Cascade Funding
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Cascade Funding

Cascade funding, or also known as Third Party Financial Support, is a mechanism of the European Commission to distribute smaller amounts of public funds in a more agile way, in order to support specific aspects such as the incorporation of new technologies, promotion of start-ups, promotion of pioneering sectors, etc.

The main objective of this funding method is to simplify administrative procedures with applicant entities, mostly SMEs and start-ups, thus allowing some EU-funded projects to issue, in turn, open calls for further funding. In other words, cascade funding is a simplified public funding opportunity designed to facilitate a greater capillarity of EC funds and actions, facilitating the participation of SMEs and start-ups, since for them participating in a European project means dealing with a large amount of bureaucracy.

How does cascade funding help SMEs and Start Ups?

This mechanism offers start-ups and micro-SMEs funds ranging from 50,000 to 150,000 euros; and offers them the possibility of establishing relationships and being able to work side by side with other companies (many of them industries of great weight and importance at European level), technology centres and universities. To participate, no prior guarantee or collateral is required; the evaluation times are shorter, as is the bureaucratic and administrative management itself, and the reporting is simpler since it is based in most cases on work performance.

Cascade funding are grants that are managed and paid by the beneficiaries of the European project that supports them. This means that funding decisions are no longer the responsibility of the European Commission, but of the project leaders or coordinators. They are the ones who open the calls for proposals to attract potential beneficiaries, in particular start-ups and SMEs.

Regarding the sectors that can benefit, the vast majority of these cascade grants cover digital areas, particularly around Industry 4.0, data, embedded systems, but they are also being extended to blockchain or energy saving technologies. However, funding can be allocated to different types of specific activities, from studies, to experiments, pilots, developments, etc.

Reviewing some legal aspects, in cascade funding projects the Intellectual Property Rights of what is developed in each cascade funded project is owned by the applicants of the cascade funding grant, not by the partners generating the cascade funding call.

Some cascade funding programmes are currently open. In Horizon Europe, new cascade funding opportunities are expected to open up. At ZABALA Innovation we organise and manage several of these open calls. Currently, we open new cascade funding opportunities beyond the regular calls through 5 programmes, each with their own open calls for funding and/or services targeted at small scale enterprises and local authorities.

These programmes are initiatives that foster entrepreneurship and start-ups across Europe in different sectors, with a preponderance of ICT applied to different vertical sectors such as Industry, Energy, Big Data, Logistics, Environment, Health, Media, Smart Cities, etc.

800M€

in cascade funding from H2020

6

open calls from Zabala Innovation

200,000€

non-refundable funding

Advantages

  • 1. Calls

    Horizon 2020 allocated almost 800 million euros in cascade funding calls.

  • 2. SMEs and start-ups

    Mainly aimed at SMEs and start-ups, these calls provide financing that ranges from 50,000€ to 200,000€, non-refundable.

  • 3. Participate

    Unlike other procedures of European funding programmes, it is easier to participate.

  • 4. Successful proposal

    Since these calls are less known, the chances of submitting a successful proposal increase.

  • 5. Innovative ecosystem

    It is the gateway to the European innovative ecosystem.

Blanca Rodríguez

“All companies seeking financing and looking to go one step further to launch or consolidate products and services in the market can find an opportunity here. The European Commission relies on experts to manage funds from third parties to reach the end user with greater efficiency and impact.”

Blanca Rodríguez

European Projects Manager

FAQ

  • Are Cascade Funding opportunities 100% funded?

    Some of them are, but it depends on the specific call.

  • Will Cascade Funding replace the SME Instrument?

    No. Cascade funding opportunities are a completely separate and unrelated funding mechanism to SME Instrument calls.

  • Why cascade funding?

    Being an innovative start-up, SME or mid-cap company often means facing a number of budgetary challenges that will need to be addressed. Seeking funding through European calls for proposals is the next step, but the process of finding partners and submitting a proposal, in the hope that it will be approved, can be challenging for some. In most cases, direct Horizon 2020 calls might not even be able to fund companies in the way they would like.

    This is where cascade funding comes in. Horizon 2020 allocated almost 800 million euros in cascade funding calls. In practice, this means that instead of going directly to the source, which in this case is Horizon 2020, start-ups and SME owners can seek funding as a third party through an open call for an ongoing project.

    Support is usually given in the form of funding, complemented by technical assistance from industry experts who can support applicants in both proposal preparation and project implementation. These calls, which mainly target SMEs and start-ups, provide funding ranging from 50,000€ to 150,000€ in the form of non-equity funding.

    As the calls here are less known than the usual calls, the chances of successful proposals increase and open the door to the European innovation ecosystem.

Programs

European Commission

Horizon Europe

ec.europa.eu

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