dropped to 2-3% on average whereas success rates of 1% and potentially lower have likewise been observed due to the coronavirus pandemic (COVID-19), the strongly advertised Green Deal call (read: The Green Deal) and the generally increased appeal of the grant to startups.

Out of all applications, 2,537 companies have received the Seal of Excellence (SOE) which means that these SME's have received a score above 13 (read: The EIC Accelerator Score).

Evaluators and Jury Members

2,400 evaluation experts (i.e. for the written application in step 1) and 100 jury members (i.e. for the pitch week interview in step 2 - read: Pitch Deck) have been imperative to selecting the successful applications and assuring high-quality EIC Accelerator awards (read: EIC Accelerator Financing Timeline). The gender of the jury members has been well-balanced with the aim of having fairer results and gender equality whereas 51% of members were male and 49% were female.

While the step 1 evaluators are of varying backgrounds, the jury members have a strong investor-oriented background with 27% being innovation and industry specialists, 24% being venture capitalists, 22% being serial entrepreneurs and 19% being business angels.

Geographic Analysis

The top EIC Accelerator (SME Instrument Phase 2) companies by country have been Spain (930), Italy (701), the United Kingdom (UK - 459), Germany (377) and France (343) whereas associated countries such as Tunisia (0), Anguilla (2), Greenland (1), Armenia (1) and Gibraltar (0) were less represented.

Size of the SME's

Judging by the numbers of employees, there has been a strong trend towards micro (1-9 employees) and small businesses (10-49) which are making up 97% of all applicants at equal shares whereas medium-sized businesses (50-249) only made up 3%. This is underlined by the share of medium-sized companies dropping gradually from 12% in 2014 to 3% in 2020.

Age of SME's

When separating the funded EIC Accelerator companies into their founding dates, a trend towards preferring young SME's has been observed whereas the share of over 10-year-old companies has dropped from 32% in 2014 to only 9% in 2020. In the same time frame, the youngest startups with an age below 5 years have grown from 47% to 63%. This underlines the interest of the European Union (EU) to encourage breakthrough innovation and reach short time-to-markets.

Selected Industries

From an industry perspective, the top-funded EIC Accelerator projects were representative of the Health (1,262), Energy (922), IT software (735), Transportation (424) and Food industries (396).

Target Customers

From a business model perspective, 77% of companies followed a Business-to-Business (B2B) approach while only 23% were targeting end-users through Business-to-Consumer (B2C) products.

Blended Financing (Grant with Equity Option)

For all awarded blended financing applicants in 2019 and 2020 (4 total cut-offs and 140 winners), the overall budget was €278m in grant financing and €583m in equity with €6.5m being the average financing amount.

EIC Accelerator Follow-Up Investments

EIC Accelerator-awarded companies have attracted a total of €5.3bn in follow-up funding through private investments or similar channels (i.e. equity, debt, Mergers & Acquisitions, Initial Public Offerings - IPO's).

Equity investments made up a total of €4bn (74%) of the financing in subsequent Series A, growth equity or similar funding founds. Most of the investments were stemming from European sources (69%) whereas 22% were raised from the United States and 4% from Chinese investors.

Successful Exits of EIC Accelerator Companies

Initial Public Offerings (IPO) and acquisitions were the most common exits for EIC Accelerator-awarded companies with 17 and 43 in total, respectively, since 2015. Valuations of the top 10 companies were ranging from €200m to €700m with the annual growth being as high as 40%.

These tips are not only useful for European startups, professional writers, consultants and Small and Medium-Sized Enterprises (SME) but are generally recommended when writing a business plan or investor documents.

Deadlines: Post-Horizon 2020, the EIC Accelerator accepts Step 1 submissions now while the deadlines for the full applications (Step 2) under Horizon Europe are listed below. The Step 1 applications must be submitted weeks in advance of Step 2. The next EIC Accelerator cut-off for Step 2 (full proposal) can be found here. After Brexit, UK companies can still apply to the EIC Accelerator under Horizon Europe albeit with non-dilutive grant applications only - thereby excluding equity-financing. Switzerland has resumed its participation in Horizon Europe and is now eligible for the EIC Accelerator.

Contact: You can reach out to us via this contact form to work with a professional consultant.

AI Grant Writer: ChatEIC is a fully automated EIC Accelerator grant proposal writer: Get it here.

