How securing an R&D grant enabled us to finance our product development
Founder of Release Consulting William Lovegrove reveals how he won an £88,000 technology research grant to build a new product
Name: William Lovegrove
Company: Release Consulting Ltd (trading as Release Mobile)
Started in: 2008
Company description: Release Mobile provides award winning mobile app solutions for businesses
Describe your start-up barrier
Our key challenge was a financial one. How to create a dedicated product development team within a small consultancy without risking the consulting company’s daily business
What steps did you take to secure your R&D grant?
We overcame the financial challenge of funding the development of our product in two ways.
- Firstly we made a budget for the project from our company reserves & directors funds.
- Secondly, we applied for and won a Technology Strategy Board SMART Research and Development Grant for £88K.
In 2010 the TSB changed the criteria associated with R&D grants making it possible for a single company like ours to apply for R&D grants.
Previously, the grants required a collaboration between multiple companies (something that would not have been motivating to us).
We learnt about SMART grants from a company called GrantTree who had previously helped us claim R&D tax credits for some small R&D projects which we had undertaken.
GrantTree assessed our proposal and determined that it would qualify for a SMART Grant because it was:
a) Highly innovative & risky,
b) Required significant Research and Development work
c) Was in a new and emerging area (Cloud technology & APIs) and
d) Was a broad enabling technology which could potentially benefit a great number of businesses.
These are key requirements. SMART grants are competitions, and it’s difficult to win them as the competitions are popular. The application document is substantial, and the work to complete the application took us six weeks.
GrantTree helped us at every stage and I’d recommend their services to any small business which wishes to investigate the world of Government R&D grants and Tax credits.
What was the outcome?
We have built a new software-as-a-service product called datownia, which helps businesses share data with developers.
We are now able to create diverse and sustainable business strategies (marketing and financial strategies) which orbit a product rather than just selling consulting time.
What three questions helped you approach the challenge?
- Is your idea wanted, or needed, by the market?
- Does your team have the desire and motivation to take on the financial risk associated with changing a business model from consulting-lead to product-lead?
- Does your company have the financial resources to see the job done: from market research, through product development, to marketing and sales.
What one piece of advice would you give to others in your position?
It’s not possible to change a company’s business model, or properly research an innovative new product, unless you have 100% commitment from all your company directors. Without that you will create harmful divisions and splits which will hinder the overall effort, if not stop it entirely.
Is there anything you would do differently?
More market research up front. You really cannot do enough market research. The outcome and analysis from the research drives the product development decision making. Make sure you know what you are building, and why, and for whom, and why they will ‘hire’ it from you when you are finished. If you cannot answer those questions then you should not start.