Early stage financing (VFF)
Early stage financing offers SMEs and start-ups the opportunity to investigate whether their innovation has an opportunity in the market for future investors.
What is Early Phase Financing?
The Early Phase Financing, also known as VFF for short, is intended for start-ups and SMEs to investigate whether their innovative idea has a chance of moving from a planning phase into a start-up phase. It is therefore an ideal way to find out whether you have an interesting and promising project in your hands. For example, you can use the money you receive through early-stage financing to show your future investors that your idea is indeed as good as you hoped. However, this is not a subsidy, but a loan. You take out this loan with the Netherlands Enterprise Agency (RVO) and NWO Domain Applied and Engineering Sciences (TTW). You also pay interest on this loan. This has been set at 4.69% on 1 January 202, but can be adjusted by the European Commission. Early stage financing has three target groups, namely:
Innovative starters (active for less than 5 years)
Academic / HBO / TO2 starters. These are affiliated with a university, college or university hospital
The RVO takes care of the SME entrepreneurs and innovative starters and the TTW takes care of this third group of starters
Budget Early phase financing
The budget of the Early Phase Financing also has the division as mentioned above. A combined budget of € 8 million applies to SME entrepreneurs and innovative start-ups, and a separate budget of € 2.4 million applies to academic, HBO and TO2 start-ups. The individual amount of the loan is at least € 50,000 for all three groups. The maximum is € 157,000 for SME entrepreneurs, 350,000 for innovative start-ups and € 250,000 for academic start-ups.
Conditions of the Early Phase Financing
To qualify for the VFF, there are a number of conditions, the three most important conditions are:
You draw up a business plan that shows that you will grow substantially
You draw up an early phase plan or renewal plan in which the conditional requirements of the future investor are clearly expressed
You have a letter of intent from the future investor that declares that meeting the requirements will result in an investment. The loan cannot exceed the amount promised by this investor
Applications for the Early Phase Financing
You can apply for the VFF all year round, so there is no hard deadline to meet. However, there is a limited budget and if this runs out during the year, it is therefore no longer possible to receive financing via the VFF. Applications for the Early Phase Financing are processed in chronological order and have a decision period of up to 13 weeks. In these 13 weeks, the VFF advisory committee will check whether you meet the above requirements. You apply for the loan at the RVO if you are an SME entrepreneur or innovative starter and at the TTW if you are an academic starter. In both cases MK can help you to submit this application as correctly and completely as possible. This gives you a higher chance of success and you can start researching your idea in the market with your company.