InnoRate: Data-driven tools for supporting and improving the decision-making processes of investors for financing innovative SMEs

A new Horizon 2020 project started in January 2019: the InnoRate project was born to bring innovation to the heart of financing solutions in Europe.

Grounded on the belief that innovation is key for boosting the competitiveness of the European economy, creating jobs and driving its sustainable growth and that, therefore, it has to be adequately supported through investments, the InnoRate project was conceived in the frame of the European Union’s Horizon 2020 research and innovation programme.

When it comes to innovative SMEs with high-growth potential that can play a pivotal role in driving economic growth, access to finance can be a bit of a challenge. At the same time, the current state of play in assessment methodologies does not seem to be able to mitigate the risk aversion of investors, who end up passing up on very promising investment opportunities.

InnoRate is set on deploying a trusted, objective and recognised service platform across the EU and AC to support and improve the decision-making processes of investors and lenders for vetting, prioritising and providing access to finance to innovative high growth potential SMEs.

The novel InnoRate Technology Rating System will provide a suite of digital decision support tools and services, reinforced by well-customised innovation assessment and rating methodologies that go beyond the traditional credit-focused approaches in evaluating the technological and business potential and risks of innovations. In doing so, InnoRate draws inspiration from and adapts to the EU reality the objective, trusted and forward-looking Technology Rating System (TRS), the KTRS. KTRS has been used for more than 15 years now by our partner KOTEC, providing access to finance for innovative SMEs in Republic of Korea.

In the course of the project, the InnoRate Technology Rating System along with its rating methodologies, decision-support tools and investment readiness and match making services will be applied to a diverse and representative set of use cases, ranging from investors scouting for and prioritising high-growth potential SMEs for access to finance, to financial institutions assessing such SMEs for loan-based financing.

Overall, the InnoRate Technology Rating System will leverage semantic technology, existing data sources and in-depth human expertise in order to:

• Minimise the time and resources (human and financial) required by investors and lenders;
• Reduce knowledge and information asymmetries and ultimately risk premiums paid by innovative project managers;
• Make the prospects of innovative SMEs clear to investors;
• Disrupt the largely risk-averse financial sector of the EU and AC, enhancing the innovation capacity of high growth technology sectors and SMEs;
• Pave the way for drastic innovations to flourish;
• Place Europe in the forefront of the global innovation game.

To put it simply, InnoRate wants to bring innovation to finance and finance to innovation.

The InnoRate consortium consists of 9 partners representing 6 different countries. The consortium is well-balanced and includes experts with a wide range of competencies and backgrounds, from investors / lenders & platforms connecting with innovative SMEs, to business & financial advisors, to semantic technology solution providers, and, finally, to Technology Transfer Offices. In a particular, the InnoRate consortium is the following:

• Q-PLAN INTERNATIONAL ADVISORS PC, Greece – (Coordinator of the InnoRate project)
• TECH TOUR GLOBAL, Bulgaria
• EY ADVISORS S.p.A, Italy
• EUROPEAN BUSINESS AND INNOVATION CENTRE NETWORK AISBL, Belgium
• Jolt Capital SAS , France
• WHITE RESEARCH SPRL, Belgium
• ONTOTEXT AD, Bulgaria
• UNISMART PADOVA ENTERPRISE srl, Italy
• KOTEC Technology Finance Corporation, Korea

Stay tuned for all the updates!