Expert insight by Bram van Weerdenburg • 4 min read

On 13 October, the European Commission presented the IF26 SME Call: €200 million from the Innovation Fund, reserved exclusively for SMEs. It is a welcome move. Most of my work involves Innovation Fund projects above €30 million CAPEX, and over the years I have seen many cleantech SMEs conclude that the Innovation Fund simply “isn’t for us”. This time, the call is designed to change that.

The Commission has clearly listened: the application process is lighter than in the large-scale calls. But a simpler application does not make the project itself any easier to finance. That, in my view, is where SMEs should focus their attention now.

What the SME call offers

The IF26 SME Call targets smaller first-of-a-kind investments that have so far fallen between the cracks of the Innovation Fund. The main features:

• Project size: €2.5 million to €20 million CAPEX, located in the European Economic Area (EEA).
• Funding rate: up to 60% of relevant costs, calculated on the project’s funding gap.
• Eligibility: SMEs only.
• Scope: first commercial deployment in industrial decarbonisation, CCUS, renewables, energy storage, cleantech manufacturing, aviation, buildings and road transport. Maritime projects fall under a separate call.
• Degree of innovation: innovation at national level is sufficient, although European-level innovation scores higher.
• Simpler process: a semi-automatic GHG emissions calculator, fewer annexes, more pass/fail criteria and lighter reporting obligations.

The call text is expected on 3 December 2026. Two cut-off dates are planned: the end of March 2027 and September 2027.

Where I see the real challenge

The application has become simpler; the financial demands have not. Before investing time in a proposal, I would advise SMEs to look hard at five points:

1. There is no pre-financing. Payments are tied to milestones, which means you fund the investment first and are reimbursed later. Without bridge financing in place, you risk winning a grant you cannot execute.
2. The 60% applies to the funding gap, not to CAPEX. The grant covers the extra cost compared with the conventional alternative, not your total investment. A project with €10 million CAPEX does not automatically qualify for €6 million in funding.
3. The consortium must consist of SMEs only. Large industrial companies cannot be partners. They can, however, act as customer, host site or offtaker, and that involvement often convinces both evaluators and financiers.
4. You need a real investment plan. With €2.5 million as the minimum, a promising technology is not enough. Evaluators will expect a defined design, supplier quotes, heads of terms with offtakers and a credible timeline.
5. Watch your SME status. This is where I see a genuine weak point. To pre-fund a project of €5 to €20 million, many scale-ups will need to raise new equity. If a corporate or strategic investor acquires more than 25% of the capital or voting rights, the EU SME definition requires you to add that investor’s staff and financials to your own. That often ends your SME status, and with it your eligibility.

In other words, the money you need to carry the investment may be exactly what disqualifies you. How the final call text deals with this, for example the moment at which SME status is assessed, will be decisive for many applicants.

Why I would aim for March and start now

Two cut-off dates offer some breathing room, but that is no reason to wait. In our experience, the first round of a new call attracts less competition, because many companies are still finding their way. September is likely to bring more applicants, and better-prepared ones.

There is a second advantage. If a March application does not succeed, the evaluation feedback gives you a clear basis to come back stronger in September. Given the financing questions above, the months until the call text is published are best spent securing bridge financing, offtaker commitments and a solid investment plan.

Is your project a fit?

Curious whether your project fits the IF26 SME Call, and whether the March cut-off is within reach? Get in touch for a quick check of your project against the main evaluation criteria. Contact us at info@hezelburcht.com, call 088 495 20 00 or complete our contact form to arrange an introduction:

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About the author: Bram van Weerdenburg works at Hezelburcht since 2016. He works on Innovation Fund applications, mostly for large-scale projects above €30 million CAPEX.