About The Market Development Fund
The Market Development Fund (Markedsmodningsfonden) supports market maturation of novel and innovative products. In 2016, the fund allocates DKK 56,4M.
Companies can apply for co-financing of testing and adaption of their products under reality-like conditions or co-financing of guarantees for the end-user to mitigate the buyer’s uncertainty about investing in novel technology.
The project must have the following characteristics:
- It must be novel and separate itself from existing products and services on the global market
- It must have a strong commercial foundation
- It must have the necessary organisational structure i.e. the relevant partners should be in place
- It must create growth and employment, realised by a high and realistic level of ambition and a clear growth strategy
- It must have socioeconomic effects such as resource efficiency, environmental advantages etc.
- The grant must provide an incentive effect. For large companies, it is important that the effect is analysed and it documents a substantial increase of the size of the project or speed of the execution.
The purpose of the Market Development Fund is to complement the Danish funding schemes that focus primarily on early development. The Market Development Fund supports projects after the development phases and focuses on the final market adaption of new and innovative products.
Possibilities with The Market Development Fund
SMEs as well as large companies can make use of the program for co-financing of new initiatives as there are various opportunities for grants:
Testing and adaption
- Grants for testing and adaption of a product to better reach the market.
- With successful application of the program companies will typically receive grants of DKK 1.2-5M for demonstration and market maturation of new products
- Small companies: Grants covering up to 60% of project costs
- Medium sized companies: Grants covering up to 50% of project costs
- Large companies: Grants covering up to 40% of project costs
- Public partner: Grants covering up to 50% of project costs
- The Market Development Fund can offer a guarantee of the product to assure the innovative character of the product and thereby mitigate buyers’ uncertainty about investing in new technology. In this case, the risk is split between the manufacturer (20%), the Market Development Fund (60%) and the buyer (20%), i.e. if the product deviates substantially from the initial promise, the customer will get back up to 80% of the price.
- With a successful application of the program, a total guarantee framework of 3-12M DKK can be granted for the guarantee of new and innovative products
Requirements with The Market Development Fund
A project must be lead by a private company with minimum two full time employees. Companies can apply alone or in a consortium with both private and public partners. The Market Development Fund does not support projects for research, demonstration, development of pharmaceuticals, natural or alternative medicines, or financial services. The Market Development Fund supports international projects if the primary beneficiary is a Danish company. I.e. if the technology is owned by the foreign partner who will be the de facto primary beneficiary, the Market Development Fund cannot support the project. Additionally, following requirements must be fulfilled:
Testing and adaption:
- The product must be successfully tested in a demonstration facility, laboratory or the like.
- At the time of submission there must be an agreement in place with minimum one test consumer
- The budget must be of minimum 3M DKK and the project must be completed within three years
- The product must be fully developed and ready for market introduction
- The guarantee can maximum be for two years
Below are the upcoming deadlines for The Market Development Fund. Expect 1-2 months for the proposal writing process.
Companies can apply for funding to test whether a developed prototype or concept works in a realistic environment or at a prospective customer’s site and to adapt the prototype/concept in order to strengthen the solution’s commercial potential.
The final application deadline is 7 October. However, companies must complete a mandatory pre screening, in which the Market Development Fund will initially evaluate the applicant. The pre screening takes places from 8 August to 30 September.
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