The experience in applying for EU grants has shown that each submitted Horizon Europe proposal needs to carefully address multiple aspects; from the technical development and innovation, to market impact and implementation strategy. Nevertheless, the market impact (Impact Section) quite often has a higher value than the technology and the innovation itself (Excellence Section) when it comes to the evaluation and scoring of a Horizon Europe proposal. For example, in the former SME Instrument Phase 2, the score of the Impact Section was weighted double compared to Excellence and Implementation. This demonstrates how important is for the EC the projects to have a solid commercialization strategy.
This is mainly because a novel technology needs to have a societal, environmental, financial and/or business impact to demonstrate its value. Without this, it will just be another solution that will stay on the shelf, soon to be forgotten. This is the exact reason that European Commission, through the new Europe Horizon programme, focuses on the market and broader impact of the projects, before deciding how it will distribute the available EU funding. The EC wants to see and promote projects and ideas that will change our society.
Before getting into details of how applicants shall build up their Impact Sections, it is very important to differentiate and clarify the relations between the project objectives and the projects impacts, as well as what comes in between. The project objectives are the technological and commercial goals that each applicant is expecting to achieve during the Horizon Europe project. To achieve these goals, a number of activities will be conducted (Work Plan, Work Packages, Tasks and sub-tasks) that will lead to the pre-defined results (KPIs – Key Performance Indicators). It is these exact project KPIs that will lead to the project’s expected internal (for the applicant) and external (for the society) impacts.
The Impact Section of a Horizon Europe proposal is like a well drafted business plan
But what exactly is this Impact Section and what kind of information the applicants shall include in their proposals. The Impact is like a preliminary, but substantial, business plan of the applicant and the project. It needs to cover multiple sections to convince the evaluators for the market potential of the respective technology or idea. The commercial aspect (market) of each project is always the forefront of the Impact Section, but not only. Societal and Environmental impact are also highly significant for specific programmes. For example, in the recent Green Deal, the environmental impact of the proposed solutions is equally important.
At the end of the day, the Impact Section needs to convince EC that the budget they distribute to each project does worth the money and the effort in long-term. As mentioned above, each Horizon Europe Programme requires different level of information. Programmes where the innovation is still at a low R&D stage may require a more generic commercial approach compared to programmes that start from a higher Technological Readiness Level (TRL). Below, we will try to cover all the topics that each proposal asking for an EU Grant shall include.
How to define relevant expected impacts
Almost all programmes require a detailed analysis of the so called expected impacts of each project. This can include:
- A description of how the project will contribute to a number of fields, such as the specific impact mentioned in each work programme, scientific and/or technological progress and societal and additional environmental impacts (there is some newness in the Horizon Europe programme in this regard, explained in the next paragraphs). It is important to note that in environmental related programmes (e.g. Green Deal) there is an apparent environmental impact of each project, always in alignment with the equivalent work programme. However, it is quite common these projects to have collateral environmental impacts. Finally, demonstrating how the project will improve the innovation capacity and strengthen the competitiveness of the partners in collaborative projects is a must.
- It is crucial to know who is your customer and end-user of your solution. Adding a quantitative and qualitative section regarding the willingness of your potential customers to buy your final product/idea is important, as well as comparing your solution with the current State-of-the-art, using a cost-benefit analysis.
- Which is the main market you aim to enter and impact, along with its main segments, market trends and potential barriers? What is the current value of the market and its expected growth in the next five to 10 years? Which region/country is the current leader and which one is expecting to face the most rapid growth? All this data will consist a brief, but solid market analysis. Moreover, EC always welcomes projects that can either create new markets or re-shape the existing ones, thus providing data to justify that will always add value to your proposal.
Practical tip: Always try to link the most geographically interesting markets with the ones you aim to enter during the commercialization period of the project.
- Show the economic relevance of your solution, namely the impact it will have to your company or to all partners of the project (in case of collaborative projects). What is the revenues and profits each entity will generate as a result of the project, employment creation, market share, return on investment and any other collateral benefits.
- As EC funding is usually just the beginning for each applicant entity to start moving forward with the development and the commercialization, it is also important to elaborate on your capital investment policy for the years to follow the end of the Horizon Europe project, indicating further funding requirements, how you will achieve them and what you need them for.
- It also adds value to show to the evaluators that you have studied well the market place you aim to enter and to have foreseen potential barriers and obstacles you may face, as well as framework conditions that may endanger the project’s success. At this stage, we need to differentiate commercial barriers (e.g. potential copy of your idea from competitors or strong opposition from renown players in the market you aim to enter) with risk factors regarding implementation (the latter is usually included in the Implementation Section).
Practical tip: It is important to be specific and provide the exact information that justifies your project and its objectives. Mentioning generic impacts (e.g. how your photovoltaic technology will support the global transition from fossil fuel to renewable energy sources and fight the climate change) is good as an introduction, but it cannot stand as an argument by itself. Try to personalise each impact and use quantified targets and indicators wherever possible to show your actual differentiation from similar solutions.