How to increase your chances of getting grant funding

Government grant income helps sustain your business until sales revenue comes in.  Getting a grant can help companies:

• De-risk your business for investors.

• Provide credibility and validation (the grant review process is rigorous).

• Enable founders to retain as much equity as possible.

• Enable founders to maintain full control and decision-making.

• Help with access to specialised resources.

• Serve as a catalyst for future investment.

• Improve publicity and visibility.

However, many early-stage businesses focus on raising money too early, before they have real evidence like customer insights. It is therefore important to focus on a validated problem and talking to customers early before thinking about a grant.

Where can I get a grant?

Grants are available from multiple sources. UK government sources appropriate for climate tech companies include Innovate UK, Ofgem Strategic Fund and BEIS. A grant support provider can potentially increase your chances of getting a grant and save you time, or you can apply for one yourself, with fully funded support available from government organisations.

What kind of grant should I apply for?

When applying for a grant it's important that your grant project is in scope. When applying for a grant with Innovate UK, it is advisable to adopt a stepped strategy. This means applying for a small grant project first, before attempting to apply for a Smart grant. Smart grants are highly competitive and the success rate is low, but you can increase your chances of getting one, if you can show that you can already manage a grant project first.

Who can help me get a grant?

There are a number of organisations that can help you get a grant. It all depends on the stage your company is at, whether you would prefer to pay for help and the type of grant you'd like. Here are a few organisations that can help you get a grant:

Innovate UK Business Growth

Innovate UK Business Growth provides fully funded coaching and mentoring for innovative climate tech companies that usually have a prototype and Minimum Viable Product (MVP). Support is provided in the following areas:

• Identifying suitable grants to apply for.

• Reviewing your grant application and checking you have answered the questions correctly.

• Help to get investor funding, including pitch opportunities.

• Reviewing your business model.

• Reviewing your strategy.

• Help to internationalise, including Global Explorer grants and match making events.

• Referrals to other government agencies.

• Answering questions about any aspect of your business.

  
  

Companies need to have progressed, with sales of around £100,000, or have funding or finance of this amount already. Climate tech companies also need to commercialise within around 18 months (although there will be exceptions).

Innovate UK Business Connect

Similarly, Innovate UK Business Connect exists to help businesses navigate Innovate UK’s funding landscape. Innovate UK Business Connect helps businesses that are not as advanced as those that Innovate UK Business Growth supports and has sector experts.

• The organisation connects companies with appropriate funding opportunities and competitions, including Innovate UK grants, innovation loans and other government-backed support.

• Guidance is offered in identifying the right grant pathways and improving applications (including a Good Applications Guide).

• Connections can be made between founders and collaborators or partners, which is useful for grants that require consortia or industrial partnerships.

• Businesses can also be introduced to investor networks or programmes that complement grant funding (like the Growth Catalyst investor-grant hybrid).

  
  

The organisation steers founders toward the right competitions and helps them build better applications, making it easier to win Innovate UK funding. However, Innovate UK Business Growth and Business Connect cannot guarantee a grant will be awarded.

The Catapult Network

The Catapults are sector-focused innovation centres designed to help companies scale and commercialise technology and they play an important supporting role in the grant ecosystem:

• They provide expert technical and commercial advice, facilities and validation environments that can make grant proposals stronger.

• They can help businesses identify suitable funding routes and sometimes partner on projects that are funded by Innovate UK grants.

• In some cases Catapult-related voucher or small grant schemes (e.g., RTO/Catapult vouchers) exist. These are smaller grants tied to engagement with a Catapult or R&D organisation.

• Catapults are not typically themselves grant-funding bodies in the way Innovate UK competitions are. Their primary strength is in de-risking R&D, supporting technical development and helping companies prepare highly competitive grant applications.

• Catapults that may be relevant for climate tech companies are the Energy Systems Catapult, Connected Places Catapult, Digital Catapult, High Value Manufacturing Catapult, Offshore Renewable Energy Catapult and the Compound Semiconductor Catapult.

Investment Partnerships

Innovate UK’s Investor Partnerships have been helping SME innovators secure private capital for high-potential SMEs since 2017. They are a blended finance mechanism consisting of a grant and investment, helping attract 11 times more investment. They also help catalyse follow on investment.

Investor Partnerships provide up to £900k per company to support late-stage R&D and commercialisation, aligned with private investment from an Innovate UK Investor Partner. This competition is for SMEs that can demonstrate the potential to grow and scale and must also have a project that is aligned to the following UK’s Modern Industrial Strategy (Invest 2035) key sectors and technologies.

You must establish a relationship and a strong level of investment traction with one of the approved investor partners before you apply for funding. The investor partner must have submitted an expression of interest directly to Innovate UK and confirmed with you that you are in a position to apply for grant funding as you will be asked to identify them in the application. Without an EOI submitted by your named Investor Partner, your application will be viewed as ineligible.

The government agencies listed above can help you apply for an Investor Partnership.

Growth Hubs

Growth Hubs are run by regional Local Enterprise Partnerships (LEPs) and can help founders identify a plethora of grants. Growth Hubs provide a localised service and typically help businesses find grants for growth, innovation, sustainability and job creation, often providing funding for capital investment (equipment, tech) or specific projects, rather than general running costs like wages or rent. The Growth Hubs can help you reduce emissions by providing capital for green energy projects. This could also help save costs and make you look more attractive to corporates (reducing their Scope 3 emissions).

Business Support Service

The Business Support Service run by the Department for Business and Trade can also offer information about grants.

The service covers the whole country and can also help with:

• starting a business.

• running and growing a business

• selling overseas from the UK

• investing and expanding in the UK

Private grant support companies

There are several grant writing service and support companies in the UK that can help with grant writing, funding strategy, bid preparation and related services. The payment structure is either fixed fees, project-based pricing, or a hybrid of a reduced upfront fee plus a 'success fee' (a percentage of the secured grant). Given time is money, working with a grant service provider can help save you a significant amount of time. Grant support providers include:

• Ayming UK – Consultancy including innovation funding strategy and support for R&D grants.

• BAM Innovation – Specialist grant writers for innovation funding (Innovate UK, EIC, NIHR etc.).

• Grant Start Ltd – Bespoke grant proposal writing and strategy for UK & European innovation funding (Innovate UK/ Horizon).

• Grant Thornton - provides independent professional services firms, ranking among the world's largest, offering assurance (audit), tax and advisory services.

• GrantUp – Focuses on Innovate UK Smart Grants and EIC Accelerator support.

• RedKnight: Innovation Funding Made Easy – Supports innovation funding and grant applications for SMEs.

• Ryan (formally Granted) - speeds up the process of identifying the right grant opportunities.

• Tatton Consulting – Specialist in Innovate UK, NIHR, SBRI and other innovation/R&D grants.