Grant Funding: Startup’s Secret Weapon in 2024

A downward global trend in investment sparks concern for startups. Grantify explores why grant funding will become more important than ever in 2024.

Megan Williams
February 6, 2024

A downward trend in investment across the globe is sparking concern for startups hoping to grow throughout 2024. Could grant funding be the answer? Grantify explores why grant funding looks set to become more important than ever in the next 12 months.

The Global Investment Picture

Venture capital funding has dropped in almost every market, particularly since the Covid-19 pandemic. Factor in rising interest rates, the collapse of Silicon Valley Bank, and geopolitical instability, and you can understand what may lead investors to be more cautious than of late.

A report by London-based venture capital group Atomico found that around $45bn was raised by European tech companies in 2023, down from $82bn last year.

But the State of European Tech report also confirms that this is far from a European trend:

The market reset is not solely a European concern. The projected volume of total investment in 2023 is expected to equal less than half of the investment seen in the peak year of 2021 across every global region. There has been a notably consistent reduction in global private tech investment not only in Europe, but also in the US, China, and beyond.

Deloitte’s research in the US market concurs, reporting that following four straight years of $30+ billion of venture debt, 2023 saw that figure plummet to just $12 billion.

Resetting the Market?

It’s not all doom and gloom. Some analysts have interpreted these figures as a necessary cooling down of inflated valuations and investments, in favour of more strategic decisions.

It’s also a more positive picture for early stage companies, who appear to have weathered the storms more effectively.

Atomico partner and head of intelligence Tom Wehmeier is reported in the Financial Times to note that while larger deals have declined, early stage deals remain competitive, and their valuations more resilient:

The degree of competitive intensity at seed has stayed strong.

Understanding the changing investment landscape is a key priority for Grantify and the startups we work with.

There’s no doubt that raising equity investment right now is challenging, and we’re advising our clients not to if they can avoid it. But how can they stay afloat and bridge the gap?

This is where grant funding comes in. If you’ve never considered it before, now is the time.

Why Grant Funding?

Grants are a form of cash investment in your business.

For most government-backed grants, you don’t have to pay the money back or give up any equity. You may also be surprised at the amount of grant funding on offer – some grants offer up to six figure sums, making them a powerful tool for growth.

There are lots of different grant funding streams you could apply to, particularly for tech startups. Both the US and UK governments seek to support innovative projects with the potential to solve some of our biggest problems by developing new healthcare technologies, improving public services, regenerating our natural environments and more.

A grant can help you get your business up and running, and prepare you for the rough and tumble of venture capital, once you’re ready.

Applying for Grant Funding

Although the benefits of grants are clear, winning one isn’t a stroll in the park.

There are dozens of available grants, all with differing eligibility requirements, processes and deadlines.

Once you’ve found a grant you can apply for, you may find it takes several months to put together everything an application for funding needs, including a business plan, financial projections, market research, detailed costings, team and contractor bios, agreements in principles from potential customers – and often more!

Even with all of this in place, you may not be successful. It’s hugely discouraging to spend months of your precious time on an application that gets rejected at the first hurdle.

For the best chances of winning a game-changing grant, you’ll need expert support.

Insider Tips Guide to Winning Grants

We’ve helped hundreds of businesses win millions in grant funding.

Here are a few of our key tips for grant success:

  • Art and Science: Crafting a compelling application involves a careful blend of art and science. Build a powerful narrative around your idea, right from the start of the grant application process.
  • Technical Challenge: Ensure your idea is not just great, but also technically challenging. Grant applications seek innovations that are difficult and groundbreaking.
  • Justify Public Funds: Why does your project deserve public money? Detail wider impacts, including economic, social, and environmental aspects.
  • Commercial Viability: Prove the commercial viability of your business, including ambitious yet realistic numbers. Showcase how you will grow and scale your business.
  • Team Talent: Emphasise the expertise of your team, tailoring their backgrounds to the technical and commercial challenges.

Ready for Takeoff in 2024?

Grant funding could be the perfect bridge to take you to the next level in 2024. Learn more about how Grantify is your perfect partner for growth.

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