Securing a large innovation grant is one of eight company events that we see as signifiers that a company is about to grow, or is already growing, at an impressive rate. Innovation grants can provide companies with the financial means to undertake research and development projects , helping them to expand their business down the line. In this post, we outline how large innovation grant funding has fared over the past eight years and profile the top five Innovate UK grantees in 2019 so far.
Understanding large innovation grants
The Beauhurst platform has comprehensive coverage on grants awarded by Innovate UK, Scottish Enterprise, the Development Bank of Wales and Invest Northern Ireland. We also track grants made to UK companies under the EU’s H2020 and FP7 programmes. Innovate UK is a public body which provides the majority of grants in the UK’s high-growth ecosystem. These grants are intended to drive business investment in research and development and support UK businesses in accelerating innovation.
Not all companies who receive grants are tracked – only those that meet the following criteria:
- They have received a grant of at least £100k where the awarding body is UK-based or €100k+ where the awarding body is the European Union
- They use the grant for a specific innovation project. The project’s focus must foster ‘new-to-the-market’ innovation, rather than other aims like job creation
- They receive the £100k+ (or €100k+) grant for a single project. Companies who receive multiple grants totalling £100k, but which are not used for a single project, are not tracked.
Large innovation grants from 2011-2019
The number of large Innovate UK grants issued has decreased over the past 3 years. 732 grants have been awarded in 2019 so far. This appears on track to fall just below the 918 grants made in 2018, which also fell short of the 1,059 grants issued in 2017. Whilst the number of grants have been decreasing, the value of grants have been increasing over the past four years, until 2019. The £453m in grants issued so far in 2019 will likely fall well below the £761m issued in 2018. Thus, with both the number and value of grants likely hitting a three year low in 2019, it is clear that grant funding has hit a snag. If this trend continues, companies must look beyond grant contributions to finance their innovative projects.
Sectors and buzzwords
69% of companies that have received large innovation grants since 2011 are operating within the Technology and IP sector. Breaking this down further, the most popular buzzwords of recipient companies are artificial intelligence (AI), Internet of Things, Big data, eHealth and Robotics. It is unsurprising that AI remains the premier buzzword of grant recipient companies, in light of the government’s AI Sector Deal as part of the Industrial Strategy.
2019’s top 5 recipients of Innovate UK grants
1. Gridserve Sustainable Energy: £4.86M
Gridserve Sustainable Energy is a sustainable energy company which develops solar energy storage solutions. Gridserve’s technology has three main applications: grid power, providing grid services to support distribution network operators; electrical vehicle power, providing charging points for electric vehicles; and remote power, which provides critical power to the telecoms industry.
Gridserve was founded in September 2017 and received a grant of £4.86m in September 2019 from Innovate UK – the largest Innovate UK grant in 2019 so far. This grant was awarded as part of the ‘Demonstrator for UK’s First Solar Electric Forecourt’ project. This project predominantly aims to address the lack of electric vehicle charging points around the UK, which is preventing widespread adoption of electric vehicles. Innovate UK is hoping the grant can help Gridserve facilitate a UK-wide rollout of community charging hubs, at prices that are competitive to home charging. The project is due to end in February 2021.
2. Agrimetrics: £3.02M
Agrimetrics was formed in June 2015 and is an agritech company which provides data to agrifood businesses, collection services and policy-makers to help them deliver food sustainably. Agrimetrics’ platform utilises machine learning and satellite imagery. It mainly provides data which quantifies important aspects of livestock and crop production, such as soil, weather and water. This data is used by agrifood businesses and stakeholders to develop insights about trends in the food and supply chain and make predictions about food production.
Agrimetrics’ main source of funding is derived from grants – having secured five grants with a total value of £17.3m. Agrimetrics’ received its most recent grant in April 2019 by Innovate UK, as part of the ‘Agrimetrics Ltd’ project. Agrimetrics received £3.02m, with the project due to end in March 2020. With the project summary not yet released publicly, this grant is expected to help fund the business’ data collection processes and expansion.
3. Bruntingthorpe: £2.7M
Bruntingthorpe has been in existence since 1955 and operates a 670 acre site upon which a range of services are offered. These services include automotive and aerospace testing, corporate track days, product launches and military testing. Bruntingthorpe Proving Ground is where vehicle testing and development is held, with companies able to test prototypes and innovative R&D projects. The ground boasts features such as a 3.2km straight track and a 6.5km asphalt circuit.
Bruntinghthorpe has met several of our high-growth triggers in recent years. It recently featured in the London Stock Exchange Group’s 1000 Companies to Inspire Britain list, and is also classified as a scaleup. The company received a £2.7m grant in June 2019 from Innovate UK as part of the ‘Highway Intersections Upgrade to Bruntingthorpe Proving Ground’ project. This project aims to provide a comprehensive set of highway intersections at Bruntingthorpe Proving Ground to mimic a wide variety of UK road junctions. This is designed to enable autonomous vehicles to be tested in a realistic, safe and secure way. The new track will be designed by Idiada Automotive Technology, with the project ending May 31, 2021.
4. Akaza Bioscience: £2.67M
Akaza Bioscience was formed in May 2018 and develops novel therapies for patients who suffer from Acute-on-Chronic Liver Failure (ACLF). ACLF is usually caused by injury to the liver and Akaza has developed ‘Resatorvid,’ a therapeutic approach designed to help these patients. Akaza has achieved great financial success in 2019, raising £4.6m in equity to a tune of a £2.26m pre-money valuation. Akaza has also received a £2.67m grant from Innovate UK as part of their ‘Proof of Concept clinical trial for Akaza Biosciences’ Resatorvid’ project. Innovate UK has recognised that Resatorvid presents a promising treatment for ACLF patients and thus the grant is issued to enable Resatorvid to be put through a phase 2 clinical proof of concept trial. Success of this trial would lead to registration and eventual market availability in 2022. The project will finish in March 2021.
5. Factory 42: £2.05m
Factory 42 is an immersive content production studio founded in June 2016. Factory 42 operates the studio to create interactive stories and documentaries using VR and AR technology, resulting in unique, multi-sensory experiences for broadcasters, brands, destinations and artists. Factory 42 have worked with high-profile brands such as Sky, Google, the BBC and Magic Leap, as well as winning awards including the Broadcast Digital Awards 2018. They have also been featured in two high-growth lists in 2019: Startups 100 2019 and the 2019 Createch Ones to Watch.
Factory42 received a £2.05m grant from Innovate UK for the ‘Dinosaurs & Robots’ project, which is operating from January 2019 until December 2020. This grant was issued for Factory 42 to create an immersive museum experience aimed at bringing dinosaurs and robots to life. To design this, Factory 42 will be working with the Natural History Museum and Science Museum Group. This project was initiated to try and overcome the difficulties faced by museums in generating engagement with its audiences – particularly students and young children.