What’s next for Innovate UK’s Smart Grants

In January this year, Innovate UK, the UK’s innovation agency, paused its Smart Grants programme. A new funding programme has been promised and is needed if the Government is to deliver its promise of economic growth and supporting some of the UK’s most exciting tech businesses.  

The Smart Grant programme has been enormously successful, designed to support small and medium-sized businesses to develop innovation with the potential to drive economic growth. Initially with a funding pot per round of £25 million and reduced to £15 million in 2024, it provided grants of between £100,000 and £500,000.

The Smart Grant programme attracted a large number of applications with a success rate of around just three or four per cent. Whilst disappointing, it was perhaps no great surprise that the Smart Grant programme was paused.

And it is a pause. Innovate UK has recently closed a consultation where it asked businesses and their advisers for ideas on what its replacement might look like. Innovate UK has promised a pilot of a new funding scheme in the Spring of this year. 

We currently do not know what this pilot will look like, who will qualify for grants, or how it will shape any future funding programme. But we do know it was a valued grant programme that has helped early-stage technology businesses accelerate their growth plans. 

Going for growth

One of the Labour government’s primary missions is to deliver economic growth. The tech sector – whether green tech or AI, health tech and quantum computing – is a cornerstone for that growth.

To achieve that, there needs to be an environment where funding eligible businesses is readily available. There needs to be a clear roadmap from Innovate UK of the funding that is available to businesses at every stage of their journey.

That roadmap must include clearer eligibility criteria. It takes a business time and resource, often with help from their accountants, to prepare grant applications – time and money that is wasted when less than four per cent of applications succeed. A simplification of the subsequent reporting requirements would also be helpful. 

We will keep a close eye on the Innovate Smart Grants programme, its imminent pilot and its eventual replacement.

Our dedicated Funding team is placed to help businesses of all sizes explore the wide range of funding options available to high-growth businesses. Contact us for more information.