Given that the Smart Grants scheme is one of the most popular in the UK, it isn’t surprising that people have questions about - about every aspect of it, in fact!
To answer these questions, I’ve decided to start a series of articles that will each cover one aspect of the subject of Smart Grants statistics. I will keep these articles updated as new rounds of Smart Grants come out, and eventually do a round-up, or create a summary page putting everything together.
How many applications get funded
Without further ado, let’s dive into one such item of data: the number of applications that successfully win the grant. The first thing to say about this number is that it doesn’t necessarily represent the number of companies that actually get money from TSB. In a meeting with David Bott some time ago, he mentioned that about 50% of grant winners end up claiming their money, and sadly this matches with our observations. There are far too many applicants who don’t understand how match funding works, and who apply when they have no way to actually make use of the grants. Perhaps the main reason why we end up turning away potential grant-writing clients is because they have no money: hardly an auspicious beginning for a match-funded grant.
Anyway, the statistics are as follows, broken down by round and grant type:
|Proof of Market||Proof of Concept||Development of Prototype||Total|
Large numbers? Not here
The first thing to note about these statistics is that the number of grants is far from huge. Apart from a couple of bumper rounds at the very beginning when 100-150 projects received funding approval, every round after that has funded, on average, about 20 grants in each category. That’s it. Remember, too, that those are divided amongst quite a few focus areas. So if you’re in one area (e.g. Digital), you can probably expect that a handful of projects in your area will get funded.
This makes TSB’s Smart Grants scheme incredibly competitive. We have noticed this in our own filings. Even a rock-solid grant application from a great company with a brilliant team and a clear use for the money will not necessarily win. This is why we tell our clients that although we know we can increase their chances, we can certainly not guarantee a win. Smart Grants are a bit of a lottery, because of how competitive they are.
With so few applicants receiving funding in each round, this also means that luck plays a large part. The grant is competitive, so if you happen to apply in the same round as some exceptionally good candidates, you might lose just because of the competition, when you might have won in another round.
The other thing that is obvious at first glance is that the first two rounds were incredibly lopsided, and were followed by an incredibly meagre round in September 2011, after which the number of successful projects has slowly crept up. Is that because fewer people applied? You’ll find out the detailed answer in a later article (be sure to follow this blog or sign up to the newsletter!) but the short answer is “no”. The number of applicants has been more or less consistent across rounds, particularly in the high-value PoC and DoP grant schemes.
This is hardly a surprise. In fact, it was covered by the Telegraph in November 2011:
A spokesman for the TSB said: “We are managing a scheme covering more territory than the previous one, with a lower budget, operating it in the interests of business as best we can given the austere times.
“We had to front load the [approvals] to ensure that we helped as many businesses as we could with the funding available in this financial year. It will settle at a consistent level but there will be a need to slow the [spending] down.” She added that rejected companies can apply twice more for funding.
No surprise that small businesses (and grant writers!) have been somewhat upset about this.
Importantly, now that time has passed since the Telegraph article, we can note that although the number of successful applications has slowly increased over time, it has not increased by all that much. Whoever filed in the first two rounds got away with an incredibly easy application process which is unlikely to ever return. Smart Grants are going to be hyper-competitive every round, from now on, it seems.
Equal focus on each scheme
The third thing we can see is that the focus is more or less equal on each scheme. There is no apparent benefit in applying for one scheme instead of another, so applicants are well advised to apply for whichever scheme fits them best.
There is, looking at the averages, a slightly increased chance of getting funded as a PoC, but that is actually a distortion from the first couple of rounds. If you ignore these, then the difference between grant schemes is much smaller, and the DoP scheme is actually the one that funds most projects on average.
The conclusion is really what we’ve been telling people about Smart Grants all along: Smart Grants are a bonus - if you get them, great, but don’t count on them. They are very competitive, therefore very risky. Even a great application is not guaranteed to win. Therefore, make sure you plan accordingly.
In other words, assume you won’t get the grant, and develop your company as if the grant scheme didn’t exist. If you do then obtain the grant, it will come as a great surprise - but if you don’t, as is also quite likely, it won’t hurt you much.