The Scottish Government has launched a £3 million funding package to provide grants to high growth startup companies and university spinout projects.
The funding has been earmarked for 41 potential startups, which will receive grants of up to £50,000, and 16 spinout projects, which will receive up to £130,000 in funding. The government is also offering the companies bespoke support to help them develop.
The scheme is aimed to help new companies grow in the wake of the Covid-19 pandemic.
Economy Secretary Fiona Hyslop said: “Startup and spinout companies, many of which are in the technology, digital and low carbon sectors, are the future of our economy. They are driven by the spirit of entrepreneurship and innovation. Crucially, they are the kind of enterprises that create high-quality jobs, and which attract investment into Scotland – both of which will be vital to successfully rebuilding the economy after the damage caused by COVID-19.
“By supporting startup companies and spinout projects through this funding we can not only help them survive, but give them the potential to prosper. This is a key part of our long-term mission to create new jobs, good jobs and green jobs.”
Previously, in July, the Scottish Government announced that early stage, high growth potential companies would receive £38 million of funding, to be managed by Scottish Enterprise. The £3 million round of grants forms the first part of this.
Additional rounds include the £25 million Early Stage Growth Challenge Fund, which will provide equity-backed businesses with a mix of grant and investment funding up to a maximum of £300,000.
An additional £10 million will go to Scottish Enterprise’s existing Scottish Investment Bank co-investment funds to help stimulate private investment and support businesses that need more significant levels of funding to grow
Scottish Enterprise CEO Steve Dunlop said: “The coronavirus pandemic has had far-reaching impacts on all aspects of our business base including our high growth early-stage businesses and university spinouts.
“It’s vital we continue to support these ventures so that those with the very best growth potential can flourish into significant businesses of the future. We’re pleased to have been able to work at pace with our partners to identify these projects and to get the funding to them in such a short space of time.
“We will continue to work closely with the companies and spinout teams to provide a range of support that will help them further develop and attract new future investment.”
One of the first groups to receive funding is the University of Edinburgh’s Exergy3 spinout project. It aims to store power using electric-to-electric thermal energy storage technology, which has the potential to convert existing fossil fuel-burning power plants to zero-carbon energy storage systems.
Work on Exergy3’s small-scale prototype ground to a halt due to the coronavirus outbreak. However, with the additional support from the Scottish Government, the team is now able to progress and take the technology a step closer to commercial use.
University of Edinburgh lecturer in mechanical engineering Dr Adam Robinson said: “This funding will springboard us to the next stages of our project where Exergy3 can be central to Scotland’s low carbon transition.
“We can now complete and test our small-scale prototype, build a consortium to demonstrate our technology on a working power plant, as well as demonstrate the commercial case for our technology. Energy3 has global export and investment potential and could provide high-quality sustainable jobs of the future.”