The “Innovation Ecosystem” funding programme is to reinforce incubators that drive the launch, mentoring and training of startups in order to help create an efficient community and training centers to find, develop and finance promising innovative ideas across Hungary. The NRDI Office conceptualised a scheme to support innovative startups, as well as incubators, which provide all the vital tools for startups for their early stage of growth, in a complex way. Incubators winning funding under the recently announced call will invite a call for proposals for the development, training and driving the market entry of startups, and innovative startups will draw down the grants, awarded on a commercial basis, directly from the incubators.
The programme, announced with a total allocation of HUF 5 billion (approx. EUR 16 million), is designed to drive the development of the Hungarian innovation ecosystem. An important element of the programme is that the state should share high risks associated with investing in innovation-based startups, with the owners of incubators specialising in the development of startups.
In the first phase of the programme, enterprises aiming to found incubators can apply for funding earmarked for startup ecosystem development to create incubators. Once the incubators have been set up by successful applicants, they can directly invite proposals by startups. Incubators will decide in their own discretion on the selection of startup projects to be awarded funds to finance them. They will be entitled to use up to 20 percent of the grants received to finance their own operating expenses, and the remainder should be transferred to the selected startup beneficiaries, up to HUF 60 million (approx. EUR 193,500) for each project. Incubators will be directly interested in the success of the selected projects since they will be required to invest own funds no less than 20 percent of allocated grants in the startups. During the incubation process, the incubator will, through its investments, also become a stakeholder, owning up to 24 percent of the company.
The funding of HUF 5 billion (more than EUR 16 million) in total to be allocated under the recently announced call comes from EU funds under the Economic Development and Innovation Operational Programmes (GINOP/EDIOP), and as such is designed to help build the startup community in whole Hungary. Each incubator can apply for funds up to HUF 600 million (approx. EUR 1.9 million) for a 3-year period to implement its program covering the finding, selection, mentoring, technology and business development and financing of innovative startups to market entry, as well as the organisation of professional events.
The GINOP programme will be soon followed by a call financed from the NRDI Fund with a total allocation of HUF 1.5 billion (approx. EUR 4.8 million), designed to reinforce and dynamise the already existing innovation ecosystem of the Central Hungary region, since EU funds cannot be used for that purpose.