When starting a business, one of the most important things, besides an idea and a business plan, is financing. Of course, we can assume that all the funds needed for the start-up will be our own contribution. However, these days, this option is as common as buying a flat entirely for cash. Therefore, today I’d like to focus on a crucial aspect for start-ups: financing.
Which grants should you choose for your business?
Recent increases in many premiums, prices, and fees have significantly impacted business owners’ negative attitudes toward Polish legal regulations. However, contrary to the common assumptions of malcontents, the Polish state is not intent on hindering the operation of Polish businesses. On the contrary, the state values newly established and existing micro, small, medium, and large enterprises and their contribution to the national economy. Therefore, to facilitate their development, funding from the European Funds for a Modern Economy has been made available. I would like to highlight two sources I encounter in my daily work at Sailing Byte: the SMART Path and the technology loan.
Smart Path – funding for innovative businesses
The Smart Path is a subsidy available under the European Union’s FENG (European Funds for a Modern Economy) program. The Smart Path is aimed at individuals who want to base their start-up business on an innovative product, service, or technology. Furthermore, companies already in the later stages of development can also participate in the program. The total budget for the Smart Path is over €4 billion. The maximum subsidy amount for a single company is PLN 20 million. So there’s something to be said for it!
What projects have a chance of obtaining funding under the Smart Path?
The Smart Path consists of two modules within which it will be possible to obtain funding:
- R&D module, which provides funds for research and development activities
- Innovation implementation module, which provides for the provision of subsidies for the implementation of an innovative concept.
To expand on the above, let’s look at some examples:
- The development of new production methods or the use of new raw materials
- Implementation of solutions that reduce material consumption
- Development of new computer programs
- Development of improved products
Why is it worth joining the Smart Path?
Among the program’s key advantages is the fact that a single application can include financing for additional activities and investments aimed at company development. This comprehensive and innovative approach allows the obtained financing to support a company for several years of operation.
The recruitment schedule provides for the following budgets and recruitment end dates:
Projects of large companies:
- 667 mln – 12.04.2023
- 667 mln – 15.06.2023
- 890 mln – do 31.10.2023
- 445 mln (exclusively accessibility projects) – do 31.08.2023
Small and medium-sized enterprise projects:
- 4,45 mld – do 12.04.2023
- 890 mln – do 15.06.2023
- 890 mln – do 31.10.2023
- 222 mln (accessibility projects) – do 31.08.2023
The maximum level of investment subsidy is 70%, and the amount will be considered on the basis of the Regional Aid Map.
For more information about the Smart Path, please visit (PARP), i.e., the entity responsible for recruitment to the program. It’s also worth checking out the official government website regarding calls for proposals for European grants.
Technology loan – funding for micro, small and medium-sized enterprises
If you’re planning to start or already own a micro, small, or medium-sized enterprise, a technology loan is another financing option you can apply for. It’s also a benefit under the FENG Program, which aims to support businesses using innovative technology. To be eligible for a technology loan, a company must meet three main requirements:
- Conducting business in Poland (entry into the register)
- Qualification as a micro, small or medium-sized enterprise (according to EC Regulation 651/2014)
- Having creditworthiness
As with the Smart Path, the amount of funding under the technology loan is high. The estimated amount allocated for project funding under the competition is PLN 578 million. The funding available ranges from 25% to 70% and will depend on the type of expense, the size of the company, and the location of the co-financed investment. (Regional Aid Map for Poland for 2022-2027). The maximum subsidy amount for one enterprise is PLN 20 million.
What projects can be financed with a technology loan?
The provision of new or significantly improved services or goods is the main criterion taken into account when considering funding applications. An important factor is the implementation or purchase and implementation of new technology, which takes the form of:
- industrial property rights
- results of development work
- industrial research results
- technological knowledge that has not yet been patented
Why is it worth applying for a technology loan?
The criteria for granting technology loans indicate a multitude of specific expenses that may be eligible for funding. These include a number of essential but costly business investments, such as:
- acquisition of real estate ownership rights and land use rights
- production or acquisition of fixed assets
- purchase of building materials
- leasing installments
- patent costs
- protection of intellectual property rights (know-how, licenses, patents)
The timeline for applying for a technology loan assumes the submission of the appropriate application and documentation between March 23, 2023 and May 31, 2023. A detailed list of criteria, necessary documentation, deadlines, and lending banks can be found on the website of the National Economy Bank.
Other funding from European Funds for a Modern Economy
FENG also provides another type of funding – an ecological loan. As the name suggests, it is linked to projects that contribute to environmental protection. Funding will therefore include projects related to:
- Modernization of ventilation, air conditioning, cooling systems, and internal heating lines
- Modernization of lighting, heat and electricity sources or their replacement with renewable energy systems
- Thermal modernization of buildings
- Energy-efficient production processes
Detailed information on the conditions for granting the ecological loan will be announced on the website of the National Economy Bank.
How to apply for funding from European Funds for a Modern Economy?
Of course, the procedures, stipulations, conditions, and other criteria for obtaining financing under the European Funds for a Modern Economy are strictly defined. Unfortunately, for some aspiring entrepreneurs, they are also complex. Therefore, it’s advisable to seek the support of a specialist who can help with all the formalities.
Sailing Byte’s business is not based on providing documentation assistance services. However, we do work with many companies that implement projects through us under FENG funding.
Sometimes, the innovative nature of a project isn’t immediately apparent. This is especially true for those unfamiliar with FENG criteria. This doesn’t mean a given project isn’t innovative. We’re happy to help you identify the innovative elements of your ideas or business projects and define them to ensure they’re best prepared for the competition. We also have a wide network of contacts, including entities and companies who will be happy to help you finalize your funding applications. Contact us for the support and guidance you need to secure funding for your business.
However, the above is just the beginning of our offer and the path to realizing your idea. We offer our clients comprehensive and efficient project implementation, which can be financed under the Smart Path or a technology loan. Request a consultation today and discover our wide range of capabilities.
