grant writing for startups & entrepreneurs
Post on 02-Nov-2014
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WITH DOUGLAS HAGEDORN1
CEO & Founder of Tactalis
No formal training in grant funding
Started a few small businesses
22 years of school
Strong writing background
Received multiple grants
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YOUR RESULTS WILL VARY
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GRANT
Grant, contribution, subsidy, incentive, scholarship, cost-share, rebate, award, prize, contest etc.
Anything that has an application process and provides support
Applications are very different than pitches!
Grants are not free money!
Grants are tools, designed to achieve a specific task
They apply additional support or reduce energy needed
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Funder Contributed I Contributed What I keep
U of C Student Travel Bursary $500 0 $0
SSHRC $17,000 0 $17,000
QE2 Graduate Scholarship $10,000 0 $0
CNIB Hochhausen $10,000 $100 0
Tecterra CSS $50,000 $2,500* $2500 GST
AITF $15K Voucher $15,000 $6,000 $1000 GST
Innovate Calgary Perfect Pitch $15,000 $200 $2000 + services
Tecterra TAP $7,500 $15,000 0
AITF $50K Voucher $48,750 $16,250 0
TecEdmonton VenturePrize $30,000 * ~15,000
Tecterra Geo-Placement $42,500 (of 50,000) $50,000 0
Total $218,750 $87,800 $20,500
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Bottom up, back to front
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Representatives
Expert Strategy
Group
Marketing OrgGrant
Where do grants come from?
Project Team
http://www.nce-rce.gc.ca/NetworksCentres-
CentresReseaux/CECR-CECR_eng.asp
Expert Strategy
Group
Expert Strategy
Group
More Jobs! Clean Air!
Wealth! Longer Lives!
International Fame!
Investment opportunities!
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Introduction - Who are you?
Proposal - What do you want? What are you planning to do
Due Diligence – How Risky is this? How legit are you?
Outcomes (AKA – Impact, Deliverables, Long Term Value… )
Introduction Proposal Due Diligence Outcomes
You can’t win a game in your own zone,
but you can lose one
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Their decisions are based on your ability to serve that purpos
Outcomes justify a funder’s investment in you
Your potential funders goals are now your goals
Start writing at the back and describe yourself as someone who can achieve the outcomes your funder wants to see
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BEWARE!
Many funding programs are not actually designed to help start-ups, because that’s not their purpose.
A grant may stimulate your company, but hurt its growth
This seems stupid and is exceptionally frustrating!
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Here's how I think of my
money - as soldiers - I send
them out to war everyday. I
want them to take
prisoners and come home,
so there's more of them.
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Lets say you’re a broke start-up leaving a party at AcceleratorYYC and you meet a funder who wants to split a cab.
They’re going to a party way down south, you’re going downtown to where all the action is at.
Convince them you’re going the way they’re already going!
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1. Be concise
2. Use consistent terminology correctly
3. Cohesive applications get funded
4. Be your own consultant
5. Complete their sentences
6. Be correct and confirmable
7. Be current and contemporary
8. Be calendar sensitive
9. Don’t be funding contingent
10. Be creative and clustered, but not-competitive
11. Collaborate with partners
12. Represent a community of practice
13. Become a known commodity
14. Explain valuable credentials
15. Don’t just copy and paste
16. Connect with past recipients
17. Offer a solid corporate foundation
18. Contribute back and be courteous
19. Use careful word choices
20. Circulate you application
21. Understand the chain of command
22. Leave some cash on the table
23. Commercialization potential speaks volumes
24. Consider the funder’s perspective
25. Have a just cause
26. Display cross country value in your own backyard
27. Be confident, not too cocky or too cautious
28. Understand the chain of grants
29. Proof of concept first, then commercialization
30. Calculate your value before and after 19
Say only what you need to and only where you need to!
Being concise lets you say more in limited space
Being concise doesn’t test the reviewer’s patience
You can refer to places where you’ve said things elsewhere
“See attached business plan, pg 17”
“As mentioned in Section 1.8”
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Using inconsistent terminology confuses reviewers and weakens your application
Use only three terms to describe your value prop:
What you do
What you call it
What it’s a type of
We make an interactive tactile computer system, called the Tactalis Origin, which is a type of touchscreen tablet with a haptic interface for blind users.
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One question may actually be many
Describe the technology environment of the project in relation to current industrial practice, problems, opportunities and key innovative elements that would be addressed by the proposed project/product.
Make sure your response aligns with other sections
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Describe the current technological problems;
What are the state of the art leaders in this field proposing to address or circumvent these problems?
How did you select the technology to be developed and the primary applications?
What do you see as the key innovative aspects and advantages of the product or service (refer to the comparative table, if provided)?
What is the scientific basis of your proposed technical advance?
Why do you think your proposed solution has not been implemented before by others?
Is this a continuation of an earlier NRC-IRAP project (feasibility)? What is the contribution of the results of the previous project to this one?
