The EIC Accelerator: To Disrupt or Not to Disrupt
This article presents a perspective on how a project for the EIC Accelerator funding (grant and equity, with blended financing option) by the European Commission (EC) and European Innovation Council (EIC) can be shaped. The EIC Accelerator awards up to €2.5 million in grant and €15 million in equity financing per project (€17.5 million total) and is designed for Small- and Medium-Sized Enterprises (SME) and startups, often supported by freelancers, professional writers or consultants.
Risk and Disruption
The EIC Accelerator is aiming to fund disruptive innovations with a high risk profile, often from a scientific or DeepTech space.
In reality, high-risk projects are less attractive to the EIC jury as is seen in select companies being downgraded from blended financing to the grant-first EIC Accelerator mode due to their high risk which is a sign that most funded projects have a medium risk profile at best (see 2022 Success).
Similarly, funding disruptive innovation makes for good marketing for the EIC but, in reality, disruptive technologies are generally ambitious and unproven in the market, two criteria the EIC jury will negatively assess.
An example is Tesla which has extensive proof of market traction in terms of vehicle sales and charging infrastructures but it has yet to prove its Robotaxi technology.
Still, if Tesla were to realize its vision for Robotaxis and could successfully implement it at scale, it would be truly disruptive. But without proof of success, the EIC jury would likely avoid investing in such a disruptive innovation by itself since it prefers lower-risk propositions as do most other investors.
To Be or Not to Be Ambitious
True disruptive innovations emerge out of unforeseen areas and are extremely difficult to predict. Even Jeff Bezos, founder and ex-CEO of Amazon, candidly said in a CNBC interview right before the DotCom crash in 2000 that they could fail and that their success is not guaranteed:
"Long-term, I believe, that it's very easy to predict that there are going to be lots of successful companies born of the Internet. They're going to have very large market caps and so on. I also believe that today where we sit it's very hard to predict who those companies are going to be. So you know you can make bets on these things and I think that Amazon.com, if we don't if we're not one of those important lasting companies born of the Internet, we will have nobody to blame but ourselves and we will be extremely disappointed in ourselves. But there are no guarantees. It's very very hard to predict."
Clearly, it worked out well for Amazon but it was a very risky proposition. The core problem with disruption is that the more certainty an investor wants to have, the less disruption they will end up looking for. An investor wants to see validation and proof because they are looking for a Return on their Investment (ROI).
Disruptive innovation generally lacks such proof since it has not disrupted anything yet. The danger of investing in truly disruptive innovation can be seen in Cathie Wood's Ark Invest since the high level of volatility and risk can have severe downsides in times of uncertainty.
Aiming to predict true disruption can lead to swings between genius picks and severe gambling losses.
Disruptive innovation has a chicken-and-egg problem where it is often only attractive for funding after it has been funded or succeeded.
In the same way, the EIC’s Step 3 jury prefers already proven and validated commercial strategies over truly disruptive innovation since it is the safer bet. This is why an extremely well-funded company can obtain an EIC Accelerator grant two weeks after it raised $25+ million from private investors (see Breaking the Rules).
This is not the advertised mission of the EIC but it is what any smart investor would do so one cannot blame the EIC. If the EIC funds 80% safe technology projects and 20% high-risk innovations then it is still a great win for the European innovation ecosystem.
Reality Check
If the mission of the EIC sounds too good to be true…
“The EIC Accelerator focuses in particular on innovations, building on scientific discovery or technological breakthroughs (‘deep tech’) and where significant funding is needed over a long timeframe before returns can be generated (‘patient capital’). Such innovations often struggle to attract financing because the risks and time period involved are too high. Funding and support from the EIC Accelerator is designed to enable such innovators to attract the full investment amounts needed for scale up in a shorter timeframe.“
…it probably is.
Based on experience, any company that is unable to obtain financing outside of the EIC Accelerator has a low chance of being successful in the EIC Accelerator program.
For an EIC Accelerator application, companies should make sure that extensive validation of both the technology and especially the business model has taken place. While Step 1 and Step 2 of the evaluation process will heavily focus on the innovation and technology aspects, the Step 3 interviews will show a strong preference for financial and commercial validation.
If a revenue stream is unproven, customer interest is uncertain or the market is newly created then the jury will likely not be interested in funding this project.
A good rule of thumb for the EIC Accelerator is to have a complicated and innovative technology but a clear, proven and simple commercial strategy. While the Step 3 jury will have a high tolerance for uncertainty when it comes to technology developments, it has a strong aversion to uncertainty when it comes to commercial strategies.
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.
EIC Accelerator Step 1 Deadline 2025
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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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