Find financing for your business innovation

What is innovation?

Innovation is about creating new products, services, and/or business processes. You may even be involved in innovation already. For example, by adapting a product or service. Or replacing a machine to save money and energy. Inventing something new is also innovation. 

Finding funding

Organise money for your innovation plan in 3 steps:

• Determine how much money you can invest yourself.
• Check whether you are eligible for subsidies and schemes.
• Find out which external financiers you can approach.

Self-financing 

Do you need a small amount of money for your innovation? Try to find  funding from your own business. Take a good look at your stock, for example. Do you need to stock everything, or can your supplier deliver quickly? Or try to get your debtors to pay faster. The advantage of self-financing is that costs are relatively low. A disadvantage is that you could end up with less working capital.

Subsidies and tax schemes

The government supports SME innovations with subsidies and tax schemes. For example for research and development, innovative products, process innovation, and energy and sustainability investments. With tax schemes, you do not receive any money, but you pay less tax later. Subsidy schemes usually do pay out money.

Subsidies

Use the RVO subsidy overview to find out which subsidy scheme suits your innovation. Study the schemes and plan time to prepare the application. You can also consult an advisor. Provinces and municipalities also have money with which they stimulate innovation. You can find more information on their websites.

Schemes

Well-known schemes for innovative entrepreneurs are:

Innovation box

The innovation box is a tax scheme that allows businesses to pay less corporate income tax on the profits they make from innovative activities.

WBSO

The Research and Development tax credit scheme (WBSO) reimburses part of the (wage) costs and expenses you incur for research and development activities. Conditions for the WBSO scheme vary by type of business and project.

VFF

Proof-of-concept funding (VFF) is a loan for entrepreneurs who want to investigate whether their innovative idea has a chance in the market.

Innovation credit scheme

The innovation credit scheme is for entrepreneurs working on the technical development of a new product, process, or service. You get a loan for part of the development costs.

International orientation

There are several European schemes for international innovation projects. For example Eurostars, Horizon Europe and INTERREG.

Startup box

The government has loans and other financial schemes for start-ups, scale-ups or rapidly innovating SMEs. With the Startup Box, you can see what schemes the government has for you and which ones best suit your plans.

External funding 

You can also choose to fund your innovation plans with external capital, money from outside your own business. When contacting a financier:

• you must have drawn up an investment budget for the upcoming 2 to 3 years – this is part of your financial plan. 

• state what you need the money for and when you need it. 

• make clear how much additional turnover or savings the innovation will generate
• show the costs, including your own and your staff's hours, the development costs, and the costs  for selling and marketing the product or service;

• put your revenue, the required investments, and your financing requirement on a timeline, then translate this into a strategy that clearly reveals your approach, for example with the Business Model Canvas. This could potentially help you attract investors to back your innovation plan. 

Read more about the components of a funding application.

Find your form of financing

Are you going for external funding? Use the Choosing Financing Tool. It will show you the way to a suitable form of financing and parties offering it.

SME credit guarantee scheme (BMKB)

Does your business have insufficient collateral to get a loan? The BMKB is a Dutch government scheme that helps entrepreneurs get financing. With this scheme, the government guarantees part of the loan. Then you can borrow more than you would get based on your collateral. Your financier applies for the BMKB.

For innovative entrepreneurs there is the BMKB Innovative. Especially for entrepreneurs working on technological innovation. If you want to use this scheme, you first need a R&D declaration.

Venture capital 

When it comes to funding your innovation, you tend to depend on venture capital. These funds are provided by venture capitalists: people who are willing to invest in your business while they are not sure what the innovation will yield financially. Does the innovation succeed? Then the returns can be great. But the return from the innovation can also be disappointing. It is precisely this risk that a venture investor dares to take.

Shares are a type of venture capital. An investor buys shares in your business, which generates additional capital. The investor becomes a co-owner of your business and shares in its profit or loss. Such an investor is called an informal investor or business angel.

Help with business financing

The Financing Guide helps you find your way in financing your business. Do you still have questions? Call the helpline on 088 585 11 11 or ask an expert for advice.