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SWAT, RACI, WSB, ROI
Going through the motions of project management counts for a lot
It gives the impression that you’re not just an amateur making this up on the fly
Bureaucracy likes bureaucracy
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What would be the key business success factors that need to be controlled to achieve the expected benefits?
The key factors for business success that need to be controlled to achieve the expected benefits in this project are:
Cost of customer acquisition
Barriers to market entry
Intellectual Property Protection
Etc
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Solid Current Facts and legitimate stats count for a lot
“According to the World Health Organization there are currently 285 million people world wide who are blind or visually impaired.(WHO FS282, 2013)”
See http://www.who.int/mediacentre/factsheets/fs282/en/
Good referencing: is expected in most grant applications
makes you an expert
Saves your review time from looking things up
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Innovation funders fund innovation
How are you the leading edge? What is your zeitgeist?
Noted consumer and tech trends Let others sing your song (PWC, Pembina, Huffington post, etc)
For Tactalis: Touch 2.0, tablet computers & accessibility
See also:
Total Retail, Nano Tech, 3d Printing, Big Data, Responsive Web, Robotics, Clean tech, Sustainable
Energy, Broadband Wireless, Geolocation, Remote Sensing, Wearables, IOT,
Avoid:
The paperless office, loyalty programs, new social networks,
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Applying for money that isn’t there yet/any more won’t help you
Applying when the funders are concerned about other things ( Christmas, Fiscal
year end, etc) won’t help you
Most programs have a regular cycle for EOI’s
Time your application when your and their bank account is full
Most funders have to publish their annual reports online
Or, call and ask someone what their deal is
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Who would you rather fund?
If they get this grant they can pay themselves for six months
AND spend some money on product development
AND if everything goes according to plan they won’t be screwed.
Startup B
Has more than one profit center and enough cash on hand or incoming revenue to stay alive past the duration of the grant.
Therefore, the grant won’t go to waste once the project is done.
Startup A
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How do you fit into the landscape
Are you a part of a building critical mass?
Do you build upon foundations laid by other companies?
How do you create innovation and synergy opportunities
for other companies?
Do you compete directly with something they’ve already
funded
Funders love the ideas of industry hubs where highly
qualified professionals want to work
Calgary is an oil and gas hub
London is a fashion hub
The Alberta Touch Interface Cluster
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Unite the strength of many organizations
Funders love when their money benefits more than one group
Partnering with established companies reduces risk and accelerates progress
Industry, Academia, NGO,
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Show how you’re not just a lone start-up
Industry organizations lend credibility
Shows who might care about what you do
Funders know you’ll put your logo on a slide at the conference
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Prove that you know what you’re talking about outside the application
Make your opinion and feedback matter
Don’t be a surprise
Have them expect or even want to fund you
Speak at events
Attend tradeshows
Follow them and their staff on twitter
Write a blog
Publish papers
Make introductions
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The letters behind someone’s name and their past home runs only count if you explain how they add value to your future project
If you don’t bother to explain what Dr. PhD’s contribution to the project is the default assumption is that he or she is expense overhead
Is one actually worth two associates?
How does this person add more than they subtract?
Expensive overhead = risk
More education = more specialization = less flexibility
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Tailor your writing for every application
What was great for one application might be exactly the wrong thing for another
Copied and pasted responses rarely make sense or say everything they need to
Every touch
makes you
better
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Find others who have been there before you
Learn what works and what didn’t
Avoid their mistakes
Get the big picture
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It doesn’t matter how great your proposal is if your business isn’t sound and your numbers don’t stand up to scrutiny
Do you actually have employees? Are you full time?
Do you have any money to begin with?
Do you have business insurance? Are you properly incorporated?
For many applications you will have to provide 1-2 year financial statements within 30 days of approval
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Those surveys you get in your email actually matter, A LOT!
Reporting, endorsements, and testimonials are often a big factor in how much follow on funding a granting organization receives
Ask an actual person for their logo to put on your slides and website
Introductions count for a lot
Don’t bite the hand that feeds you
Dance with the person you came with
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Speak their language
For MedTech Funders, speak medicine
For Geomatics Funders, speak geomatics
For Digital Media Funders, speak media
Understand their comfort zones
Develop Patent Application
Vs.
Develop Patent Strategy
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A second pair of eyes will always find additional mistakes
Better that they find it, than the reviewers
Don’t just send it to friends, send it to critics
If it doesn’t make sense to a stranger you know, it won’t make sense to a stranger you don’t
Just because someone has received a grant before, doesn’t make them a good writer (especially consultants)
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CEO
Treasurer
Intake Advisor
Application Reviewer
Admin Assistant
Program Coordinator
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You’re more likely to get funded if you can show that you’ve done your homework and know what things actually cost.