Eureka Network: The Eureka Network delivers various international collaborative R&D initiatives such as Network Projects, Clusters, Eurostars, Globalstars, and Innowwide, providing funding from €50K to €6.75M per project based on the specific initiative. This network emphasizes market-driven innovation and deep-tech advancement across multiple technology sectors including ICT/Digital, Industrial/Manufacturing, Bio/Medical Technologies, Energy/Environment, Quantum, AI, and Circular Economy. Eligible participants include SMEs, large enterprises, research organizations, universities, and startups, with Eurostars particularly focused on R&D-performing SMEs. Get Started

EIC Transition: EIC Transition delivers up to €2.5 million in funding to overcome the 'valley of death' gap between laboratory research and market deployment, emphasizing technology maturation and validation. The initiative supports single legal entities or small consortia of 2-5 partners including SMEs, start-ups, spin-offs, and research organizations. Key technology domains include Health/Medical Technologies, Green/Environmental Innovation, Digital/Microelectronics, Quantum Technologies, and AI/Robotics. Get Started

EIC STEP Scale-Up: EIC STEP Scale-Up delivers significant equity investments of €10-30 million for established deep-tech companies prepared for hyper-growth and large-scale expansion. The initiative targets SMEs or small mid-caps with up to 499 employees who have obtained pre-commitment from qualified investors. Primary focus areas include Digital & Deep Tech (Semiconductors, AI, Quantum), Clean Technologies for Net-Zero objectives, and Biotechnologies. Get Started

EIC Pre-Accelerator: EIC Pre-Accelerator represents a 2025 pilot initiative delivering €300,000-€500,000 in funding for early-stage deep-tech development and preparation for the EIC Accelerator program. This program is exclusively accessible to single SMEs or small mid-caps from 'Widening countries' to foster regional innovation development. The initiative encompasses deep-tech innovations across physical, biological, and digital domains. Get Started

EIC Pathfinder: EIC Pathfinder delivers up to €3 million for Open calls and up to €4 million for Challenge-based calls to support early-stage research and development with proof-of-principle validation. The initiative requires research consortia with a minimum of 3 partners from 3 different countries, including universities, research organizations, and SMEs. Primary technology focus areas include Health/Medical, Quantum Technologies, AI, Environmental/Energy, and Advanced Materials. Get Started

EIC Accelerator: EIC Accelerator delivers flexible funding options including blended finance (€2.5M grant + €0.5M-€10M equity), grant-only (up to €2.5M), or equity-only arrangements for scale-up and market deployment of breakthrough innovations. The initiative targets SMEs, start-ups, and small mid-caps with up to 499 employees, with MedTech/Healthcare representing 35% of funded projects. Additional technology areas include Biopharma, Energy, AI, Quantum, Aerospace, Advanced Materials, and Semiconductors. Get Started

Innovation Partnership: Innovation Partnership enables collaborative innovation between public and private sectors with typical funding of €1-5 million per project. The initiative supports cross-sectoral strategic technologies through public-private partnerships and consortia. Projects concentrate on addressing societal challenges through collaborative innovation approaches. Get Started

Innovation Fund: The EU Innovation Fund delivers substantial funding of €7.5 million to €300 million for large-scale demonstration of innovative low-carbon technologies. The initiative targets clean energy, carbon capture, renewable energy, and energy storage technologies to accelerate the transition to a low-carbon economy. Eligible participants include large companies, consortia, and public entities capable of implementing large-scale demonstration projects. Get Started

Innovate UK: Innovate UK delivers various programs with funding ranging from £25K to £10M depending on the specific initiative, supporting business-led innovation, collaborative R&D, and knowledge transfer. The organization funds projects across all sectors with particular emphasis on emerging technologies and supports UK-based businesses, research organizations, and universities. Programs are designed to drive economic growth through innovation and technology commercialization. Get Started

Industrial Partnership: Industrial Partnership delivers €2-10 million in funding for industrial research and innovation partnerships focusing on manufacturing, industrial technologies, and digital transformation. The initiative supports industrial consortia and research organizations in developing collaborative solutions for industrial challenges. Projects aim to strengthen European industrial competitiveness through strategic partnerships. Get Started

Eurostars: Eurostars represents a joint EU-Eureka initiative delivering €50K-€500K for international R&D collaboration specifically led by SMEs. The program adopts a bottom-up approach, accepting projects from all technology fields without predefined thematic restrictions. R&D-performing SMEs must lead the consortium and demonstrate significant R&D activities. Get Started

LIFE Programme: The LIFE Programme delivers €1-10 million in funding for environmental protection, climate action, and nature conservation projects across the European Union. The initiative supports environmental technologies, climate adaptation strategies, and biodiversity conservation initiatives. Eligible participants include public authorities, private companies, NGOs, and research institutions working on environmental and climate challenges. Get Started

Neotec: Neotec represents a Spanish initiative delivering €250K-€1M in funding for technology-based business creation and development, supporting the growth of innovative Spanish SMEs and start-ups. The program covers all technology sectors and aims to strengthen Spain's technology ecosystem. Funding is specifically targeted at Spanish technology-based SMEs and start-ups to enhance their competitiveness and market presence. Get Started

Thematic Priorities: EU Thematic Priorities encompass various programs aligned with EU strategic priorities including green transition, digital transformation, health, and security initiatives. Funding amounts vary based on the specific program and call requirements, with projects designed to address key European challenges. Applicant eligibility varies by specific program and call, with different requirements for different thematic areas. Get Started

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