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Horizon 2020: An Opportunity for SMEs

Horizon 2020: An Opportunity for SMEs. Wolfgang Burtscher Deputy Director-General DG Research & Innovation European Commission. Research and innovation – The main engines of future growth and jobs. Research and innovation – Crucial for solving societal challenges. +. Population. Food.

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Horizon 2020: An Opportunity for SMEs

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  1. Horizon 2020:An Opportunity for SMEs Wolfgang Burtscher Deputy Director-General DG Research & Innovation European Commission

  2. Research and innovation –The main engines of future growth and jobs

  3. Research and innovation – Crucial for solving societal challenges + Population Food +50% by 2050 +70% by 2050 + - Energy Climate +100% by 2050 +2o by 2050 - 3

  4. Share of world R&D expenditure, 1995-2010

  5. Share of total research expenditurefinanced by industry, 2010

  6. Number of triadic patent families, annual growth rates, 2000-2010

  7. 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

  8. 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 knowledge-intensive industry show a particularly strong performance in terms of productivity and employment as well as gross value added growth

  9. Europe's SMEs do not invest enoughin research and innovation • The EU has fewer young leading innovators ('yollies' = post-1975 start-ups in the R&D scoreboard) than the US • Yollies = 20% of EU leading innovators (US: >50%) • Yollies = 7% of total EU leading firm R&D expenditure (US: 35%) • And EU yollies are less R&D intensive than US yollies • 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)

  10. 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

  11. 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

  12. 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)

  13. Budget breakdown of Horizon 2020 • Excellent science: €24,418 million • Industrial leadership: €17,938 million • Societal challenges: €31,748 billion

  14. 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 • Generousfunding model • * If inter-institutional discussions on this point do not evolveanymore

  15. 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)

  16. 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

  17. Horizon 2020 New SME instrument: Scope Phase 1 Phase 3 Phase 2 ? Pre-commercial procurement Demonstration Market Replication R&D Concept & Feasibility Assessment Commercialisation SME window EU financial facilities Quality label for successful projects, access to risk finance, indirect support Demonstration, prototyping, testing , market replication, scaling up, miniaturisation, research Idea to concept, risk assessment, technological & commercial feasibility IDEA continued support throughout the project MARKET

  18. 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

  19. Thank you for your attention! Find out more: www.ec.europa.eu/research/horizon2020

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