Getting Started With Tekes Financing
With the new year right around the corner, I'm sure many ArcticStartup readers have it in their mind to finally start a company from that business idea they have knocking around in their head. If you're in Finland, you may find help getting off the ground with funding from Tekes, the "Finnish funding agency for technology and innovation." Getting the funding process started with Tekes is fairly straightforward. The basic steps are to first be prepared to answer basics about your company's plans, to send in a sounding form to make contact and discuss more about your company, and then to prepare the actual application.
Before submitting anything to Tekes, take a second to familiarize yourself with is a list of test questions your Tekes contact person will likely ask after you submit your application. I'm sure you've seen these Due Diligence questions before, but its good to solidify your answers to questions like "Who are your potential customers," early in the stage where your company is applying for Tekes financing.
If you haven't gotten in touch with anyone at Tekes before, your first contact will be through the sounding form you send in, where you describe your idea, customers, and growth target. This isn't the main Tekes application, but it's important to describe your idea accurately so the right contact person will be assigned to your idea. Within a week of submitting the sounding form, an Tekes representative will get in touch with you with a proposal on how to proceed.
Many digital startups who need to quickly get to market will likely find Tekes Tempo a great division of the Tekes service. If you are looking to get your product to market quickly, use the same form as above, but in the section 'Focus of development', choose 'Other' and write 'Tempo' in the field below.
When you fill out your application to Tekes, it's important to prepare your application professionally and honestly. Not too many people know that your Tekes representative will later pitch your application internally behind closed doors at Tekes, meaning you should include all the required annexes and attachments so someone else can accurately describe your project.
I talked with Elina Arponen from Tribe studios about this process, and she told me that when they first applied to Tekes, they got more of a "maybe" than a "yes". But Arponen and the team followed up with their Tekes representative to change their application into a successful iteration once they developed their business further. This is an important theme echoed other startup founders in this series: follow up with your contact person before and after sending in your application. Good communication is crucial for both the applicant's and Tekes' needs, so take advantage of the representatives' availability.
Tribe Studios applied for Tekes about as soon as they registered the company with only the team and the idea. Despite being somewhat rejected by their first Tekes application, they also applied to Bootcamp (now Startup Sauna) where they developed the company behind Velvet Sundown. Between the Business development at Bootcamp and by staying in contact with their Tekes representative, they were later able to finance a half-year project with a loan through Tekes.
In general, Arponen finds the Tekes representatives easy to work with and on the "same team" as her company. When applying for financing you allocate certain amounts of funds into areas like salary and rent, and Arponen only realized after her project was finalized that she didn't include travel costs. Rather than it being a big deal, she had the runds reallocated by sending just an email, which she seemed impressed with.
Today, Arponen and Tribe Studios are hard at work developing Velvet Sundown, a game targeted at an older audience that still want's to play something social, but doesn't necessarily have the time to play an extended game. With Velvet Sundown, all the characters are played by your friends online, and the drama only takes one hour to complete. Arponen describes it as "like watching a movie, except you get to be the star."
Thinking about getting a project started with Tekes? Here's a good place to get started.
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This series of posts is sponsored by Tekes and produced in co-operation with ArcticStartup to share experiences from startups about their funding experiences.
Interested in the fast turnaround of Tekes Tempo?
Find contact details, information on the program, and how to apply on their about page.
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Games are just publishing business. Games are rarely innovations and are not technology development. Using tax money for games distorts competition.
As with all of these sponsored posts (=paid ads) there should be a clear disclaimer at the beginning of the post, not the end.
I have seen many posts regarding Tekes Tempo without much explanation about the terms of the program, other that mentions that it's for building mobile MVPs, pivots, *insert buzzword here* and so on. While I feel that this is a good direction with an organization like Tekes (especially that money can be used to fund own salaries and thus keeping the development in-house), here's the data points I have received from a person associated with the program:
- Funding is split 30/70 with startup and Tekes
- Minimum funding size is 100k so the startup needs to have 30k in pocket
- My contact didn't know what is the max/min of the funding that the start can use for their own salaries
For me this doesn't correspond to general idea of building a MVP for a mobile service which in most cases can be done in just a month or two with couple of guys/gals. And this comment applies to mainly mobile and web services, other industries might require more funds. I would really like to hear more about the terms and the reasoning behind them from someone with more insight (or from Arctic Startup, outside this sponsored post format).
Disclaimer: My data might not be accurate, but unfortunately there's not a good public source for it at the time of writing this.
Jori, thanks for the feedback. Always valuable. We'll talk to Tekes about this and see what we can do.
Jori, that is probably not totally accurate. What I've heard is that Tempo program offers 50-50 funding. Minimum project size is 30k (so startup needs to fund 15k, though it needs to pay for the bills first of course before getting the money reimbursed). Costs outside Finland can be max 50%, but there's no strict limit on outsourcing vs internal costs.
These terms sound more reasonable to me for the idea of building an MVP.
Thanks Miikka for the clarification. I hope TEKES would be more transparent about the nature of the program.