Consider:
We want $50,000 for half of a software developers salary
Vs
We want $44,000 because that is just over half of the average software developer’s salary in Alberta according to data collected by the Altalis portal
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Grants will help you bridge an R&D gap from where you are now, to where you want to go
But, that other side has to exist
Commercialization potential informs timelines
Bigger immediate demand = more need for high dollar value programs
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What you see
New exciting technology opportunity
A better mouse trap
A perfect new team member A small expense
A small investment
A lifesaving product
What they see
Extensive R & D for an unproven market
Something that will make our current portfolio company obsolete
Someone without any proven credentials
A big part of their bottom line
Not their industry
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Be the sort of project that they would want to write about in a newsletter
Give your story some Upworthy spin, social impact or human interest
Consider:
Statistical analysis of long-term deforestation
Vs.
Save the endangered lemurs!
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It’s great that you serve customers in Calgary, but most funders are nationwide.
They can better justify their expenses if they benefit an entire nation or more
Everyone likes to see the home town kid make it in the big show.
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Ask yourself, what would it look like if I dialed it up or down a notch in either direction? If you can’t go any further, that’s probably not where you want to be.
EG: We’re going to install our software in every restaurant everywhere
EG: Our long term goal is to install our software in one restaurant over the next five years.
Based on our forecasts we will be able to install our software in 10 new restaurants per month, for the next three years.
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Opportunity
Assessment
Proof of Concept Commercialization
Support
Industry Projects
$5k - $15k $15K – 50K $25K – $100K $100K+
Recipe
Emphasis on Research and Design
Expected failures
Funds for expertise
Bursaries and co-payments
Germination
Think about the type of restaurant you want to open while proposing your recipe. Can you get a constant supply of fresh
octopus in Calgary each morning?
Restaurant
Emphasis on growth and market penetration
Go from start-up to Home Run
Funds for operating capital
Loans and partnerships
Long term company survivability
You might think you’re ready to open a restaurant but can you prove it?
Where is your recipe on paper?
(Hint: it’s in your business plan or opportunity assessment)
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Funder’s do want to see you succeed
Show them exactly what their money is buying
Secretly everyone wants to help create more investable companies
We currently do $10,000/month in revenue with 3 employees in 1 country
Now we do $100,000/month with five employees in 10 countries
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No, they got it. You’re pretty special alright, but so what?
Did you give people a reason to get excited about them?
Funders want to give you money, really badly! For real!
Unlike everyone else, they’re not trying to keep their money they’re trying to deploy and leverage it
It is literally their job to give out money, if they don’t give out money effectively they won’t get more money and then they can’t pay themselves.
Your job is to help them justify pulling the trigger Cool is never enough justification
Sometimes you can get away with ‘well aligned’
They will tell you what they like to give money to if you look and listen
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Most grant programs operate in steps
Most funders are extremely risk averse even though their goal is to help negate risk
Who would you give $100,000 to?
Startup A: Is riding a wave of hype
Want’s $100,000 to take a hot new idea to market right away or recover/move on from a recent failure
Startup B: Gets $5000 and does what they said they would,
then gets $10,000 and does what they said they would,
then gets $25,000 and does what they said they would,
then gets $50,000...
Now want’s $100,000 to take a new but now well developed ($90,000) product to market 55
IRAP – Proof of concept projects but not commercialization
AITF – Viability Assessment then Research and development
Tecterra – Technical Capacity Building and hiring HQPs
CMF – Digital Content Creation
BCIP – Commercialization Opportunities
Alberta/Finland/Germany/Jalisco – Industry Partnerships
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The only correct answer is yes!
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The Usual
Find out about a grant, probably last minute
Download online application form
Copy and paste text about yourself from something else
Hit Submit
Get rejected two months later
Pout and mope
Try again, maybe
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Sign up for a funding organization’s email list or meet them at an event and ask to keep in touch
Hear about the grant as soon as it’s announced (+ updates too)
Call and talk to who ever runs the program
Have them email you the application or go online and download it
Research the funding organization
Talk to a past recipient (maybe get a copy of their application)
Write your outcomes
Plan your project
Write the rest of your application (using all the C’s)
Call the program coordinator for clarifications and idea bounce
Send it out to a friend for editing
Hit Submit
Prepare
Get approved and get going
Reporting and paperwork
BETTER!
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There’s no such thing as a free lunch
Reimbursement many grants live on your books
You pay the GST
Payment is never on time. Ever.
You pay now!
Yes does not mean authorized and approved
You can’t just give away equity
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You wanted money for something that’s not eligible for funding Prepare a patent vs. prepare a patent strategy
Commercialization vs. proof of concept study
You’re too big or too small or too early or too late for their program
You can’t sustain the grant’s benefit
You just don’t have the cash to make it happen
You’re already eating/have eaten from the same trough
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Try to find service providers that are the same size as you, with skillsets you don’t have
Glue your hands to the steering wheel!
Get flexible terms
You are lowest on a service providers totem pole
Grants usually aren’t enough to occupy a service provider full time
They know that you don’t have the money to retain their services after the grant
They know exactly how much money you have to spend
Split up the pie and make them fight for a second piece
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The last minute is just as long as the first
Don’t draft your application in the online portal
I like Microsoft OneNote (a lot!)
Find ways to do what you’re going to do anyway
By the hour, grants are pretty good money!
Pass it on
Crush it!
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