Horizon 2020:
An Opportunity for SMEs
Wolfgang Burtscher
Deputy Director-General
DG Research & Innovation
European Commission
Research and
Innovation
Research and innovation –
The main engines of future growth and jobs
Policy
Research and
Innovation
Research and innovation – Crucial for solving societal challenges
+
Population
Food
+50% by 2050
+70% by 2050
+
Energy
Climate
+2o by 2050
+100% by 2050
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3
Policy
Research and
Innovation
Share of world R&D expenditure, 1995-2010
100
11.4%
13.9%
ROW
90
28.7%
22.3%
80
EU
70
60
31.7%
37.9%
50
US
40
30
32.1%
20
22.1%
ASIA-5
10
0
1995
(CN+JP+KR+SG+TW)
1996
1997
1998
1999
2000
2001
2002
Policy
Research and
Innovation
2003
2004
2005
2006
2007
2008
2009
2010
Share of total research expenditure
financed by industry, 2010
Policy
Research and
Innovation
Number of triadic patent families, annual
growth rates, 2000-2010
Policy
Research and
Innovation
Europe needs a proactive SME policy
• SMEs constitute the backbone of the European
economy. In 2011/12:
• SMEs accounted for 99.8% of all non-financial
enterprises (20.7 million firms)
• SMEs accounted for 67.4% of total non-financial
employment (87.5 million persons)
• SMEs accounted for 58.1% of non-financial gross value
added (€3.6 trillion)
• But Europe's SMEs are under pressure:
• SMEs in the EU as a whole continue to struggle to
recover to pre-crisis levels of value added and
employment
Policy
Research and
Innovation
Research and innovation underpin SME
competitiveness
• In the EU, there are almost 46,000 SMEs in high-tech
manufacturing (HTM) and more than 4.3 million SMEs offering
knowledge-intensive services (KIS), together accounting for
21.1% of all SMEs.
• These include SMEs producing pharmaceutical products,
electronics or legal and accounting services as well as scientific
R&D and creative industries.
• => SMEs active in the so-called 'hi-tech' and knowledgeintensive industry show a particularly strong performance
in terms of productivity and employment as well as gross
value added growth
Policy
Research and
Innovation
Europe's SMEs do not invest enough
in research and innovation
•
The EU has fewer young leading innovators ('yollies' = post-1975 start-ups in
the R&D scoreboard) than the US
•
•
•
And EU yollies are less R&D intensive than US yollies
•
•
Yollies = 20% of EU leading innovators (US: >50%)
Yollies = 7% of total EU leading firm R&D expenditure (US: 35%)
R&D to sales ratio of 4.4 (US: 10.2)
This is because the EU has fewer yollies in young, high R&D-intensity sectors
(biotechnology, internet, etc)
Policy
Research and
Innovation
SMEs under FP7
15% of the funding of the 'Cooperation' specific programme
reserved for SMEs
SMEs now (2/2013) already account for 16.3% (=€3.4bn) of
the funding of the 'Cooperation' specific programme
They accounted for 14% by 12/2010
They accounted for >20% in 2011 and 2012 (even though the
annual budgets increased rapidly)
By the end of FP7, total funding for SMEs will probably amount
to about €6bn
Policy
Research and
Innovation
What is Horizon 2020?
• Commission proposal for a €80 billion research and
innovation funding programme (2014-2020)
• Core part of 'Europe 2020', 'Innovation Union' and
'European Research Area'
Responding to the economic crisis to invest in future jobs and growth
Addressing people's concerns about their livelihoods, safety and environment
Strengthening the EU's global position in research, innovation and technology
Policy
Research and
Innovation
What is new?
• A single programme bringing together three separate
programmes/initiatives*
• Coupling research to innovation – from research to retail,
all forms of innovation
• Focus on societal challenges facing EU society, e.g.
health, clean energy and transport
• Simplified access, for all companies, universities,
institutes in all EU countries and beyond
•
*FP7, innovation aspects of the Competitiveness and Innovation Framework Programme (CIP); EU
contribution to the European Institute of Innovation and Technology (EIT)
Policy
Research and
Innovation
Budget breakdown of Horizon 2020
• Excellent science: €24,418 million
• Industrial leadership: €17,938 million
• Societal challenges: €31,748 billion
Policy
Research and
Innovation
What is in it for SMEs?
• 20%* of the combined (1) 'leadership in enabling and industrial
technologies' (part of 'industrial leadership' pillar) + (2) 'societal
challenges' pillar budgets reserved for SMEs
• Simplified access for all is of particular benefit for SMEs
• Instruments that are:
Completely dedicated to SMEs:
New SME instrument; Eurostars 2; Innovation in SMEs
Strongly focused on SMEs:
Access to risk finance
More SME-friendly than regular collaborative research:
Joint Technology Initiatives
Regular collaborative research
• Generous funding model
•
* If inter-institutional discussions on this point do not evolve anymore
Policy
Research and
Innovation
Simplification
• A single set of simple, coherent participation rules for all types
of beneficiaries and activities consisting in particular of a single
funding rate (maximum of 100% of the total eligible costs) and
a flate rate for indirect eligible costs (20% of direct eligible
costs)
• Broader acceptance of participants' accounting practices for
direct costs
• Reduction of time-to-grant
• A new balance between trust and control (e.g. reduced number
of audit certificates)
Policy
Research and
Innovation
New SME instrument: Strategic positioning
Horizon 2020
Collaborative
Research
Target: R&D
topics
Horizon 2020
Eurostars
Target: R&D
intensive SME
Horizon 2020
SME instrument
Target: Business
innovation motivated
SMEs
Market
opportunity
driven
projects
R&D
driven
projects
Policy
Research and
Innovation
Horizon 2020
New SME instrument: Scope
?
Phase 1
Concept &
Feasibility
Assessment
Idea to concept,
risk assessment,
technological &
commercial feasibility
IDEA
Phase 2
Demonstration
Market Replication
R&D
Phase 3
Pre-commercial
procurement
Commercialisation
Demonstration,
prototyping, testing ,
market replication, scaling
up, miniaturisation,
research
continued support throughout the project
Policy
Research and
Innovation
SME window EU
financial facilities
Quality label for
successful projects,
access to risk
finance, indirect
support
MARKET
New SME instrument: Main features
•
Targeted at all types of innovative SMEs showing a strong ambition to
grow (and to develop and internationalise)
•
Only SMEs allowed to apply for funding (single company support, but
collaboration is certainly advisable)
•
Competitive, EU dimension  only the best ideas pass phase I
•
Market-oriented, close-to-market activities: 70% funding
•
3-phased and coaching
•
Entrance in both Phase 1 and 2
•
Embedded in societal challenges and key enabling technologies
Policy
Research and
Innovation
Thank you for
your attention!
Find out more:
www.ec.europa.eu/research/horizon2020
Research and
Innovation