Tekes offers a wide variety of financing vehicles fitted to meet the needs of different types of companies in different points of their life cycles. Even going outside the startup sphere, Tekes supports organizations like heavy industry as well as academic and research initiatives.
But for most of our readers, there are a few plans designed to meet the needs of growing companies. Here are some details that are good to know about before going into your first meeting with Tekes. For most of you out there, the main funding vehicles offered are R&D funding, Young innovative growth enterprises, and work organization development.
R&D funding is built around a specific project. For SMEs Tekes covers 35% or 50% of project costs by a grant, or 70% by a loan. The loans are specifically given to projects that are closer to market, or result in a marketable product or service or a new business concept. The loan is a riskloan granted without a security. The funding can also be granted as a combination of a loan and a grant.
Tekes also offers small work organization development grants designed to improve the productivity and quality of working life. I haven't heard of many startups receiving these, but it may be something to keep in mind if you need funding for an innovative way to improve productivity and morale.
A fresh new initiative put together by Tekes is Tekes Tempo. Here they try to quickly test out mobile ideas out on the market by streamlining the whole financing process. The goal of the program is not to develop a finished product, but rather to gain more knowledge of markets and users.
Tekes also offers young, innovative growth enterprises funding for development of their business activities, with the aim of accelerating the growth and internationalization. This funding is set aside for companies who are at the cusp of receiving real, international resutlts. DealDash is part of the Young Innovative Companies (YIC) program at Tekes, and we got a chance to talk with founder William Wolfram about his experiences.
DealDash is a penny auction site that has grown a substantial following in the US market by encouraging social features and building trust with their users. We here at ArcticStartup have been following the story of his company for some time, and even interviewed him on our podcast, UnfairAdvantage.
Since the YIC funding was granted, DealDash's monthly turnover has more than tripled and the company has been profitable for more than nine months in a row, with the growth continuing.
"We had a discussion with the team at Tekes and together came up with the right setup for us, which in our case at the time meant debt," Wolfram says.
"Our experience was straightforward. Tekes made it clear what info they needed from us and together with the Tekes team we got valuable advice, formulated a reasonable plan, and ahead we went."
At the moment DealDash has YIC related future plans including investing in new technical infrastructure and exploring new marketing methods, and things are looking good. "DealDash's next big challenge and opportunity is creating scale. A year ago we were processing around 10,000 transactions a day," Wolfram tells us. "Now we are doing more than 120,000 transactions a day and the speed of growth continues to accelerate. There are not many Finnish web developers that have the experience of building massive scale. That's why we needed a really strong CTO to lead our technical team. We have recently hired an industry veteran from Finland who has a mission of building the best web development team in Finland. We are psyched!"
Hear it from startups
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.