Enterprise Ireland (EI) has teamed up with the Government to launch a number of new incentives to help Irish start-ups and Small and Medium Enterprises (SMEs), obtain funding to the Covid-19 health emergency. The various incentives are detailed below.
1. FINANCIAL PLANNING GRANT
Purpose of the Grant:
For companies to develop a robust financial plan which will help businesses prepare applications for external finance from banks and/or other providers (including EI investments).
How does it help?
- Provides 100% funding for access to financial consultants- which typically cost up to €5,000.
- Develops framework to survive and sustain businesses.
- Identifies costs and gaps in funding.
- Helps understand immediate liquidity issues.
Who can apply?
- EI’s clients, and clients of IDA and Údarás na Gaeltachta,
- Domestically focused non-EI clients who are manufacturing and/or internationally traded services that employ 10 or more full time employees.
2. SUSTAINING ENTERPRISE FUNDS
Purpose of the Fund:
To ensure companies have access to liquidity in the short term to sustain their business during the pandemic.
How does it help?
- Provides a repayable advance of up to €800,000.
- There is an annual administration fee of 4%.
- Funding to be repaid as follows;
- 3 year grace period,
- Repayment by end of year 5 on successful achievement of project objective.
Who can apply?
Eligible companies:
- must employ 10 or more employees;
- operate in manufacturing and internationally traded services sectors;
- have previously applied for funding with an appropriate financial institution;
- have seen (or expect to see) a 15% or greater reduction in actual or projected turnover or profit as a result of COVID 19.
Eligible companies must submit a Business Sustainment Plan with their application identifying the company’s immediate liquidity needs, evidence of their application to a financial institution and identifying how the support provided will help their business.
Who can’t apply:
- Companies that were in financial difficulty on 31st December 2019 within the meaning of General Block Exemption Regulation (that is, a company subject to insolvency proceedings or which fulfils the criteria for winding up at the request of its creditors), or companies which were in financial difficulty after 31st December 2019 for non COVID 19 related reasons;
- Companies active in primary agriculture, fishing or aquaculture sector or operate in coal and steel sector;
- Companies covered by specific rules for financial services.
3. SUSTAINING ENTERPRISE GRANT FOR SMALL BUSINESSES
Purpose of the Grant:
As part of the above Sustaining Enterprise Fund, EI is offering a specific grant for small businesses so that they can sustain their business and recover from the financial repercussions of COVID 19.
How it helps:
- Provides financial support for a 3-month period.
- The Grant will provide eligible companies with a short-term capital injection of between €25,000 – €50,000 to enable them to sustain business continuity and ensure that they are in a strong trading position in the future.
Who can apply?
- Companies with more than 10 employees (as of 29th February 2020) and an annual turnover of less than €1.5million can apply for funding up to €25,000.
- Companies with an annual turnover of between €1.5million and €5million can apply for funding up to €50,000.
- Applicants must have suffered, or expect to suffer, a 15% or greater reduction in actual or projected turnover or profit as a result of COVID 19.
- Applicants must have engaged with their financial institution detailing the finance needed to sustain the business through the short and medium term.
Who can’t apply?
- Companies which were in financial difficulty on 31st December 2019 within the meaning of General Block Exemption Regulation or companies which were in financial difficulty after 31st December 2019 for non COVID 19 related reasons.
- Companies active in primary agriculture, fishing or aquaculture sector or operate in coal and steel sector
- Companies covered by specific rules for financial services.
4. EI INNOVATIVE HPSU FUND
High growth potential start-ups (HPSUs) are companies that, in the view of Enterprise Ireland, can develop innovative technologies, products and services for sale on world markets.
Purpose of the Fund:
EI developed the fund to support the set up and development of HPSUs. It offers equity investment on a co-funded basis and is similar to a venture capital approach. EI appreciates that HPSUs carry a risk of technical or industrial failure and shares that risk with the company and its investors.
How it helps?
- EI will assess the business plan and supporting evidence based on certain criteria, such as the level of risk, growth potential, potential value to the Irish economy.
- If EI decides to invest, they will partner with other investors in an investment round and may commit a maximum of 50% of the investment required.
Who can apply?
Small enterprises who are EI clients in existence for less than 5 years and satisfy one or more of the following criteria:
- For companies who are not trading, at least 15% of the total revenue costs must relate to research and development expenses in the current fiscal year,
- For companies who are trading, at least 15% of the total revenue costs must relate to research and development expenses in at least one of the preceding three years,
- Must have an innovative business plan for the development of products, services or processes which are technically new or substantially improved when compared with the industry in the European Community, and which will carry a risk of technological or industrial failure.
If you wish to discuss the potential effects on the corporate structure of your company in entering into any of the above schemes, please contact Katie Oakes at koakes@lavellepartners.ie, Gríana O’Kelly at gokelly@lavellpartners.ie or call 01 644 5800.
